UAW refuses pay cut

[JSFM35X]

Unions were put in place decades ago when Owners or companies put profit before safety, wages and other benefits for workers. Unions essentially put it to the bosses, pay or shut down. They(unions) got stronger. Soon, the unions were running the show. Without skilled labor some trades would be non existant.

Today, we have minimum wage laws, OSHA safety regulations and other federal guidlines. Unions only serve to protect bad employees. I am NOT say all Union workers are bad, but the system breeds medioricroity.(Spelling) If you are a great worker, you make the same as the "slacker' right next to you. If you use all your sick time to go fishing you get the same raise as the guy who showed up and made something. Fill a whole system like GM, Ford and Crysler with thousands of employees and you have a bloated, non productive industry where the workers have the executives by the shoprt hairs. I think we need to automate the manufacturing of car more and more so that we can build the cars with less "Overpaid " labor. Then these guys can go into the real world and work for a living. By automating the system, we have the freedom of saying, if you don't like working here leave, we can quickly train another employee to do your job. Don't let the door hit you on the A$$ in the way out the door! Wait and see the productivity to will get. Pride is almonst dead in our manufacturing. Why should they work hard, they are protected. Hell, I rather stay home at 95% pay! I drag my butt out of bed at 5AM 5 days a week just to make sure I get my work done so i can have dinner with my family. And, no i do not get OT. i jjust want to keep my job and suceede.

I believe the UAW is to blame 90-95%, Not every union worker! but the corporate UAW is to blame. I am sure management wastes the other 5% 0r so. I hope this serves as a change in the country unlocking the death grip the unions have on the country. Everyone should earn as much as they can. If you are worth 70.00 per hour, you will get it in a free market economy. If you can't prove your value at plat A go to plant B work hard and get promoted. There are also those jobs unfortunatly, that are only worth X dollars, Sorry. I would like to get paid enough to live like the guys on cribs, but I cannot not. i get up everyday and try to do better and better. It is a slow, long road filled with the good, bad and the ugly.

Sorry for the rant, but this is simple in my mind. Get the best job you can with the skills, and effort you have. Dont ask society to pay you for sitting home! The workers of the USA deserve to be paid sufficiently, have benefits that are possible under thier companies structure and be safe from hazards at all times.

Just my 2 cents!

[jfelbab]

My thoughts on this are that if I m asked to loan someone money I want some assurances that they will pay it back. I've not seen much to indicate thet the big three will be able to pay my loan back. First, they have been to the private sector looking for money and been refused. This signals to me that the odds of a payback are slim in the near term.

Next when I look at the profitability of GM and Ford over the past 5 years and exclude the financial crisis of the last few months I also see no reason to expect any ability to repay my money. They have been losing market share and money consistently over the last 5 years.

I do feel very saddened by those who are affected by this failure but I also am irate that the management of these firms in a word are like vampires, sucking the last blood from the dead corpse.

I believe that loaning money to these companies will only delay their day of reckoning. The only difference is that I wall be out a lot of money then too. This bail-out will just delay the day that I will be asked to pay for extended unemployment benefits only at that later date I , my children and my grand children, will no longer have any money either.

The big 3 are not making vehicles that enough Americans want, at a price they are willing to pay, or they would not be losing market share day by day. Others point out how they have made good strides in quality but I think that is not proven by the facts. I see in a recent CR magazine that the big three quality is still not on a par with some transplants. That report states that Japanese automakers dominated a survey of the most reliable new vehicles.

Consumer Reports named 47 vehicles to its list of most reliable for 2007. Of those, 39 were from Japanese automakers, including an industry-leading 21 from Toyota.

Honda had the second-highest tally, with 11 earning a most-reliable designation.
[quote]A total of 20 vehicles on the least-reliable list were from U.S. automakers, including 12 from GM, five from Ford and three from the Chrysler Group.

