UAW Killing Big 3?

[Hylton]

Originally Posted by Scott@Bjorn3D

I have been doing alot of reading on this and it looks like the unions are what are killing the big 3. Being down here in Alabama we have a few car plants and they make around 30.00 an hour for a worker. Most of the non union auto plants in the USA are paying 30-40 an hour. Seems pretty good to me.

But the UAW is charging 75.00 an hour to the big 3. Can anyone see the problem here? I would think people would rather make 40.00 an hour and know they will have a job and their company will survive than making 75.00 an hour and lots of layoffs and really not much job security.

And if the big 3 do not file bankruptcy they can't get out of these contracts. I would say file now and come out a leaner meaner company that can make it. Bailouts are not going to make the companys survive since they are still going to have to pay high union wages.

I do not want this to be a pissing match, but what do you guys and gals think on this? I want my Camaro but at the rate it is going GM may not be around to build it.

Are you kidding me? Do you not realize the impact to the economy if GM files Chapter 11? Let me ask you a few questions -

Do you think the companies (a few of them) that make frames for GM's pick-up trucks and SUV's are going to continue to supply those parts when there is no gaurantee they will be paid?

Do you think the average American who is worried about his home and family is going to buy a new car from a company that is bankrupt which means they can legally refuse to pay for any warranty work? Truth is they would go somewhere else and then how many GM plants would still be building cars?

I wish I knew how many direct suppliers GM had to make you understand that a bankrupt GM means many bankrupt companies. Some of these companies can only survive if GM survives. Others, like Magna and American Axle for example, would face such a huge loss in business that it may effect the ability for those companies to supply Ford and Chrysler even though it's only GM going under.

Yes the union should be willing to make concessions without GM having to go under because surely they must see how many jobs are in jeopardy. They should also understand that Chapter 11 means a death sentence to their jobs and their wages.

Speaking of jobs, it is estimated that the ripple effect of GM going Chapter 11 is 3 million lost jobs in the United States. We all have to be very careful in what we wish for......some serious shit is about to be launched on all of us if GM goes Chapter 11.

[Georgie]

why would he be kidding? the domestic automakers have inflated costs because of the UAW; if filing for bankruptcy is the only way to break the contracts and lower labor costs that are unrealistically high, so be it. there is no kidding about it; i don't think the union is going to give up much knowing the government will grant GM a bailout in the form of a generous loan. they must be reigned in, otherwise we will be where we are at once again down the road

[The_Blur]

Originally Posted by PsyDoc

Potato...Patatah. "Loan" just sounds better than "Bailout" plain and simple. There is nothing stated in the definition of "bailout" that implies it's money that never has to be paid back. In my opinion, the term bailout is more applicable because the Big 3 cannot secure loan anywhere else...it's government to the rescue or bust.

The real issue is whether an infusion of capital will save them and whether another $25 billion is enough or if it's just the foot-in-the-door technique where they keep asking for "a little" multiple times rather than one big chunk at once where most people would likely balk. Look at AIG..."We need $85 billion (Sept. 16th)...yeah...that will set things right. No wait, that's just not enough...now we need another $37.8 billion (Oct. 8th)...yeah, that will do it for sure. Wait...we still need more money...how about $20.9 billion (Oct. 31) for now. Crap, sorry...if we could just get a little more...perhaps $40 billion (Nov. 11th...looks like)." If they had stated up front that they needed well over $150 billion, then they might not have gotten the money. But, once they got their foot-in-the-door and the government committed to "saving them," then it is easy to keep getting more money. Why? Because if AIG failed, the government would appear to have wasted all that money. The government is basically honoring sunk costs (Dawes, 2001); they are in too deep to back out now.

What if each year, as individuals, we had to allocate what percent of our taxes would go to which programs. For example, some people might allocate 40% military, 20% homeland security, 40% infrastructure, or whatever while others would chose to support different programs. This might make the statement "government by the people" a bit more salient.

