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Originally posted by 18psi2300:
Originally posted by bigMoneyRacing:
Two things are killing the big three IMNSHO. #1 Years and years of poor product. #2 Legacy costs. Just google GM and legacy cost, its astounding. In 2003, GM had 2.53 retired workers for every worker on the job. Over $1000 of *every* vehicle sale goes straight to legacy costs. Thank you union!
I don't know if you've ever worked in a factory, but people retire out of there battered and broken. If a worker puts in 25 or 30 years of work, I'd say a company owes them a decent way of living when they're done. Humans are not disposable objects that you use for profit and then throw away when they're no longer of value to you.
Very true. But when you're making more than $31.50/hr (the average wage for a UAW worker in 2002) you also share some responsibility for saving for your own retirement. You shouldn't have to rely on GM paying you a substantial portion of what you need in perpetuity. Part of that exhorbitant sum of money from the company is so that you'll have a "decent way of living when they're done."
When the original pension agreements were written up with the UAW decades ago people didn't live as long as they do know. Companies are facing the same thing that Social Security is today -- People are living longer and far more people are retiring than working. GM has almost 500,000 retirees to pay but only a little more than 150,000 employees that actually earn it money. It never expected that to happen. And renegotiating the contracts to withhold more pay for pension plans, extend the retirement age, or decrease pension payouts is not an option; the unions aren't willing to budge. And even if it did it would only affect the current generation of workers, not the ones that are already retired. It wouldn't solve the problem. Of course bankruptcy wouldn't either -- it would declare all pension contracts null and void, leaving the workers with absolutely nothing. If GM lasts more than a few more years without declaring Chapter 11 I'd be surprised.
Only a federal bail-out of retirement and health-care costs is going to save Ford and GM. The Japanese have a much younger US workforce in the US and aren't yet shouldering huge retirement costs. And in Japan people take more personal responsibility for their own retirement and health-care is largely government-subsidized. As such, the added costs to Japanese vehicles are very small. GM is almost $3,000 per vehicle just to pay health-care and retirement costs that Japanese companies largely do not pay. It's an unfair competetive advantage that will soon balloon to being an impossible hurdle for the Big Three to clear with GM going first.
2003 Mazda6s 3.0L MTX
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Originally posted by baco99:
Foreign companies are building plants here because our labor is cheaper than labor in Western Europe and Japan. and even with unions, it is much harder to fire employees in EU or Japan than it is here.
If you look though, most (or all?) of the factories set up by foreign companies are non-union and are set-up in right-to-work states that have much lower labor costs.
IMO, it is interesting how European's look at their own auto industry(ies). Same thing with the Japanese, moreso actually. Perhaps they are more nationalistic (if that is a word) about their industry.
"Bros before Hoes" <-- More men need this mentality.
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I heard on the radio this morning that gasoline prices are expected to jump 25 cents a gallons this month. I've heard $2.50 a gallon by this summer. With the American car makers having most of their production tied up in pickups and big SUV's, I imagine they'll be in trouble. Ford has been teetering on the edge of bankruptcy for awhile, and unless they start producing some winning cars, I wouldn't be surprised to see them bought out by a foreign automaker.
American automakers can't understand how to build a quality small car. The Japanese and the Koreans have figured out how to make great gas mileage and quality workmanship go hand in hand. Asian small cars have well appointed interiors, good build quality, and durable power trains.
The only reason I bought my Mystique was that I wanted a compact sized economy car, but yet with luxury features I had come to expect on my foreign cars. Try finding a 30 mpg American car nowadays with leather interior, power seat, tilt wheel, etc. The Focus and Cobalt just don't cut it with me, and I won't bother to consider them when new car time comes. My only choice will be between Honda and Toyota.
-Mark-
'99 Mystique LS, totally original (including the original water pump and the premium stereo)! Bought new in December 1998 for $21,000.
208,000 miles
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Originally posted by bigMoneyRacing:
One of the things that was brought up on Autoline Detroit a few weeks back was GM filing bankruptcy to get out from it's retiree costs. Let the Fed pick up the burden. They hypothesized that if GM did it then FoMoCo would have no choice but to follow suit. That'd be one way of pumping billions into the system.