CATEGORY / MOST RELIABLE
Small cars: Honda Fit
Family cars: Honda Accord Hybrid
Upscale cars: Lexus ES350
Luxury cars: Lexus LS (2006)
Sports cars: Lexus SC
Minivans: Pontiac Vibe
Small SUVs: Toyota FJ Cruiser
Midsized SUVs: Toyota Highlander Hybrid
Large SUVs: Toyota Land Cruiser
Pickup trucks: Subaru Baja

To be fair Ford did have a couple of promising new models which showed well in initial quality. Yet this CR list was compiled from actual vehicle owners (over a million) which carries a lot of weight.

Kelly Bluebook ratings list of top 10 vehicles include none from the Big three. Their list of the top 15 highest resale value vehicles include only two from the big three, the Caddy CTS and the Jeep Wrangler.

Edmunds list of the top 10 residual value for 2008: Top 10 Cars With the Best Residual Value for 2008

OK, the point is not to trash the big three but saying everything is all better now just doesn't gel with all the data.

This info is part of the reason I just scratched the CTS off my purchase list. I've owned problematic cars from the big three in the past, a lot of them in fact. I've almost forgotten how poorly I was treated at their dealerships. I recently visited a Caddy dealership to look at the CTS and took a stroll into the service department. It was a filthy, grimy, dimly lit cave of a place. Several mechanics were arguing with each other and I clearly felt I would not want them touching my vehicles. I observed a mechanic wiping the side of a vehicle with an oily shop rag after he spilled oil on the car. Granted this Caddy dealership may not be representative of them all, but this is the closest one to my home and will not be my dealership.

In contrast I looked at a nearby Lexus service department. The place was spotless, was well organized, and well lit. The service manager said that every vehicle was taken off the floor every evening and the floors were scrubbed clean. I got the feeling of extreme pride and professionalism from speaking with him.

This post is getting long so let me summarize my position. Until the big three "gets it" they won't be selling me a vehicle nor will they be getting my support for a "bail-out" loan. I just don't see any way they can remain viable and thus pay the loan back.

Depressed, you bet I am. American iron is what I grew up with and I wish it was at the top of the heap today. Sadly, wishing it be so, doesn't make it so. I wish there was a way to make the big three successful again but for the life of me I don't see it.

[billium]

And their line folks are all union (may be UAW)?

LenA, I defer to your knowledge on current pension law. I'll refer you to United Airlines, their many unions and how that one ended. Again, to the gist of my proposal - give employees a reason to think in terms other than "them" (management) and "us". For that to happen, current management needs to be euthanised and current "labor" needs a reality check. I don't see that happening in the current management/union environment. I, for one, have heard the "we're about to turn the corner" baloney one too many times to beleive it anymore from US auto makers. I'll be on board with my tax dollars being "loaned" to them once current management is unemployed and the unions and their members are in line with others in the industry. Not only from a pay standpoint, but also from an effeciency and flexiblity standpoint. I'm not holding my breath on any of it.

I believe Deere went to a two-tier pay system more than a decade ago (may be closer to two). Even so, they still have significant "legacy" costs. But management & labor have similar goals (quality of product, efficiency of the manufacturing process and profitablity). Their product is viewed as high quality not only in the US, not only in North America, but worldwide. Could that be part of the answer?

So tell me, how is it that one American manufacturing giant, using union labor, can be at record profits for at least the past five years while the domestic auto industry is at the opposite end of the spectrum. Before anyone replies, I'll conceed gas prices and the domestic automakers love of high profit SUV's as to their losses for the past 18 months. So lets use 2006 as a reasonable reference point. My assertion, management, labor and product. Deere management made hard choices years ago regarding labor. I remember at the time management was chided as heartless to the needs of the working man, et al. But their men and women are still working, still making by any standards a very good living. Their product is viewed worldwide as one of the highest quality within the industry. What am I missing?

Batter up.

[Len_A]

Originally Posted by billium

And their line folks are all union (may be UAW)?