It is a loan. Fundamentally, this is not a bailout. Are you saying we shouldn't protect any of America's businesses. Why don't we just sell our country to China? Let's all become communists! This is a ridiculous way of thinking. We need to protect America's interests, and one of those interests is tax money. The Big 3 produce a ridiculous amount of taxes for the government. Without them, their suppliers won't exist to pay taxes, their employees won't have jobs to pay taxes, and they won't make cars that produce sales and property taxes. Another interest is national prestige. If America doesn't make cars, other countries don't see America on the same level they see Japan on the streets. It is a subtle form of national influence in other countries. It makes them dependent on us to some small extent. Yet another interest is keeping civilians employed. These people won't be losing their jobs due to poor performance. They will be losing their jobs due to corporate inadequacy. It may not be the fault of the companies that their markets suck, but it is certainly not the fault of some poor guy who makes car seats for a living that his company went bankrupt because they depend on the auto industry to stay afloat and buy his chairs. He did nothing wrong, and that dependency in the auto industry is a big part of why the government needs to get involved. An estimated 1.4 million Americans will lose their jobs if one of the Big 3 fails. After one company fails, the whole corporate food chain will collapse. A company that makes 50% of its income from Chrysler and the other 50% from Honda will go under because Chrysler collapsed. Suddenly, Honda will not have whatever that company provides. In effect, Honda will not be able to make cars. Now Honda has gone under, and all of Honda's suppliers, some of which also do business with GM, will disappear. Now, GM can't make cars, and GM goes under. Do you see how this works? It is an international market. Each company is somehow dependent on the next. The whole world operates on road-based transportation, and we can't allow every major automotive company to go under because a few wealthy politicians feel that a liberal free economy will fix itself. We must act to help them. We should bail them out, but instead we're giving them a loan. Someday, the US will get all of its money back, and all the people complaining about this so-called bailout can shut up. In the meantime, the US government has Americans to protect. :flag2:

Will this alone save the auto industry? We all know that it won't save them if they don't sell cars. We need the whole market to return to normalcy. That means that leases and loans need to be offered again. People need credit, and no industry will function without some form of credit. When credit returns, we can expect the auto industry to flourish again.

We are a representative democracy. There are way too many people to allocate the money on our own for government programs. I'm not going to argue any more on this point because most people wouldn't know what's what when looking at a federal budget. It is far more complicated than simple percents and political obligations.

[Hylton]

As Blur eluded to, any loan to the Big 3 is about protecting jobs more than about protecting businesses.

[Georgie]

that's also the problem. we maybe protecting jobs that put the automakers in this situation in the first place.

[Hylton]

If one of the Big 3 goes down, they all will go down. Chrysler CEO just came out and said this morning that if they get no government support, they may not survive.

[Hylton]

Originally Posted by Georgie

that's also the problem. we maybe protecting jobs that put the automakers in this situation in the first place.

No doubt unions jobs pay higher wages than average and they have added to the problem with the health care and pension costs, it pails in comparison to the fact that GM is selling half as many cars as they did this time last year.

[Georgie]

the point is, we need to address the core problems, not just the symptoms. there has to be conditions to the bailout and the current UAW demands cannot be apart of that. foreign automakers give their workers real good living wages and retirement plans. the UAW demands much more in wages and also full pensions. someone please correct me if i am wrong; watch GM and Ford's stock price go up once they achieve a market labor cost. it will happen sooner than we think

[Mr. Wyndham]

Originally Posted by Georgie

the point is, we need to address the core problems, not just the symptoms. there has to be conditions to the bailout and the current UAW demands cannot be apart of that.

I don't believe the money would go to the UAW...it's a loan to the company. It has nothing to do with the union workers.

Originally Posted by Georgie

foreign automakers give their workers real good living wages and retirement plans.

You absolutely sure about that? Last time I checked, the workers in a Toyota plant somewhere out west wanted to unionize because Toyota was shafting them all...

