Page 1 of 6 1 2 3 ... LastLast
Results 1 to 25 of 135
  1. #1
    Suspended topspeed's Avatar
    Join Date
    Jun 2003
    Location
    California
    Posts
    3,717

    Automotive Bailout vs. the morons in Washington

    GM and Chrysler just announced that they need $30 billion in loans/credit lines or will face bankruptcy by March. This amount includes the $17b already approved by Washington.

    Here's the rub, it you didn't catch the witch hunt the jacka$$'s in DC put the Big 3 through, the one thing that became painfully obvious was that the politicos haven't the faintest clue as to how the automotive industry works. They don't realize most vehicles have a 4 year development period. They can't comprehend the amount of engineering and innovation involved in trying to design a car that is economical enough to reach their pipedream 35mpg CAFE standard in the face of ever more stringent safety standards and market demands for more gizmos (both of which add weight, which in turn makes a car less economical!). You can't just stop GM or Chrysler on a dime and turn the sucker around. These companies aren't Corvette's, they're Peterbuilts with triple axle trailers!

    Pelosi, that clueless b!tch, has stated she hopes Obama's new autos task force will help the "transformation of our domestic automobile industry into a viable, technologically advanced, and globally competitive manufacturing force."

    Uh, huh.

    Ford's Fusion Hybrid, developed solely in house without government funding (unlike Toyota's Synergy Hybrid system), betters the Camry Hybrid by 8mpg(!) city, is actually fun to drive, and is built just as well, if not better than the Camry or Accord.

    The European Ford Mondeo is a Car of the Year and the new Fiesta is recognized as the "A" class standard. Not the VW Polo. Not the Yaris. Not the Fit.

    A C6 Corvette will go toe to toe with any sports car on the planet...at half the price and with better mpg. The ZR1 has repeatedly beaten Ferrari Scuderia's, Lambo LP560/4's, and Porsche GT2's in comparisons, regardless of price. Factor in the the 2X-5X premium for the Euro's and it's nolo contendere.

    The Pontiac G8 offers BMW M5 performance for half the price. It is also likely much more reliable.

    The Caddy CTS-V offers better performance than the M5 with a $20,000 discount to boot!.

    However, if you are to believe Pelosi and the rest of her cronies, American's can't build a car worth a damn.

    The Wall Street crooks that put us in this mess knew exactly what they were doing, and yet we hand over $750 billion (as an appetizer) with no questions asked. Auto manufacturers face the worst market in 40 years with overall sales down to an estimated 10.2 million units (compared to 17 million units in '05) and are being blamed for their own malaise. This has hit everyone: Toyota is posting it's first loss...EVER...of $2.1 billion after recording a $20 billion profit for the previous year.

    GM is already cutting 45,000 jobs, 4 car lines, and closing 5 plants to survive. That represents and drop in the bucket compared to the ripple effect of what will happen should the largest automotive corporation (and 5th largest corporation, period) go bankrupt. Suppliers, engineering firms, R&D companies...every last one of them are history.

    Look, I'm not defending GM or Chrysler's poor judgement. The Aztec and Aspen certainly merit a "WTH?" response. That said, we can't have the largest, most influential car market in the world and only have one (Ford) domestic manufacturer. That's absurd. We can't become England.

    /rant
    Last edited by topspeed; 02-17-2009 at 05:59 PM.

  2. #2
    Loving This kexodusc's Avatar
    Join Date
    Nov 2003
    Location
    Department of Heuristics and Research on Material Applications
    Posts
    9,025
    You make some good points Speedy...take out the mistakes in labor contracts, bad vehicle decisions, and even some quality issues, and their still struggling near all-time lows like Nissan, Mazda, Toyota, etc...
    I've said it for years, it's cool to hate the US companies, so everyone gets on the band wagon.
    I worked for Honda for a bit several years ago, very low on the ladder of course, but I know internal competitive research concluded domestic vehicles in many classes had matched quality or exceeded in some areas, yet public perception was a mere fraction of Honda's. And it's just a glorified popularity contest in the end - facts be damned.

    It's hard to shed that bad image.