If I was an american tax payer that would piss me off to no end. A company's failures should not be the burden of the taxpayer no matter what.
Maybe it's time for a degree of univ. health care, or at least the gov't covers you and you have to pay it back sort of deal. It might be time to discuss the issue again in the states, and saying its closer to communism isn't an excuse.
Besides, with all the incentives, 0% financing, rebates and offers they give, are they really being hampered by pension payments ?
It just seems like a substandard product being pushed and nobody's buying anymore.
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The best engineers in Japan and Germany build things well to help people. America's best engineers build things well to blow people up.
98.5 SVT FOR SALE
$5000
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Originally posted by SILFROSvT98:
The best engineers in Japan and Germany build things well to help people. America's best engineers build things well to blow people up.
Now that's just stupid.
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Originally posted by sigma:
Part of that exhorbitant sum of money from the company is so that you'll have a "decent way of living when they're done."
I agree with most of your post except this part. Workers get paid according to what their job is currently worth. No part of a current salary is legally intended to be earmarked by the recipient for retirement. Salary and retirement benefits are two separate negotiation areas.
E0 #36
'95 Ranger
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Originally posted by SILFROSvT98:
The best engineers in Japan and Germany build things well to help people. America's best engineers build things well to blow people up.
American car manufacturers have some of the best engineers in the world. What makes many American cars $hitboxes isn't poor engineering, its BEANCOUNTING. As I said about a month ago, engineers specify parts , good quailty ones, they specify robust designs. The BEANCOUNTERS [censored] and moan that those parts are too expensive, or that that assembly method takes 3/10 of a second more than this method. Since they make all the decisions, their stupid, short sided ways to save money win.
In the long run it is the BEANCOUNTER who screws over the American automaker, because the cheap parts fail. Everytime a car is recalled to correct the poor quality parts they spend more money to fix it than it would have cost to do it right the first time. Recalls piss off customers, and when every single Ford vehicle you have ever owned has been recalled multiple times, you don't buy Ford again.
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If you allowed the engineers to make finance decisions you would end up with a $30,000 Focus that no one would buy because it was priced too high.
The Finance Dept. has to keep costs in line with the exepcted Sales price of the car. Can't afford to make a car that continually loses money unless it pumps your CAFE ratings up.
Remember, the Big 3 would not have to cut corners on their cars if it wasnt for the Healthcare/Pension costs they are saddled with. Imagine them dumpin $1-3K into new car in better parts. Well then you would have a good competitor to the Honda/Toyotas of the world.
Pay should be based on skill level required to do the job, not what the Unions expect for their laborers. No employee deserves $31/hr to tighten a bolt or sweep a floor.
Money doesn't always bring happiness. People with ten million dollars are no happier than people with nine million dollars ~ Hobart Brown
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Originally posted by Beachboy:
American automakers can't understand how to build a quality small car. The Japanese and the Koreans have figured out how to make great gas mileage and quality workmanship go hand in hand. Asian small cars have well appointed interiors, good build quality, and durable power trains.
Beachboy,
Americans know how to build a quality anything. Ford buys hundreds of cars every year and tears them to pieces to see what makes them so good. They know how to make a Camry, Corolla, RAV4, etc. The choose to make their cars pieces of crap because they put the wrong people in charge.
The beancounters seem to have this antiquated idea that if someone buys a focus that is a piece of crap, that when the person buys their next car, they'll buy a Taurus. When they figure out that that car is junk, then they'll buy an Explorer. They think consumers will hop from car to car within 1 brand trying to find something "good"
The problem is that this isn't how the world works today. If someone buys a Focus, and it is a piece of crap, they won't buy a Taurus. They'll walk into their Toyota or Honda dealer and buy a Civic or Corolla. They'll drive the Civic or Corolla, they'll like it, and when it comes time to replace it, they'll replace it with a Toyota or Honda. Chances are they will never go back to the American car company again.
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