Originally Posted by Georgie

the UAW demands much more in wages and also full pensions. someone please correct me if i am wrong; watch GM and Ford's stock price go up once they achieve a market labor cost. it will happen sooner than we think

They have achieved a competitive contract with the union...everyone here seems to be forgetting the contract signed between the Big three and the UAW last year...(if memory serves) New hires have to start at HALF of what they used to, and GM's bought a real good chunk of the older people (highest paid due to seniority) out into retirement already. Then there was the PRIMARY issue...the REAL issue that caused the UAW to have such a negative effect on GM: HEALTHCARE. Low and behold, that issue will be resolved in 2010, when the UAW takes over the healthcare costs. I agree with you; wait until 2010; and watch GM's losses get less...bad.


Still...I don't understand how the Union is to blame for what's going on right now. Is this simply a scapegoat to take out fustration of GM's poor outlook on? The fact that they're selling nearly 40% LESS vehicles...and almost all of them are the profitable ones...simply DWARFS any issues they have with the union workers....:(

[Georgie]

if you have an article on the Toyota shafting i'd like to read it. i don't think getting paid 30 dollars an hour average with a 401K plan and health benefits is shafting, but maybe they were not doing that. i just want to know what you are refering to because i haven't read much about it.

[Mr. Wyndham]

Originally Posted by Georgie

if you have an article on the Toyota shafting i'd like to read it. i don't think getting paid 30 dollars an hour average with a 401K plan and health benefits is shafting, but maybe they were not doing that. i just want to know what you are refering to because i haven't read much about it.

I'll try and find it...

[Croathlete]

Here's an example

http://www.inthesetimes.com/article/..._toyota_prius/

[FenwickHockey65]

Oh believe me, toyota's done its share of unfair treatment to workers. The link above is just one example...the guy who managed the camry hybrid's US launch died from overwork as well.

[GTAHVIT]

Originally Posted by Dragoneye

I don't believe the money would go to the UAW...it's a loan to the company. It has nothing to do with the union workers.

The original intent of the 25 Bil LOAN. was to help fund R and D as it related to the CAFE requirements. I don't know if GM can use that money how ever they choose. Bottom line, it will obviously free up cash and it will help them pay other bills.


You absolutely sure about that? Last time I checked, the workers in a Toyota plant somewhere out west wanted to unionize because Toyota was shafting them all...

Don't underestimate the Unions thirst for power. I'll never say that Toyota is an ethical company, and what they can get away with in Japan won't fly here. But that is prime real estate for the Unions to move in on. If I were a business developer for the UAW, that would be my low hanging fruit.


They have achieved a competitive contract with the union...everyone here seems to be forgetting the contract signed between the Big three and the UAW last year...(if memory serves) New hires have to start at HALF of what they used to, and GM's bought a real good chunk of the older people (highest paid due to seniority) out into retirement already. Then there was the PRIMARY issue...the REAL issue that caused the UAW to have such a negative effect on GM: HEALTHCARE. Low and behold, that issue will be resolved in 2010, when the UAW takes over the healthcare costs. I agree with you; wait until 2010; and watch GM's losses get less...bad.


Still...I don't understand how the Union is to blame for what's going on right now. Is this simply a scapegoat to take out fustration of GM's poor outlook on? The fact that they're selling nearly 40% LESS vehicles...and almost all of them are the profitable ones...simply DWARFS any issues they have with the union workers....:(

GM's financial trouble began as a result of paying unions triple what their global competitors were paying factory workers. Yes, health care, pensions, are huge contributors to GM's overhead. But the UAW has held GM over a barrel for years. While the competition was streamlining GM was getting overcharged. The straw that broke the camels back was gas prices and the economy.

Now, I completely agree that the new deal with the union is "fair" But, I don't see the need for union any more. With Federal and State HR laws what they are today. Employees have all the protection they need. Unions for the most part are inefficient and top heavy. Based on my experience in working with them routinely.