LenA, I defer to your knowledge on current pension law. I'll refer you to United Airlines, their many unions and how that one ended. Again, to the gist of my proposal - give employees a reason to think in terms other than "them" (management) and "us". For that to happen, current management needs to be euthanised and current "labor" needs a reality check. I don't see that happening in the current management/union environment. I, for one, have heard the "we're about to turn the corner" baloney one too many times to beleive it anymore from US auto makers. I'll be on board with my tax dollars being "loaned" to them once current management is unemployed and the unions and their members are in line with others in the industry. Not only from a pay standpoint, but also from an effeciency and flexiblity standpoint. I'm not holding my breath on any of it.

I believe Deere went to a two-tier pay system more than a decade ago (may be closer to two). Even so, they still have significant "legacy" costs. But management & labor have similar goals (quality of product, efficiency of the manufacturing process and profitablity). Their product is viewed as high quality not only in the US, not only in North America, but worldwide. Could that be part of the answer?

So tell me, how is it that one American manufacturing giant, using union labor, can be at record profits for at least the past five years while the domestic auto industry is at the opposite end of the spectrum. Before anyone replies, I'll conceed gas prices and the domestic automakers love of high profit SUV's as to their losses for the past 18 months. So lets use 2006 as a reasonable reference point. My assertion, management, labor and product. Deere management made hard choices years ago regarding labor. I remember at the time management was chided as heartless to the needs of the working man, et al. But their men and women are still working, still making by any standards a very good living. Their product is viewed worldwide as one of the highest quality within the industry. What am I missing?

Batter up.

Deere is union and in fact, UAW. They got an earlier and better start than the Big Three on restructuring. Plus Deere's domestically manufactured competition is, if I'm not mistaken, limited to a few other American manufacturers with UAW labor. It's not like there's been ten to twelve new, foreign owned transplant assembly plants, with hundreds of millions of dollars in tax payers money as incentives, show up to compete with Deere. Caterpillar, Case-New Holland plants in the USA are UAW represented. Caterpillar and the UAW's relationship is best described as rocky.

[Bunky]

Originally Posted by billium

Additionally, each member immediately buys common stock in their employer equal to one half of their current retirement benefits (what's known as "skin in the game" where I come from). In return for your vote of confidence and cash investments, my tax dollars go to "loan" your industry money (the biggest sub-prime loans that I can imagine).

This may sound like a good idea but the stock price often has little to do with reality. The stock price is controlled by all sorts of things...company performance is not necessarily always one of them.

The market seems to bounce around like a drunk person ..you see the games when on a decent up day for some strange reasons stocks tank at 3PM (why, computerized trading try to play games). It is not like at 3PM something really happened.

For example, I feel sorry for the Wachovia stockholders including employees that lost so much because some people sold the company stock short forcing a panic sell causing a dramatic decrease in value and then let Wells Fargo get it on the cheap. Wachovia was not in that bad of shape but games in the stock market.

You would think people would want to buy stocks that show signs of stability next year but you do not. It is herd mentality and wall street gamesmanship (derivatives, etc) where company performance has nothing to do with making money. As an example, at height of the bailout IBM announced great 3Q earninga and said it would meet the year end expectations....result --- stock if off $30 (about 20%). The republican social security plan for most is now down the toilet lured by quick profits.

To me, the stock market is like Vegas...but not regulated. The "house" is making money...

[Len_A]

Toyota likely to report loss in second half | Reuters

[billium]

Deere came at Cat with everything they had when Cat decided to get into the ag market. I believe Cat got out of the ag market a few years ago.

Deere competes in Europe where there are in fact many "regional" manufacturers who are given government subsidies.

Is the assumption that upon bankruptcy, domestic auto manufacturing will cease (other than foreign owned brands)? If so, I believe that assumption is wrong. I assume a competitive manufacturer will rise from the ashes, one that can compete head to head on quality and on price (no rebates required if you build a quality & stylish product and sell it at a competitive price). One that will make economic sense, with competitively compensated labor (including white collar), production capacity which reflects reasonable sales and inventory, dealerships NOT on every corner, etc.