    On the other hand, I can guarantee you the Big Bath Theory is being exploited here. Whatever those car companies tell you they need, cut by half. They'll try and write off decades of bad business decisions and debt to start over again here. I'd do it too if I was them, get the most you can. By looking so bad in 2009 and 2010 the suits will come out smelling like the cat's @ss in 2011 at the first sign of turnaround. Bah.

    There should probably be 2 US Auto manufacturers, and 1/2 the number of dealerships. But what do I know. I'll let the experts figure this one out.

  3. #3
    JSE
    JSE is offline
    MIA - Until Rich is back! JSE's Avatar
    Join Date
    Feb 2003
    Location
    Denial
    Posts
    1,929
    I know this will anger some here but I think GM, Chrysler and probably Ford before it's all said and done, need to go through a managed bankruptcy. I say let them fail and help them rebuild. I'm not sure there is any other way for them to get out from under and correct their operating structure (not sure of the correct word/phrase there). I don't think they will ever be able to exist again as is. They need to trim the fat, get lean and more efficient. No way the unions will allow them to do this but bankruptcy could force their hands.

    I want the big three to survive but I think the only way to change their corporate ideolgy is to tear them down and build them back up. As it is now, we are just throwing money into sinking ships.

  4. #4
    Shostakovich fan Feanor's Avatar
    Join Date
    Jun 2002
    Location
    London, Ontario
    Posts
    8,127
    Quote Originally Posted by topspeed
    ....
    Here's the rub, it you didn't catch the witch hunt the jacka$$'s in DC put the Big 3 through, the one thing that became painfully obvious was that the politicos haven't the faintest clue as to how the automotive industry works. They don't realize most vehicles have a 4 year development period. They can't comprehend the amount of engineering and innovation involved in trying to design a car that is economical enough to reach their pipedream 35mpg CAFE standard in the face of ever more stringent safety standards and market demands for more gizmos (both of which add weight, which in turn makes a car less economical!). You can't just stop GM or Chrysler on a dime and turn the sucker around. These companies aren't Corvette's, they're Peterbuilts with triple axle trailers!
    ..
    The rub, indeed, is that the North American automakers have had 40 effing years to smarten up and failed all the while.

    Circa 1970 or '71 I walked from the Volvo dealership to the Ford dealership to check out the Torino mid-sized. When I mentioned Volvo, the salesman laughed distainfully: "There'll be a few people interested in those foreign makes because they're exotic, but most people don't and never will want them." hah HAH. It was head-in-the-sand for decades, and vestiges of that attitude persist right up to today.

    We're in for a damned hard recession. There is certainly no justice in bailing out these greedy, stupid auto companies and their greedy, stupid unions when so many others will hurt as bad or worse. Maybe I agree with JSE: let 'em fail, then pick up the pieces.

  5. #5
    abNORMal IBSTORMIN's Avatar
    Join Date
    Jan 2003
    Location
    Blue Springs, MO
    Posts
    246
    Quote Originally Posted by Feanor
    We're in for a damned hard recession. There is certainly no justice in bailing out these greedy, stupid auto companies and their greedy, stupid unions when so many others will hurt as bad or worse. Maybe I agree with JSE: let 'em fail, then pick up the pieces.
    Add to that the greedy, stupid banks. NONE of them should have been given a bailout. The recession is here my friends. The smart businesses that played it straight will survive and the ones that didn't should learn from it, not be bailed out just to do it again because there are no consequences (Don't worry about it, the Government will bail us out again if we get into trouble!). Where IS all this money the government is throwing around coming from?

  6. #6
    Musicaholic Forums Moderator ForeverAutumn's Avatar
    Join Date
    Jan 2003
    Posts
    9,769
    Quote Originally Posted by JSE
    I know this will anger some here but I think GM, Chrysler and probably Ford before it's all said and done, need to go through a managed bankruptcy. I say let them fail and help them rebuild. I'm not sure there is any other way for them to get out from under and correct their operating structure (not sure of the correct word/phrase there). I don't think they will ever be able to exist again as is. They need to trim the fat, get lean and more efficient. No way the unions will allow them to do this but bankruptcy could force their hands.

