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Ford had a chance for long term survival when they had Jaq Nasser (Jaq the knife) at the helm, he dealt properly with the Firestone issue, he made some tough calls on product direction, down sizing and quality improvement, but he pissed off the Ford family because they didn't agree, erroneously in this case so he was ditched.
https://teakdoor.com/images/imported/2008/11/459.jpg
A Honda Jazz just ain't gonna cut it.
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Toyota Prius up for it? Not a chance.
https://teakdoor.com/images/smilies1/You_Rock_Emoticon.gif
How many horses does a VW have?
https://teakdoor.com/images/imported/2008/11/460.jpg
Thanks, but no thanks.
Agree with you there. That was back when the big three were kings, flush with cash and could could do no wrong. Now the unions are squabbling amongst themselves, too.Quote:
Originally Posted by peterpan
Its all a management problem, the unions only got away with whatever weak management let them.Quote:
Originally Posted by Jet Gorgon
Anyone know if the cos. can cut the unions if they file for Chapter 11? For sure renegotiations on wages and benefits.
rThese greedy fcuks are getting $78 an hour..... nothing more than greedy scum. Offer those jobs to the public at $25 and you got a line up. If they are worth $78 then they should have no problem finding another job for $78. Also, since they are suppose to be worth $78 an hour they should easily be able to find many many $50 - $60 an hour jobs. You show me something worth $78 that sells for $50 - $60 and I'll show you a supply problem. Can you imagine a computer factory staffed with these shitballs??? Out of business first day. Fact is, these slobs can't even find a $15 job. The $78 is the result of many years of union extortion. Their main skill is being in a union and complaining about management.... not valuable. Non-union shops want nothing to do with them.Quote:
Originally Posted by Jet Gorgon
I don't support any of them, I buy cheap used my cars.
Sorry if I offended any union members, truth hurts.
^ Now, now, Jim, the $78 an hour deal was only for NEW hires.
Hey, why better yourself? Drop out of high school, grease the union, and hey, $78 an hour PLUS healthcare and pension plan! Gotta love the UAW.
^ Even worse than I thought. Free markets require supply and demand work hand in hand. I know many tax paying welders and machinists making $20 - 30 an hour, equally or more skilled than UAW workers, with mush less benefits and no job security in a downturn. Management main fault is not bankrupting the auto companies sooner.
This is from last year, but maybe you have the latest news, Sabang.Quote:
Originally Posted by sabang
LOS ANGELES: The United Auto Workers, which has yet to organize a U.S. plant built by an Asian carmaker, was to have held over the weekend its second event this year aimed at convincing Toyota employees in Kentucky that they need union representation.
UAW Stepping Up Drive to Organize Toyota's U.S. Plant Workers - International Herald Tribune
GEORGETOWN, Ky. -- Dissident workers at the Toyota plant here gather at the Best Western Georgetown on Wednesdays between shifts to shape a battle plan. The workers are angry at conditions at this flagship Toyota site, where the best-selling Camry is built.
The United Auto Workers has launched a big new push to organize the plant, trying to capitalize on fears of lower pay, outsourcing of jobs and on Toyota's treatment of injured workers. The stakes for the UAW intensified this month as a private-equity firm agreed to buy Chrysler, raising fears that the union will be unable to block cuts in jobs and benefits at a privately owned automaker.
The UAW has never succeeded in organizing a foreign auto assembly plant in the US, but Toyota's emergence as the world's largest automaker has added urgency to this effort.
In Kentucky, Toyota Faces Union Rumblings - washingtonpost.com
I am no big fan of the UAW, and I would agree they are part of the reason the big three have ended up where they are today. But the wages cited in this thread seem really high to me – so I did a bit of looking around, and this is what I found.
Anything close to the $70+ dollars an hour generally include legacy costs associated with retired employees. And while that number has value as it relates to the companies ability to compete in the marketplace it does not accurately reflect the income of the average autoworker.
Beat the Press Archive | The American Prospect
Here are some links to sites that have actual wages and they tend to be between $25-$40 per hour – plus benefits. This is still much hirer than the average manufacturing worker in the US.
New Contract Protects Wages, Provides Four Lump Sums - UAW/Chrysler Hourly Contract 2007
TheStar.com | Business | Ford workers accept deal to freeze wages
Here is a link that shows the cost of TOTAL compensation as they compare to the Japanese automakers, and university professors with PHD’s. As can easily be seen here it is going to be pretty hard for them to survive when they pay around 50% more in total compensation then their Japanese competitors.
