COMPROMISE REACHED FOR BIG 3

[Mr. Wyndham]

Originally Posted by carfansince73

From what I understand, that is for new workers only, not the existing ones which make $27/hr plus full benefits. Toyota is half that. The UAW need to realize that if they want their members to have a job, they will have to renegotiate their contracts. A job pay that pays less is better than no job at all.

So...you'd have them all take 50% pay cuts, too?
I wonder...how might that effect the local economies where those people work? And how might you or I feel if we've suddenly been told to wipe away half our income..."or else". This "better to have a job at all..." reasoning astounds me at how callous people can be when they're talking about somebody else. Doing what you propose is simply not possible for a whole slew of reasons.

Secondly, many of the older employees close to retirement were already bought out and some replaced with the new guys at the lower wage.

Originally Posted by TomServo

It's my understanding that "these" consessions were based on selling 16 MILLION units per year. The industry has constricted DOWN to less than 11 MILLIONyear it may fall even lower. More consessions and LAYOFF will be needed and the UAW may have drawn a line in the sand.

Correct me if I'm wrong but the BIG 3 aren't out of the woods yet with legacy costs.

You're absolutely right. There are more changes that can, and ultimately should be made. But none of them can happen overnight. And ignoring the recent changes because they aren't "good enough" undermines the whole process, imo.

As for the units/pay...I have no idea. I can't imagine that hourly pay would change depending on how many units they make. But layoffs, and plant closings, etc may need to happen. Many have already been bought into early retirement, and many plants have been closed. (more examples of recent changes that the likes of Mitt Romney are ignoring)

[Design1stCode2nd]

The next couple of weeks are going to be crucial. If there is no bridge loan (really just a postponement at this point) then you may see suppliers asking for COD (wouldn’t you?) and if that happens GM is done they don’t have the money.

[rgrizzard]

Originally Posted by Dragoneye

It's already been addressed. The cost differences in terms of operation and worker pay are all but gone thanks to new contracts and restructuring. Their viability plans/reports they submit to congress in the coming week(s) will show that.

Thats not entirely correct. The new contracts and restructuring don't take place until 2010, and 25 billion won't get them there.

If they file Chapter 11 they can still operate as a business and a judge can get rid of their unions and pensions alltogether... Thats what they really need.

[rgrizzard]

Originally Posted by Skyman 08

I don't care how much money you give the U.S. automakers or any other U.S. company, until the american consumer gets his head out of his butt and realizes that he can't keep buying foreign products while asking for more money and benefits from the american company he works for we are all doomed!.

Sorry! but I don't think that will happen anytime soon. Look at Walmart, when the economy is down people flock to Walmart for cheap deals, and then wonder where their American manufacturing job went. Walmart wrote the book on sending manufacturing to China. But back to GM, more than half of their open plants are out of the country(I believe it is 50 out of 98), so even buying from them does not keep the money over here.

[Mr. Wyndham]

Originally Posted by rgrizzard

Thats not entirely correct. The new contracts and restructuring don't take place until 2010, and 25 billion won't get them there.

Yes...and no. White-collar workers 65 and older have no company-provided healthcare coverage effective...a month ago, afaik. A few plants are due to close in 2009, with more following in 2010. They've sold off some assets, thus lowering operational costs. They've bought off many employees both white and blue collar into early retirement over the past few months. They've restructured managment to make it more streamlined in the different brands; condensing 8 different brands into 4 managerial structures. And new hourly employees are making ~15 bucks an hour plus reduced benefits...afaik, there's no delay on that. Also, new vehicles were part of the restructuring, and those are out right now with more to follow.

What's delayed is the VEBA plan. Which shifts a massive healthcare burden off of GM. They've got nearly a million retirees, old retirees, they're supporting right now. Taking those costs out of the equation is a huge deal; and that's what the 2010 date is about.