    I want the big three to survive but I think the only way to change their corporate ideolgy is to tear them down and build them back up. As it is now, we are just throwing money into sinking ships.
    I'm with you JSE. I feel bad for all the workers and other businesses that would be affected. But it's not right for my taxes to be used to bail out a troubled business. I'd rather see my tax dollars go towards padding the Unemployment Insurance benefits to help the families involved, while these companies are restructured to be more efficient in the future. And find a way to put a leash on the union. I'm all for protecting the workers but there comes a time when the cost of all of that protection is just going to backfire. That time is now.

  7. #7
    Suspended topspeed's Avatar
    Join Date
    Jun 2003
    Location
    California
    Posts
    3,717
    Quote Originally Posted by IBSTORMIN
    Add to that the greedy, stupid banks. NONE of them should have been given a bailout. The recession is here my friends. The smart businesses that played it straight will survive and the ones that didn't should learn from it, not be bailed out just to do it again because there are no consequences (Don't worry about it, the Government will bail us out again if we get into trouble!). Where IS all this money the government is throwing around coming from?
    From US! You know, the ones that were stupid enough to not get greedy and over-extend ourselves while trying to keep up with the Jones'. We work our buns off to pay our mortgages, pay our taxes, pay our bills. And what do we get for it? We get to pay for some CFO's golden parachute and Gulfstream they gleefully gut their company.

    Quote Originally Posted by Cartman
    I know this will anger some here but I think GM, Chrysler and probably Ford before it's all said and done, need to go through a managed bankruptcy. I say let them fail and help them rebuild. I'm not sure there is any other way for them to get out from under and correct their operating structure (not sure of the correct word/phrase there). I don't think they will ever be able to exist again as is. They need to trim the fat, get lean and more efficient. No way the unions will allow them to do this but bankruptcy could force their hands.
    Quote Originally Posted by FA
    And find a way to put a leash on the union. I'm all for protecting the workers but there comes a time when the cost of all of that protection is just going to backfire. That time is now.
    This is the ONLY upside to bankruptcy. The UAW has stated they have made concessions, just not nearly enough. The Job Banks have to stop. The UAW needs to understand they are cutting off their nose to spite their face. Holding management hostage is not a bargaining technique, it's destroying our ability to build a competitive product. Washington wants higher quality? No problem. "Greener" cars? Easy. BlueTooth, voice controlled navi, and complete iPod integration? Simple. Despite what Washington belives, domestic automakers are willing and able to provide all of this right now. All it takes is money.

    Average wage for a UAW member: $71/hr.

    Average wage for non-union right-to-work employee: $30/hr.

    Slice your labor cost in half and see how much more content and quality you can put into a vehicle at the same price point. Amazing, huh?

    Quote Originally Posted by feanor
    The rub, indeed, is that the North American automakers have had 40 effing years to smarten up and failed all the while.
    I disagree. Toyota has been trying to crack the largest sector in America (full sized trucks) for over 25 years and still haven't gotten it right. The new Tundra factory in Texas, a project that went over budget by $400million, was shuttered for 3 months because vehicles are sitting on the lots. The Nissan Titan is going to become a re-badged Dodge Ram. The Fusion and Malibu are better cars than the Camry or Accord according to the press. The Focus routinely outsold the Civic during the '90's.

    Kex hit it on the head: it's public perception. The press wax poetic about the Prius, yet fail to tell you the carbon footprint to build it far exceeds that of a Ford Focus. American manufacturer's have been given a bad rap. Sure, the cars made in the '70's sucked. No question. However, they got their act together and brought us such semianl vehicles as the '86 Taurus, Jeep Cherokee, and Caddy CTS. Unfortunately, old reps die hard, whether deserved or not.

    There are so many layers as to why domestic manufacturers are in the plight they are in. Bad decisions, questionable product strategy, and over expansion all played major roles. However, technological leadership, innovation, and quality are not to blame. To say we can't build a competitive vehicle is simply wrong.

  8. #8
    Class of the clown GMichael's Avatar
    Join Date
    Apr 2005
    Location
    Anywhere but here...
    Posts
    13,243
    Quote Originally Posted by topspeed

    Average wage for a UAW member: $71/hr.

    Average wage for non-union right-to-work employee: $30/hr.

    .
    Where do I apply? I'll take either job.
    WARNING! - The Surgeon General has determined that, time spent listening to music is not deducted from one's lifespan.