CARPE DIEM: Transformational UAW Deal? Accept Professors' Pay
Now this link included info on wages, but also give a break-down of the total cost of labor per vehicle. Problem is I doubt the chart is accurate of the total cost of labor, but even if the cost is off by 100%, the cost of labor is still a rather small portion of the total cost of the vehicle.
Wages and labor costs - UAW Bargaining 2007
I used to live in an area that had a number of GM and GM related employees (Dephi and such). Their base salary is hardly indicative of the average pay, as most of them qualified for some form a shirt, or job related premium, and they pulled down oodles of cash for working overtime, weekend, and holiday shifts. I know a number of them that have taken advantage of the buy-outs and early retirement packages that have been offered by the big three. Some I think we get stuck holding the bag (early retirement folks) ‘cause I doubt the long-term ability of the big three to pay (both the specified retirement pay as well as the health benefits and such). On the other hand I know of some that took buy-outs that saw the writing on the wall, took what they could get, and started fresh somewhere else.
I have several relatives that have worked or are currently working in union jobs. And I think there is a place in the US for unions, and IMHO they are the main reason that the US ended up with a significant middle class sector in the first place. So I thank them for what they did in the past, and I wish them the best in the future. But by and large the unions themselves have become monsters that are not looking out for the best interest of anyone except the union.
One relative in particular that was regularly involved in contract negotiations and used to bemoan how easily the workers he represented would fold for a cash bonus now, as apposed to wage increases that would build to much more over the long haul. Poor guy was a wreck every time contract time rolled around, trying to figure out how to get them to not cave for the bonus.
The advantage Toyota has is the UAW cannot shut them down with a strike. Toyota can switch to importing cars during a strike which makes an even playing field .... workers get unemployment, Toyota imports ... and the strike goes on ... and the strike goes on... Eventually they both say F this and go back to work making cars.
I'll never understand the massive trade imbalance the US puts up with decade after decade. It was $820B in 2006, $770B in '05 ...
We've stopped making almost everything. We're labeled as a glutenous consumer society. When the shit hits the fan and we stop snapping up everything that Japan and Germany and China makes, they fall flat on their faces faster than we do, and then they whine that we're not supporting their manufacturing ... :)
The service society America has become will bite us in the ass. It's unhealthy to be so one-dimensional.
The sharp decline of the dollar vis-a-vis many currencies simultaneously this time last year meant those imported goods got real expensive in a hurry. The gluttons stopped buying and the world started creaking to a standstill.
I agree with Milton Friedman that trading pieces of green paper for cars and ships and computers and jetskis is a great idea if those dead presidents never make it back to America -- but we're losing leverage that would be maintained if we'd make more shit at home.
In that sense I think it's a bad thing if US auto makers die. But I'm not excited about bailing anyone out.
As far as I know the UAW has yet to penetrate Toyota with the exception of the NUMMI plant which I believe was Toyota’s first venture into the US, and is a joint operation with GM.Quote:
Originally Posted by Jet Gorgon
Needless to say with the problems at GM things don’t look real good out in NUMMI right now:
NUMMI employees in Fremont may face layoffs - 11/07/08 - San Francisco News - abc7news.com
With things going as poorly as they are for the big three, I don't think the UAW has much going for it to promote how good they are for the long term good of the employees in their attempts to convince current non-union shops to join them on their way down.Quote:
Originally Posted by Jet Gorgon
Hey Tex, this is a great moment!Quote:
Originally Posted by Texpat
You are coming round to my point of view on the US (and UK) economy...
:)
Yes, I'll admit, I never expected things to get like this. :(
What goes well with crow?
Would you like the pie hot or cold?Quote:
Originally Posted by Texpat
:)
Anyway, on a serious note, my 'big one' that I predicted in June is now on the horizon of the mainstream media:
https://teakdoor.com/us-domestic-issu...tml#post833794
I'm a crash repair technician by trade, 22 years. ( that's panel beater to you :) )
The money in the last 10 years has been in re-furbishment of lease plan cars.
That's company and personal credit arrangements to get new cars out of the factory and get them registered and on the road, the ratioanle is that nobody will pay the full price for a car that is going to depreciate by 30% the moment the new owner turns the ignition for the first time. The cars are leased for a fixed term 6-24 months then returned, re-furbed and sold on again as quality used cars still under warranty.
I would estimate that 80% of late model cars on the road are on credit.
The high initial retail credit price when judged in context of the massive surplus of vehicles available, make it obvious to any one in the trade that we were working under a false economy with a very finite lifespan.
The motor trade is all about logistics, and once the profits become less tenable the large logistics companies that have been active in this sector soon divest their intrests and move on to greener pastures.