On the stock price front (doesn't reflect actual value), anyone could have bought GM in it's entirety for around $2 billion at the market low. $2 billion? This at a time when GM had approximately $30 billion in the bank. What does that say about GM's outlook. What does it say when no other manufacturer, foreign or domestic, ponied up? Jeez, I'm guessing the UAW could have come up with that amount and run the company as they see fit.

If the stock valuation is currently being manipulated, does anyone here think GM's value is being artificially inflated? If so, short it. If not (my position), then what a perfect time to buy big chunks at artificially low prices. If proven correctly, what a windfall for the investor. This assumes that the company is viable in the long term.

[Len_A]

Originally Posted by billium

Deere came at Cat with everything they had when Cat decided to get into the ag market. I believe Cat got out of the ag market a few years ago.

Deere competes in Europe where there are in fact many "regional" manufacturers who are given government subsidies.

Is the assumption that upon bankruptcy, domestic auto manufacturing will cease (other than foreign owned brands)? If so, I believe that assumption is wrong. I assume a competitive manufacturer will rise from the ashes, one that can compete head to head on quality and on price (no rebates required if you build a quality & stylish product and sell it at a competitive price). One that will make economic sense, with competitively compensated labor (including white collar), production capacity which reflects reasonable sales and inventory, dealerships NOT on every corner, etc.

On the stock price front (doesn't reflect actual value), anyone could have bought GM in it's entirety for around $2 billion at the market low. $2 billion? This at a time when GM had approximately $30 billion in the bank. What does that say about GM's outlook. What does it say when no other manufacturer, foreign or domestic, ponied up? Jeez, I'm guessing the UAW could have come up with that amount and run the company as they see fit.

If the stock valuation is currently being manipulated, does anyone here think GM's value is being artificially inflated? If so, short it. If not (my position), then what a perfect time to buy big chunks at artificially low prices. If proven correctly, what a windfall for the investor. This assumes that the company is viable in the long term.

The Center for Automotive Research did a study that showed that 80% of buyers would not buy from a manufacturer in bankruptcy. CNW Research in Oregon did a separate study that showed that all the bankruptcy talk was already chasing away about one third of the current buyers. The thought is that would cut cash flow so much, that an automaker could not survive. In this current economy, there's virtually no chance that anyone is going to come up with the financing to acquire GM in whole, and for GM, it's also nearly impossible to come up with the financing to survive during bankruptcy, even if sales kept up at a level to keep the company alive.

Because of the state franchise laws in all fifty states, cutting the number of dealers is expensive and time consuming. Even bankruptcy isn't an easy solution, because they have to be dealt with individually. Production capacity has been being brought into line with sales for several years now, but current economic circumstances is cutting demand so low, that no one is making money and the entire world wide auto industry is being threatened. The Europeans are are coming up with money to backup or bailout their auto industry, and japan is pumping billions into their economy to try stimulate demand. So far, we are the only country that has not, as of present, done anything yet, and that may be one more factor driving the Bush administration to come up with a solution.

[smoknfastlegend]

Heres my question i pose about this loan/bailout. If people slowed down their purchasing of domestic cars in recent years, which lead to this situation, whats to make them believe domestic car demand is going to miraculously return? If they are burning through cash this quickly and need say 7 billion now, it will only last them till say march if that. In that time i doubt demand for an american car is going to increase so much that they will be able to survive until 2010. They will only need more money from us. And TARP money shoudl not be used either, that would make the second lie to the US citizens by Paulson on taking our money for bail outs. In all honesty, the failing of the US autos is inevitable and all this loan is going to do is at least promise the employees money for christmas, but after that nothing.

[Scottwax]

Until banks loosen up their current lending policies, car sales are going to suffer.

[Len_A]

Originally Posted by smoknfastlegend

Heres my question i pose about this loan/bailout. If people slowed down their purchasing of domestic cars in recent years, which lead to this situation, whats to make them believe domestic car demand is going to miraculously return? If they are burning through cash this quickly and need say 7 billion now, it will only last them till say march if that. In that time i doubt demand for an american car is going to increase so much that they will be able to survive until 2010. They will only need more money from us. And TARP money shoudl not be used either, that would make the second lie to the US citizens by Paulson on taking our money for bail outs. In all honesty, the failing of the US autos is inevitable and all this loan is going to do is at least promise the employees money for christmas, but after that nothing.