  9. #9
    Forum Regular Sugar Beats's Avatar
    Join Date
    Oct 2008
    Location
    97.5, The Blaze
    Posts
    433
    Quote Originally Posted by IBSTORMIN
    Add to that the greedy, stupid banks. NONE of them should have been given a bailout. The recession is here my friends. The smart businesses that played it straight will survive and the ones that didn't should learn from it, not be bailed out just to do it again because there are no consequences (Don't worry about it, the Government will bail us out again if we get into trouble!). Where IS all this money the government is throwing around coming from?

    Here, here. I totally agree. All they are doing is printing more. Get those printing presses' a rollin'.
    All it's going to do is compound the debt we are already suffering from and the brunt of it will be felt for years to come. My kids, their kids.. and like that commercial, and so on & so on.
    Don't you like it on the sly? Don't you like it till it hurts? Have I been on your mind? What's a voice without a song?

  10. #10
    abNORMal IBSTORMIN's Avatar
    Join Date
    Jan 2003
    Location
    Blue Springs, MO
    Posts
    246
    Quote Originally Posted by Sugar Beats
    Here, here. I totally agree. All they are doing is printing more. Get those printing presses' a rollin'.
    All it's going to do is compound the debt we are already suffering from and the brunt of it will be felt for years to come. My kids, their kids.. and like that commercial, and so on & so on.
    My understanding is printing it lowers the value of the dollar overseas so they won't do that. We just borrow it from China, again. Soon we won't own the country and all we will produce here is babies. Of course we are importing those now too.

  11. #11
    Musicaholic Forums Moderator ForeverAutumn's Avatar
    Join Date
    Jan 2003
    Posts
    9,769
    Quote Originally Posted by IBSTORMIN
    My understanding is printing it lowers the value of the dollar overseas so they won't do that. We just borrow it from China, again. Soon we won't own the country and all we will produce here is babies. Of course we are importing those now too.
    Could you please print some money soon? I'll be in the US in April and I need the US dollar to get a little weaker before I come. The exchange rate is a b!tch.

  12. #12
    abNORMal IBSTORMIN's Avatar
    Join Date
    Jan 2003
    Location
    Blue Springs, MO
    Posts
    246
    Quote Originally Posted by ForeverAutumn
    Could you please print some money soon? I'll be in the US in April and I need the US dollar to get a little weaker before I come. The exchange rate is a b!tch.
    NoNoNO. I said they aren't printing money, at least I don't think they are and I don't want the dollar to get weak. What are you wanting a bailout like everyone else???

    Guys, where are we coming from? Where are we going to?

  13. #13
    Shostakovich fan Feanor's Avatar
    Join Date
    Jun 2002
    Location
    London, Ontario
    Posts
    8,127

    Not just the cars

    Quote Originally Posted by topspeed
    ...

    Kex hit it on the head: it's public perception. The press wax poetic about the Prius, yet fail to tell you the carbon footprint to build it far exceeds that of a Ford Focus. American manufacturer's have been given a bad rap. Sure, the cars made in the '70's sucked. No question. However, they got their act together and brought us such semianl vehicles as the '86 Taurus, Jeep Cherokee, and Caddy CTS. Unfortunately, old reps die hard, whether deserved or not.

    There are so many layers as to why domestic manufacturers are in the plight they are in. Bad decisions, questionable product strategy, and over expansion all played major roles. However, technological leadership, innovation, and quality are not to blame. To say we can't build a competitive vehicle is simply wrong.
    You are right that it isn't just the cars. Maybe not even primarily the cars which have indeed improved over the 40 years I spoke of. Certainly the techinology gap is much narrower today, although I'd say (as a matter of perception?) that most of the NA improvement has be the last decade. (BTW, I have myself driven exclusively NA cars for the last 27 years.)

    Funny you should mention trucks. As our sage, Kex, pointed out not long ago, mini-vans, pick-ups, and SUVs have buoyed the NA industry in recent decades and without them it would have foundered long since. But it was clear to anyone with the least foresight knew that the era of these gas guzzlers was bound to end, yet no provision was made for this inevidability.