The contracts have dried up for re-furbishment work over the last 2 years, as costs and narrower margins have made it less profitable.
The manufacturers have implemented reductions in output, but like a large tanker on the oceans it's too little too late.
The recent financial crisis has dealt the credit base for lease plans a death blow.
The sales figures for new cars are down 24% on the last quarter and the impact of a massive reduction on new registrations in the October bi-annual registration period is yet to be seen.
Even if Ford and GM continued production at 70% capacity there is no market and no finance available to sell their product. And it is unlikely that market will resume within the next 6-12 months and even then it will never really return to the peak output levels of the last ten years.
The impact in this situation is truly global and it doesn't only affect the 2 million workers in the US but many millions worldwide, it's going to be difficult but I don't see the point in bailing out the auto industry, in fact doing so will only stor up further problems for it in the future, better to let it downsize, re-evaluate its market and goals and become healthier in the future.
As I say I'm a tradesman and it is fortunate that my skills are transferable, for all those factory workers that are not so fortunate, I think it would be prudent for the government to use it's resources to cushion the impact for them and help their families through a transitional period rather than pour that money into a bottomless pit to satisfy the short term needs of the industry.
(Jet I know you probably think that is 'welfare' but which is better? you can't just leave people destitute, when they work hard for a living and the situation is not of their making.)
Anyway having a bit of a ramble here, so I'll just end by saying that the last couple of years I've been working on luxury cars as the market for them has been more profitable, but that too is now coming to an end. I'm now working on Aircraft for Emirates. However I feel the aricraft industry will be the next to fracture although I think it will be quicker to recover, due to the fact that there is more money available to companies like BA, Virgin and Ryanair to consolidate their position and aquire aircraft at lower rates.
I guess the Arab's must be thinking, 'crisis? what crisis!'
Time for a change of career, mmm... gas and oil, gas and oil.... :)
^ But Robski, you didn't tell us how much you make! :) (I know you are a skilled tradesman, so that differs IMO). Anyone who has a journeyman's ticket or the equivalent (sorry, don't know all the terms) is worthy of high pay, IMO.
True, I think it's welfare if folks just hang about waiting for the govt to save them, but I do support retraining programs.
Thanks, Bugs, for the updates on wages, etc. I wonder where the $75-$78 numbers came from in that article? Maybe adding benefits, but that's a far stretch from about $30. I do question union data tho.
How do Asian mfg in the US shut out the unions? In employee signing contracts?
The $70+ per hour is based not only on total cost of the current employees but the legacy costs related to ALL of the retired employees as well.Quote:
Originally Posted by Jet Gorgon
The Asians have been able to keep the unions out by opening plants mostly in non-union areas (the South). They have a few in the North but not in strong union areas. In addition they typically offer wages that are 50% hirer or more than the average local manufacturing wage. For example in say Mississippi, the average wage is say around $12-$13, they go in and open a plant with a wage of around $20 per hour. Now that is still 30% or so less than the big three pay, but it’s around 50% more than any other non-skilled manufacturing job within hundreds of miles. Throw in the benefits and the locals don’t see the need to pay a union to get more – they are already rolling in dough compared to everyone else within a hundred plus miles.Quote:
Originally Posted by Jet Gorgon
I am not sure if they require them to sign a contract or not, but even if they do I think it is illegal to lock the unions out with any type of employment contract. The employees could still unionize and not void any existing contract.
But again when folks are making 50% more than anyone else doing similar work in the area, with benifits, they don't see the need to form a union and pay dues.
Additionally the biggest problem IMHO for the big three right now are the legacy costs. There is simply no way for them to get out from under them, and no way for them to compete if they have to pay them. And sure these costs are not just the fault of the unions or the employees - the management agrees at one point to pay them. But they were based upon the hayday of operations, back when they had tons more workers and were making lots more money. In a way it is kind of like the problem the US is running into with social security, less and less people paying into the system to cover the costs. The big three end up with less and less workers every year, but they have to cover and increasing legacy costs.
One thing I have been kicking around in me head as of late would be something along the lines of kicking the existing legacy costs of the big three over and into the PBGC, but this would have to be as part of some kind of chapeter 11 or the like, and requrie ALL of the top exects and board members to be shown the door with no pay.
Pension Benefit Guaranty Corporation (PBGC)
Pension Benefit Guaranty Corporation - Wikipedia, the free encyclopedia
If I recall not too long ago GM tried to kick the legacy costs over to the union buy offering up X billions of dollars and let the unions take it from there. Did not work, but if GM makes it thru the current mess I look for the X to continue to grow until the union get greedy enough to take it. Then the retirees will end up getting screwed by the union instead of GM.