I don't know if the 25 billion will sustain them. But if it won't; then they'd be asking for more...so I'm inclined to believe it will under current, sucky, conditions.

Originally Posted by rgrizzard

If they file Chapter 11 they can still operate as a business and a judge can get rid of their unions and pensions alltogether... Thats what they really need.

But that is under assumed ideal conditions, like four years ago...and that is what chapter 11 proponents fail to realize: We are far from perfect conditions right now. Entering into Chapter 11 protection will all but ensure they get forwarded to Chapter 7 liquidation for a varitey of reasons. Bye-bye Auto Industry.

[Mr. Wyndham]

Originally Posted by rgrizzard

But back to GM, more than half of their open plants are out of the country(I believe it is 50 out of 98), so even buying from them does not keep the money over here.

Is that taking into account gobal operations? Just curious.

And buying from them does keep much more money here than if one bought a Toyota (even if it was made in the US).

[rgrizzard]

Originally Posted by Dragoneye

Is that taking into account gobal operations? Just curious.

And buying from them does keep much more money here than if one bought a Toyota (even if it was made in the US).

The money goes 4 main places(excluding stock holders which could be anyone); execs, engineering, manufacturing and parts and service/warranty. The biggest benefit that a local economy sees are the last 2. The larger the portion of vehicle that gets made here the better off our economy is.

I am not saying Toyota is better in fact I am sure they are not. But GM cuts their own costs by going overseas and then wonders why the consumer does so as well???

If we do the "bailout" I think we should balance it by tariffs according to the ratio of built here vs. overseas. Just my .02. Otherwise we never get out of this hole. Again in my opinion we have become largely a nation of office dwellers and lost a lot of our manufacturing to other countries. We are not the manufacturing hounds that got us to greatness and I believe that we lost manufacturing purely based on labor costs and taxes. We've cut our own throats...

[carfansince73]

Originally Posted by Dragoneye

So...you'd have them all take 50% pay cuts, too?
I wonder...how might that effect the local economies where those people work?

No I wouldn't, but as everyone can see the market conditions won't sustain their workers making so much. It's obvious car companies can make good cars with workers making a lot less. Just look at the import companies with NO UNIONS.

As for the effect to local economies, imagine if they don't budge on what their UAW workers make and the companies go out of business completely. I think we can all agree that would be worse than having them make less per hour while staying in business.

Yeah, I can say that would suck to have my salary cut, but having a lower paying job for the time being until I could find another is better than no job at all. I've been laid off before so I know what it's like to lose a job unexpectedly, and that's certainly worse than taking less/hr. Uemployment doesn't pay crap compared to what they might end up making.

Originally Posted by Dragoneye

Secondly, many of the older employees close to retirement were already bought out and some replaced with the new guys at the lower wage.

That was a good move on their part. I don't know if that $27/hr figure you see on the news includes those new people making less, but if it does, than those employees who didn't take a buyout must be making a LOT more than $27/hr.

[Angrybird 12]

Originally Posted by rgrizzard

I am not saying Toyota is better in fact I am sure they are not. But GM cuts their own costs by going overseas and then wonders why the consumer does so as well???

I will just make a comment on this one statement

The reason GM or any other US manufacturers have gone overseas is because the consumers went there FIRST....and the only way to compete was to go to the same places the foreign manufacturers make stuff... in other words the american consumer is also reponsible for driving our businesses overseas. I have been saying it for 0ver 30 years, and for 30 years nobody was listening... Gee, I hate repeating myself...

[NAHURRY]

[rgrizzard]

Originally Posted by Skyman 08

I will just make a comment on this one statement

The reason GM or any other US manufacturers have gone overseas is because the consumers went there FIRST....and the only way to compete was to go to the same places the foreign manufacturers make stuff... in other words the american consumer is also reponsible for driving our businesses overseas. I have been saying it for 0ver 30 years, and for 30 years nobody was listening... Gee, I hate repeating myself...

