One major issue has been that paying a developer market rates is practically unthinkable to traditional automakers. If you were to apply to a mid/senior job in Michigan, you might get offered $125k. The typical workaround has been to establish "software offices" on the west coast with separate pay scales and separate corporate structures that largely function as internal "external" vendors. The C suite are able to pretend they're not overpaying, and the teams getting work done are able to attract people closer to market rate.
Well, it’s not just about pay scales. The developers just don’t want to live in Detroit (or even Ann Arbor) for the most part. And coastal East isn’t really that much cheaper for the most part.
I’d probably add that the pay scale for software vs. electrical/mechanical people probably wasn’t notably different in the 90s or so. And California rates didn’t compensate for CoL in general. Very different.