Who sells half of all cars & light trucks in the USA? The Detroit automakers. Who builds about 70% of the cars & light trucks in the USA? The Detroit automakers. Who accounts for more than 70% of the auto parts business, and supports the auto parts industry that the transplants depend on? The Detroit automakers.

No Detroit automakers? Even the the transplants execs have said that their production would be threatened. Auto & light truck production is about 20% of all manufacturing, and manufacturing is supposed to be about half the economy. Detroit's share means they are 14% of all manufacturing and 7% of all economic activity. They have to survive, and until credit was tightened as much as it has, they were making progress toward making it to 2010. Then the financial markets imploded.

Right now, it isn't just the domestics sales that have plummeted. The transplants have seen November sales drop by the same large percentages (in fact, Toyota and Nissan's sales drops was as bad as GM & Chryslers, and Honda's was worse than Ford's sales drop - Ford actually gained market share last month), and now Toyota world wide is expected to have lost money in the second half of the year.

Originally Posted by Scottwax

Until banks loosen up their current lending policies, car sales are going to suffer.

Agreed. 100%

[RedlineIRL]

Originally Posted by jfelbab

The $14 an hour figure does not take effect for new hires until 2011. You and many others parrot that line like it's a current fact. Yet this is not the issue as few if any new employees are being hired or likely will be in the near term.

Oh really? Where do you get that misinformation from? $14 an hour IS the current new hiring wage for UAW workers.

Originally Posted by jfelbab

The big issue is the cost of labor. That is not to say the salary is much different but that the benefits are much higher. When you look at the cost of labor as the defining number you see that the big three labor costs $70/hour while the transplants labor cost is $48/ hour. Looking at the difference this labor cost makes accounts for the fact that in 2007 the big three lost on average $2,000 for every car sold while the transplants made $1,500 on every car sold.

More misconceptions.

Labor costs are about 10 percent of the costs of producing a vehicle. The other 90 percent includes research and development, parts, advertising, marketing and management overhead.

Originally Posted by jfelbab

The idea of asking for a bailout and not be willing to make the sacrifices needed to bring profitability to the company is ludicrous. Simply put it is absurd. Try going to a bank and dictating that they give you a loan and show them that you will have no possible means to repay it, you have no plan to become profitable and see what their decision will be. If the big three had any demonstrable means of paying back a loan they would not need to ask the government for the money they would be able to get it from the private sector.

They ARE willing to make sacrifices. What do you think they did when they construtced their plan that outlined what they are going to do? They are planning on eliminating brands, the CEOs were willing to take a $1 salary with no bonuses for them and reducing top company manages pay, and the UAW has said that they were going to do away with the job banks and other sacrifices if necessary. It's redicilous to say that they were are not willing to make sacrifices.

Originally Posted by jfelbab

No one wants to see the industry fail. The only way they can become viable is to reduce their cost of labor, plain and simple. to suckle on so nothing will get fixed with the company. Plan on repeated bailouts for the big three. Other companies and even state governments are alreadyThe UAW wants to start sucking on the teat of the us government. Looks like Bushey will give them that teat lining up for some of the governments "free" money. Hope you have deep pockets as you will be giving them this "free" money.

Hope you have deep pockets and guaranteed secure job if they don't get their "free" money. It's not going to be "free" money, it's going to be a loan as propsed before.

Originally Posted by jfelbab

I believe that loaning money to these companies will only delay their day of reckoning. The only difference is that I wall be out a lot of money then too. This bail-out will just delay the day that I will be asked to pay for extended unemployment benefits only at that later date I , my children and my grand children, will no longer have any money either.

How are you going to be out of money over this? If you are a working American citizen you will ALWAYS pay taxes guaranteed. Why does everyone think that there is going to be a huge tax hike over this? Are you paying more in taxes right now over government money that has been given out in the past? Have you been paying more over the Iraq war?