Once again, the Legacy costs can be put at the foot of management. The Pension fund is not an asset of the Company, it is owned by it's employees. Somehow or other some companies have been able to plunder their workers Pension fund though, like United Airlines- I don't think this should be allowed. GM failed to adequately fund it's pension fund- this has been talked about for several years, and I imagine things are even worse in the current environment. So it is left with several billion dollars of contingent liabilities.
While we're on this topic, I'd like to know more details about how United Airlines got a legal judgment to reneg on the pension plan for its employees.Quote:
Originally Posted by sabang
After many employees signed a pension agreement, and had already invested years and years of their life working with the company, to have the company say, "we're paying out less than the agreement."
This means many employees will be working longer than they thought the would.
There was a court ruling on this a couple of years ago.
Anyone want to expand on this in a new thread? Perhaps a pension thread?
TIA.
^ I think it fits better in this one, MM. Unless we start a union, benefits, pension thread? Maybe interesting to compare these issues across countries.
Bugs, thanks for the non-union info. Makes sense for those folks and for the companies. I know workers in Japan are unionised, but a very different system. That is also changing as life-time employment is not as prevalent anymore.
American car companies are too old to change their ways. You can't teach an old dog new tricks. For too long they tried to dictate to the American public what type of car they should drive.
stated a threadabout this ages ago.
Pretty sure people said Gm wasn't going to go bust in that thread.
soebody dig it up
Yes, that will be me. I posted this in July:Quote:
Originally Posted by mrsquirrel
https://teakdoor.com/us-domestic-issu...tml#post680578
Of course, Butterfly's responding follow-up post stated that he didn't understand. But then again, he never does.
Further back, in February, I posted this:
https://teakdoor.com/issues/24787-bri...tml#post533337
Most people have rejected what I have said on the current economic situation since I joined the board, only to now acknowledge that I was correct.
I draw comfort that some, such as Butterfly, continue to disagree, given his lamentable track record.
:)
:pullsleigh:
Heard on the news again about GM union members making $75 an hour, but it includes pension and benefits.
Here's news on Wagoner, GM's chairman and CEO
Wagoner has run the world's largest automaker for the past eight years, presiding over $73 billion in losses beginning in 2005. He already endured a fight with dissident shareholders and several failed turnarounds and may argue he knows the company better than most who could take his job.
The 55-year-old executive joined GM in 1977, as U.S. automakers were fending off Japanese competitors who recognized the need a decade earlier to build fuel-efficient vehicles. While U.S. auto sales broke records during Wagoner's years as CEO, the three major producers -- Ford, Chrysler LLC and GM -- battled against high labor costs from pension and retiree health care obligations.
...
Senator Grassley, an Iowa Republican, said in a letter yesterday to the three auto leaders that they should follow Iacocca's example and cut their own pay. Iacocca took a $1 yearly salary and his executives as much as 10 percent less after the bailout, according to the letter.
...
Aid to the automakers must come with conditions that reduce their U.S. production costs to match or beat those of Toyota, said Crandall, who managed a unionized workforce as American Airlines CEO from 1985 to 1998.
Toyota generated pretax profit of $922 per vehicle on North American sales in 2007, while GM lost $729, according a June report by a New York-based consulting firm.
Bloomberg.com: Exclusive
How much did Wagoner make?
Rick Wagoner, chief executive of General Motors Corp., announced in June the company had to close four plants that make trucks and SUVs because of lagging demand as fuel prices soar. That followed the posting a $39 billion loss in 2007, a year when its stock price fell by about 19 percent, without adjusting for dividends.
And Wagoner? His pay rose 64 percent, to $15.7 million.
CEOs pay chugged higher in '07 despite economy; GM's Rick Wagoner's pay rose 64 percent -
Well, that is a drop in the bucket compared to the total losses, but if mgmt took pay cuts, it would be easier to negotiate cuts with the unions, too, IMO.
The $25 bil the industry wants won't do anything. A big bladdy band-aid is all it is, and it will just delay the inevitable. Let them file for bankruptcy and then restructure. Design jazzy new hybrids that people want to buy. Remember the beloved Ford Mustang? Sure, gas prices have fallen dramatically, but it can't last and what good are cheaper prices if folks are out of work? Typically, prices for all goods, including groceries, have risen dramatically over the past few months, in line with skyrocketing fuel and commodity prices. Well, all of those prices have fallen, but have retail prices? No. I am still angry that Safeway's Kaiser rolls cost $0.19 apiece a few months ago. The price rose to $0.32. And that's where they stay despite the drop in input costs. I wonder how low-income people can afford to feed their families.
Sorry, I digress...