Auto Suppliers' Return to Profitability Sends Signals About Innovation in U.S. Advanced Industries
The long-awaited and hard-earned return to profitability at the country’s largest auto suppliers, reported by the Wall Street Journal last week, reflects deep structural shifts underway in the nature and organization of advanced production in the United States. As hardware and software converge in the nation’s R&D- and STEM worker-intensive advanced industries, suppliers are being relied on to produce more and more of the innovations that iconic firms such as Boeing, Ford, General Electric, and Siemens integrate into highly sophisticated advanced products and platforms. Recent Brookings work on the space industry in Colorado and the automotive industry in Tennessee —each an example of what we call an “advanced industry”—sheds light on the extent, complexity, and locations of these supply chains undergirding U.S. competitiveness. Let’s zoom in on the auto industry. According to the Bureau of Economic Analysis, supplying the motor vehicle and pa...