JuneBug said:
Couple of thoughts- oil - we haven't built a new refinery in over 30 years, we have 50 "designer"blends of gas that keep production from running at peak effienency, we have plenty of oil and natural gas - but can't drill - all cause of the wacko enviro's and their lawyers/PR/ liberal lame stream media. Don't get me started on that whole global warming scam, there are so many scientist coming out AGAINST that now that it's even fading from the press.
Cars - the American car companies where doomed from the 50's, you can't pay crazy wages to guys with a high school education to screw in a couple of taillights and then give him 85% of his pay to read newspapers. No company can afford that. The parasites at the UAW finally drained the last drop, good job boys, now maybe you can come down south, make a third of your old pay and piss & moan how grand the old union was, till some redneck like me slaps your teeth down your throat and kicks your sorry butt 10 feet northward. I hate it! My teenage years were all about Z-28's and SS396 Chevelles - great cars and now - my kids think a Chevy is only a truck or vette. Good job everybody, thank you.
Hybrid cars- why bother when VW and MB have clean diesels that are simpler, great on gas, and last longer than gas engines (and we don't have any numbers on how long these fancy hybrid systems will last) all we need is more capacity at the refineries - see above- and you have cheap fuel.
OK, first of all, without wanting to get into a debate, the Detroit car makers pay structure is not that different from the transplants - $25 an hour plus benefits from the time an employee has gone past their probationary period, which , in about all cases now in North America, is three years on attaining full wages. I know you can find stuff on line that references $70 - that's, one, grossly outdated, even if it's from early last year - the contracts have been reopened, get this, twice already, and pay structures have changed downward. What hurt the Detroit car makers wasn't weekly pay - it was the work rules, the idiotic jobs banks (that's gone now), and the fact that all three car makers still have thousands of retirees on teh books from a time when they made all their own parts in house. Even if they spun those divisions off, Delphi in GM's case, and Visteon in Ford's case, they are still stuck with all the retirees, hourly and salaried alike, that retired BEFORE those division were spun off.
The other thing hurting the Detroit car makers is retiree costs. Health care comes off their books effective January 1, 2010. That's written in stone - the UAW VEBA (Voluntary Health Benefits Association) takes over hourly retiree health care costs, and that's that. Salaried retirees got their health care benefits cut down to a stipend last years, and that's done. In the case of new hires, no new salaried employee hired after January 1, 2000 has either a pension or retiree health care. They are 401K only. Any new hourly employee hired after November, 2007 has no pension, or retiree health care (no VEBA participation either). That's done.
Second, the press made a big deal about the transplants making, with benefits, $20 an hour less than the Detroit car makers. Too bad the newspaper web sites charge for an article older than a month, because there were several from early last December that had Toyota and Honda execs complaining that the congressman and senators making those claims had it wrong, and they shouldn't have been making those claims as if they were Gospel, because Toyota and Honda had several plants where the assembly line workers were making
more than their UAW counterparts, because of big profit sharing bonuses. Moreover, all the transplants have had their labor costs go
up, sharply, in the last three to five months, because they all laid off their lower paid contract and temp employees. Think about it. If the press kept quoting an hourly labor cost of $50 an hour, including benefits, and they laid off
all, every single one, of their $15 and hour plus lower benefit employees, what did that do to their
average labor cost?? Why do you think all the car makers, including the transplants, are losing billions of dollars right now? Not only that, but two months ago, the Wall Street Journal and Automotive News reported that Toyota's monthly cash burn was exceeding that of GM's.
No one is making money in the car business right now.
On the comment on new refineries and new drilling - Kuwait's oil minister said yesterday that production won't increase until oil gets back above $100 a barrel. The oil companies here
won't drill or expand refining capacity either until oil prices go back - up enough to choke off a recovery. Great. Most of the new drilling projects went on hold when oil prices dropped last September.