    I think we agree that a big part of the blame goes to the unions. Needless to say they have always known that their workers were grossly over paid relative to other domestic workers. When foreign competition emerged -- and here I'm back to talking 40 years or longer -- the perceptive realized that the days of this disparity had to end eventually, but again, no concessions were made to inevidability.

    No, no, companies, shareholders, and present and former workers alike must be swept aside. If motor vehical manufacture is to survive at all in NA, the industry must be born anew on a wiser foundation.
    Last edited by Feanor; 02-18-2009 at 07:10 PM.

  14. #14
    abNORMal IBSTORMIN's Avatar
    Join Date
    Jan 2003
    Location
    Blue Springs, MO
    Posts
    246
    Quote Originally Posted by Feanor
    No, no, companies, shareholders, and present and former workers alike must be swept aside. If motor vehical manufacture is to survive at all in NA, the industry must be born anew on a wiser foundation.
    Maybe a new car manufacturer will arise from NA. Now would be the time. Someone with the guts and money to steal all the best from the big three as their ships sink and build a new NA car manufacturer using the resources of GM & Chrysler sold at auction at a fraction of the cost?

  15. #15
    Shostakovich fan Feanor's Avatar
    Join Date
    Jun 2002
    Location
    London, Ontario
    Posts
    8,127

    Sounds good

    Quote Originally Posted by IBSTORMIN
    Maybe a new car manufacturer will arise from NA. Now would be the time. Someone with the guts and money to steal all the best from the big three as their ships sink and build a new NA car manufacturer using the resources of GM & Chrysler sold at auction at a fraction of the cost?
    It's probably what's necessary. But who? Maybe the goverment could do it -- or, since we don't believe in socialism, maybe the goverment could bribe someone to do it through myriad concessions and guarantees.

  16. #16
    abNORMal IBSTORMIN's Avatar
    Join Date
    Jan 2003
    Location
    Blue Springs, MO
    Posts
    246
    Quote Originally Posted by Feanor
    It's probably what's necessary. But who? Maybe the goverment could do it -- or, since we don't believe in socialism, maybe the goverment could bribe someone to do it through myriad concessions and guarantees.
    With the government involved, it would probably be some foreign country they would give a tax break, concessions and guarantees to but they would have to disguise it with an NA figurehead. Kinda scary now that I said it!

  17. #17
    JSE
    JSE is offline
    MIA - Until Rich is back! JSE's Avatar
    Join Date
    Feb 2003
    Location
    Denial
    Posts
    1,929
    Quote Originally Posted by IBSTORMIN
    Maybe a new car manufacturer will arise from NA. Now would be the time. Someone with the guts and money to steal all the best from the big three as their ships sink and build a new NA car manufacturer using the resources of GM & Chrysler sold at auction at a fraction of the cost?

    I seriously doubt a totally new car manufacturer would come out of all this. However, I can definitely see consolidation into maybe 2 major companies. Maybe Chrysler would be merged into GM or Ford or maybe both? Dodge goes to GM and Jeep goes to Ford? Who knows.

    The one thing that is clear is they pretty much need almost start over from scratch. Like Kex hinted at earlier, we don't need 30 dealers for each brand in each big city. Here in the Houston, I bet there are at least 30 Chevy and Ford dealers while they are probably 8 to 10 Toyota dealers. It's ridiculous. I even think 8 to 10 Toyota dealers is too much.

  18. #18
    Loving This kexodusc's Avatar
    Join Date
    Nov 2003
    Location
    Department of Heuristics and Research on Material Applications
    Posts
    9,025
    I know a lot of taxpayers are mad and looking for blood, a punching bag etc....In all fairness, I just hope they do a bit of research, a bit of thinking, and don't fall victim to the easy way out that is making UAW the big scapegoat for all of this. They're maybe 20% of it max, but they get more bad publicity than the all the crappy managers and CEO's, lazy engineers, greedy shareholders, ignorant courts, and visionless governments over the last 4 decades that have created the environment that exists today.

    These are people at the end of the day and I don't like seeing anyone persecuted more than they deserve.