Consumers did not go there first(I don't believe anywhere in our history has American consumers demanded cheap foreign products). American retailers(see Walmart and the likes) saw a profit line by bringing in cheap foreign goods and putting it up for sale over here. Companies and politicians should have put a stop to this from the begining. Free and fair trade is great and all but hardly competitive when a chinese worker makes 1/10 of what an American worker makes. Don't blame the consumer most of them don't understand(ignorance is bliss), this lies in the politicians and corporate Americas pocket!

[Mr. Wyndham]

Originally Posted by rgrizzard

Don't blame the consumer

Why not? For better or worse, everything starts with the consumer; it's the foundation of our market. No company shoves products down your throat, or hold a gun to your head. It's totally your choice what to buy.

On a positive note; consumers demand new, 'better' things. This drives advancement and innovation.

However:
The fact that he/she is ignorant about product origins and the "big picture" is their fault.
The fact that they demand cheap products is their fault.
And the quest by companies for these consumer-demanded cheap products led them overseas to ultra-cheap labor.

But a company cannot say any of that, or else many of them would...because to the consumer, it's everybody else's fault.

[Angrybird 12]

Originally Posted by rgrizzard

Consumers did not go there first(I don't believe anywhere in our history has American consumers demanded cheap foreign products). American retailers(see Walmart and the likes) saw a profit line by bringing in cheap foreign goods and putting it up for sale over here. Companies and politicians should have put a stop to this from the begining. Free and fair trade is great and all but hardly competitive when a chinese worker makes 1/10 of what an American worker makes. Don't blame the consumer most of them don't understand(ignorance is bliss), this lies in the politicians and corporate Americas pocket!

That right there is the problem, people don't understand that each purchase has an impact. no matter how small that purchase is. and that is WHY they SHOULD BE BLAMED for what has happened.
I will explain this one more time...
think about this logically. if you buy a foreign made product, that costs the sale of one American made product. right? when this started there was nothing that was made overseas that you could not buy an american version of. The early Japanese products were basically JUNK, the big joke of the day was the throw away toys the Japanese made. but they were trying to copy American made toys.. for the same toy you could buy 4 japanese toy cars for the price of one american made one. so kids were going to tear them up anyway so who bought the cheap ones to save money?
The same went for the Japanese transistor radios of the early 60's. My dad bought a new Motorola transistor radio for 19 dollars, Our neighbor bought a Japanese brand that cost 10 dollars. the American brand had 10 transistors, the Japanese brand had 5 transistors, the American radio would bring in stations from 300 miles away. the Japanese radio was lucky to bring in a station from across the town... eventually the American company went out of business selling transistor radios, not because of an inferior product but cheap foreign competition. The American consumer demanded cheap foreign goods with their pocketbooks. Now the same is starting to happen with Chinese products, Korean products (Name your third world country), I bet you can remember will everything brought in from China was junk.. now look, most everything here electronically and toy wise is from china... soon it will be their cars... watch out I am warning you it is happening all over again...It's just moving from Japan.. even they are feeling it this time. Do you now see a pattern here?

You can try to blame the government and companies for running our jobs out of the country, but if you think about it, WE are the ones to blame. And we can change it the same way, it took 50 years to get here so it is going to take many years to get back.. remember the consumer has the strongest vote by knowing where his dollar is going.
The government and the companies just reacted to our demands with our buying habits, and if we change our buying habits we may be able to Save what we have, but it will be near impossible to get back those industries we have lost. We and our Government cannot control what workers make in other countries, the only thing we can do is show them we will support OUR workers and OUR country by buying from domestic manufacturers every chance we can.

Please just remember this one thing
Every time you buy a foreign made product that is also made in the USA you are contributing to the demise of that industry in the USA. eventually there will be no products made here if we keep doing what we have been doing...

[DGthe3]

One thing to remember, it took the Japanesse 40 years to bring good products to our market. It took the Koreans about 20. It should be even less for China