    True, they do introduce some bloat to the cost structure, and they are terribly unwilling to concede compensation levels that are unhealthy for the companies that employ them, but as I try to tell people, a large majority of that bloat was never predicted or intended by the UAW, and the reality is even if UAW labor costs were cheaper than transplant (Honda, Toyota etc) labor costs, we'd still be in the same situation we are in now - 2 companies on the verge of bankruptcy and another not far behind.

    If you believe the Union, union labor costs are only 10% of production costs for vehicles. If you believe Ford or GM it's closer to 13-14%. Split the difference, and we're still only talking a competitive disadvantage of 20% or so on a chunk of 10% or so of the cost of vehicles. Do the math on the impact on final price of the vehicle it's only a few percent. Granted that's a big difference in an extremely oversaturated market, but considering domestic vehicles are still cheaper for the large part, price isn't everything. Is it too impossible to demand that GM and Ford make up that 2 or 3% disadvantage somewhere else on the other 90% of costs? I guess it is.

    If it was just labor - we would expect GM, Chrysler, Ford etc to be proportionaletly behind the ball - But are things at GM, Chrysler and Ford only 3% or 4% , even 8% worse of than Honda, Toyota etc right now? Not even close...so there's plenty more blame to get thrown around out there, but nobody knows who those guilty parties are, so back to UAW bashing.

    The labor rates Speedy posted above are consistent with what I've seen at $71/hr if we look at the largest figures for pensions and insured benefits. If you consider the concessions the UAW has given in recent bargaining rounds (ie, changes to VEBA, bringing compensation in line with non-union transplants, etc) that figures drops to $58/hr. When you consider that the average transplant workers' compensation is around $48 that's not nearly as shocking. This leads me to believe that gap is going to get bridged soon enough.

    There's been a lot of talk about how the so called legacy costs are to blame - and, well, to a certain extent they are. Of that $71 figure, $16/hr is attibutable to legacy costs for retirees. Those are benefits for people that were bargained for in good-faith and agreed to by management in the past. That $16/hr disadvantage was never anticpated to be so much by the UAW, or managers and all their consultants when those benefits were awarded. I've spoken before about the actuarial science behind funding benefit plans, but these things have snowballed into costing several times more than the worst-case assumptions used back in the day...It's not like UAW went out there to bankrupt these guys, but every time there's a problem, they get the most criticism and are expected to give up the most concessions. If I was retired with the promise of a pension that was guaranteed to me in good faith, I'd be pretty damn pissed off too if people came back and said we need you to downgrade your lifestyle until you die. But I know why people blame them...you can't undo all the other gaffs, and the only constantly scapegoat in all this is the union. It shouldn't have been negotiated, but management was too damn worried about the impact on the bottom line for a few quarters or a year too worry about the long term handicap they were locking themselves into. That's not a line workers' mistake.

    Well Kex is gonna make a bold prediction - the Auto companies are going to get bailed out, the labor costs are going to move inline with the transplant companies very fast, and in 7 or 10 years we're going to see a US auto company still teetering on the brink of disaster, because all the focus is on labor and productivity, not distribution, marketing, or design. And even if it was, there's too many players in the market and only the very best can make a buck. We'll be back in 10 years talking about another crisis. Only then there will be nobody left to blame except a culture that has always been focused on short-term gain.

  19. #19
    abNORMal IBSTORMIN's Avatar
    Join Date
    Jan 2003
    Location
    Blue Springs, MO
    Posts
    246
    Quote Originally Posted by kexodusc
    I know a lot of taxpayers are mad and looking for blood, a punching bag etc....In all fairness, I just hope they do a bit of research, a bit of thinking, and don't fall victim to the easy way out that is making UAW the big scapegoat for all of this. They're maybe 20% of it max, but they get more bad publicity than the all the crappy managers and CEO's, lazy engineers, greedy shareholders, ignorant courts, and visionless governments over the last 4 decades that have created the environment that exists today.
    When UNSKILLED labor that is worth $10/hour is making $71/hour AND have the arrogance to think they have the right to that much money, it pisses people off.
    Anyone can put a bolt in the same place on the same car on an assembly line all day.

    I know of a small refractory company owner that was ruined by a union steward he would not give in to. The steward got mad one day, closed the owner's office door and told the him that if he didn't agree to his demands, he was going to ruin him. The owner said the damands were ridiculous and he didn't give in. The union steward then stirred up so much trouble that within a year, the man had to close his doors. He couldn't get anybody to work, he was late on orders, he lost customers, etc. EVERYONE that worked for him LOST THEIR JOBS. He said it broke his heart when his workers came to him and asked what they should do now. How did the union steward and the union itself help it's people in that situation?
    The UAW is all about power, just like this scenario they can't see the forest for the trees. Granted, the car companies have made mistakes but I have worked in non-union and union dealerships and the union people have an arrogance to them that make it a difficult place to work. The arrogance needs to stop. Too bad they took it this far. The unskilled will be making $10 an hour soon as they should be. The skilled will not have it easy but should have transferable skills.

    The biggest problem is, manufacturing is leaving the U.S. and that's NOT just a car company problem.
    Last edited by IBSTORMIN; 02-19-2009 at 09:56 AM.

  20. #20
    Musicaholic Forums Moderator ForeverAutumn's Avatar
    Join Date
    Jan 2003
    Posts
    9,769
    Quote Originally Posted by kexodusc
    There's been a lot of talk about how the so called legacy costs are to blame - and, well, to a certain extent they are. Of that $71 figure, $16/hr is attibutable to legacy costs for retirees. Those are benefits for people that were bargained for in good-faith and agreed to by management in the past. That $16/hr disadvantage was never anticpated to be so much by the UAW, or managers and all their consultants when those benefits were awarded. I've spoken before about the actuarial science behind funding benefit plans, but these things have snowballed into costing several times more than the worst-case assumptions used back in the day...It's not like UAW went out there to bankrupt these guys, but every time there's a problem, they get the most criticism and are expected to give up the most concessions. If I was retired with the promise of a pension that was guaranteed to me in good faith, I'd be pretty damn pissed off too if people came back and said we need you to downgrade your lifestyle until you die. But I know why people blame them...you can't undo all the other gaffs, and the only constantly scapegoat in all this is the union. It shouldn't have been negotiated, but management was too damn worried about the impact on the bottom line for a few quarters or a year too worry about the long term handicap they were locking themselves into. That's not a line workers' mistake.
    Where does it stop, I ask. This morning I read that GM Canada is asking the Federal and Provincial governments for assistance with funding their pension plan. The bulk of this liability will fall on the Ontario government since most of GMs Canadian operations are in Ontario and pensions are provincially legislated.

    As an Ontario tax payer, I oppose this move. Someone managed to negotiate retirement plans that were far too rich to be realistic and now it’s up to unrelated tax payers to bail them out.

    I understand the domino effect that will happen (mainly in Ontario) if GM went belly up and I can live with pitching in to ensure that people stay employed and businesses stay viable. But to now be asked to fix a broken pension plan on top of that just makes me steam. Who’s fixing my pension plan?

  21. #21
    JSE
    JSE is offline
    MIA - Until Rich is back! JSE's Avatar
    Join Date
    Feb 2003
    Location
    Denial
    Posts
    1,929
    Quote Originally Posted by kexodusc
    Lots of good info............

    I agree that labor costs are only part of the problem. The big three really need to be completely overhauled from top to bottom. They need to be forced to make major and drastic changes. From top to bottom, there are too many overpaid, under performing, greedy, set in their ways, stubborn, non creative, fossils taking up space within the walls of the big three. Weed these people out and start over with fresh ideas and a new corporate structure and culture.

    I also worry nothing will really change once they are bailed out. We will put a bandaid on the problem and buy a few more years (if that) but eventually we'll be right back at this point. That's why they need to fail to survive. I really don't see any other way.
    Last edited by JSE; 02-19-2009 at 08:31 AM.

  22. #22
    Shostakovich fan Feanor's Avatar
    Join Date
    Jun 2002
    Location
    London, Ontario
    Posts
    8,127

    Save the best 'till last

    Quote Originally Posted by kexodusc
    ...
    Well Kex is gonna make a bold prediction - the Auto companies are going to get bailed out, the labor costs are going to move inline with the transplant companies very fast, and in 7 or 10 years we're going to see a US auto company still teetering on the brink of disaster, because all the focus is on labor and productivity, not distribution, marketing, or design. And even if it was, there's too many players in the market and only the very best can make a buck. We'll be back in 10 years talking about another crisis. Only then there will be nobody left to blame except a culture that has always been focused on short-term gain.
    Your last paragraph is the best because it is there that you tacitly acknowledge the problem rather than just apologizing for the UAW.

    No, it isn't all just the fault of the UAW. Personally I never said that. But the mistakes have been clear and obvious for decades; the NA makers have been -- reluctantly, I should say -- playing catch-up with foreign makers. Their recent successes, as mentioned by topspeed, are too little and too late. It need not have been that way except for greed and lack of foresight.

    North American auto companies are, ultimately, not compeditive with the off-shore manufacturers. Or in some form, they might continue to be compeditive assembling cars here, but the parts will be made off-shore by workers earning $0.10 on the dollar vs. UAW. Either way, the solution isn't going to include UAW @ $71/hr.
    Last edited by Feanor; 02-19-2009 at 09:47 AM.

  23. #23
    Loving This kexodusc's Avatar
    Join Date
    Nov 2003
    Location
    Department of Heuristics and Research on Material Applications
    Posts
    9,025
    Yep, my personal, mine-all-mine, biased, un-PC opinion is that no fewer than 2 major automakers have to fail (1 US, one foreign) and that whole industry has to change from the point of sale back to the drawing board.

    FYI, full disclosure. First, I'm not apologizing for the UAW - they've made enough stupid mistakes and sold out enough of their own membership over the years that nobody can say they aren't deserving of a portion of the pain. Their lack of vision and unwillingness to be a partner in the industry will be their downfall.

    I'm a bit different than you guys maybe, I go to meetings several times a week and have to put up with too much anti-union rhetoric from my clients who are mostly large employers with unions of their own. It's taking its toll on me. I'm not a union sympathizer per se...my family ran car dealerships in the US until they went under a few years back, and they had to fight unions too, much to their demise, I have good cause to have a personal anti-union vendetta.

    But I just wish the people at the top, would get their share of the blame - not just passing criticism about a few CEO's flying jets to D.C. to ask for bailout money, but real, country ruining criticism. Right now they're being "asked what do you need?" Instead they should be asked "What would you like for your last meal?"

    I hate that one party is taking 90% of the blame for a much smaller portion of the cause. They are less popular than Hitler these days and they are the ones that are going to get hurt the most. Hell, a lot of those union guys could give a rats ass about the UAW, they just want to work, and those are the terms. Start any decertification nonsense, and your dog goes missing and car gets vandalized...bah. Union haters. You'll get your pound of flesh soon enough. But at the end of the day you won't feel any better.

    As for bailouts - I'm not opposed to them. If the investment in the bailout even breaks even over time, it's good. One could argue the means of production is a necessary expense to have in domestic borders. If it makes a penny or two, even better. I dunno...it's bailouts without a viable action plan for recovery and repayment I struggle with. I'm just not convinced there's going to be enough substantial change, but hopefully I'm wrong.

    Bah...this stuff takes Kex to a dark place and he's gonna try and stay out of it.

  24. #24
    Musicaholic Forums Moderator ForeverAutumn's Avatar
    Join Date
    Jan 2003
    Posts
    9,769
    Quote Originally Posted by kexodusc
    But I just wish the people at the top, would get their share of the blame - not just passing criticism about a few CEO's flying jets to D.C. to ask for bailout money, but real, country ruining criticism. Right now they're being "asked what do you need?" Instead they should be asked "What would you like for your last meal?"
    Great statement.

  25. #25
    Suspended
    Join Date
    Apr 2004
    Location
    Out there
    Posts
    6,777
    Not to over-simplfy, and as usual kex you're right on the money, but more and more, each day that goes by I want to just move the hell out of this country.

    BTW,

    $75 billion to help stop mortgage foreclosures.

    $750 billion+ to bail out the banks (Greenspan says nationalizing the banks may not be a bad idea)

    $17 billion and potentially $30 BILLION more for the auto makers

    Nationalization? Isn't that what happaens in SOCIALIST countries?

Page 1 of 6 1 2 3 ... LastLast

Thread Information

Users Browsing this Thread

There are currently 1 users browsing this thread. (0 members and 1 guests)

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •