NINETY EIGHT REGENCY

GM pushes job changes

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GM pushes job changes

Plants where UAW balks may lose new work

Sharon Terlep / The Detroit News

ORION TOWNSHIP -- Contract talks between Detroit automakers and the United Auto Workers don't officially begin for months, but critical battles already are under way at General Motors Corp. plants around the country.

GM is pushing UAW locals at its factories to agree to money-saving work rule changes -- from reduced break time to more leeway to outsource jobs -- that mirror policies in plants run by foreign competitors, especially Toyota Motor Corp.

Ford Motor Co. was able to put such so-called competitive operating agreements in place with relative ease in more than three dozen of its U.S. plants, but GM is having a much tougher time convincing the UAW.

The stakes are high in these plant-by-plant battles because they could signal how agreeable the UAW will be to concessions to secure future work during national contract talks, which begin in earnest in July. GM wants to set a tone early that it won't tolerate money-wasting practices, and the union doesn't want to come across as quick to forgo hard-won safeguards in the workplace.

"This is the beginning of hardball," said David Cole, chairman of the Center for Automotive Research in Ann Arbor. "The basic message from GM is, 'We're not going to do products where they're not profitable.' "

GM has been working for years to put more flexible work rules in place at its plants. The company won't say how many factories have such agreements, but officials have acknowledged progress has been far slower than they'd like.

GM has made strides over the years in getting the union to implement money-saving practices, and the automaker already has some of the most efficient plants in the United States. But it's looking for broader, more comprehensive changes.

"We have to look for ways to close the competitive gaps," GM spokesman Dan Flores said.

GM loses an average $1,300 on each vehicle it makes in North America, while Toyota Motor Corp. makes about $2,100 on each car and truck built here, according to data from the Center for Automotive Research that is often cited by GM.

At issue are work rule changes both big and small that experts say could save hundreds of millions of dollars annually if implemented companywide.

GM, for example, could save money by paying overtime after a worker puts in more than 40 hours a week, rather than after eight hours in one day.

Less break time and rules that crack down on absenteeism also are likely on the automaker's wish list. Other key goals: fewer job classifications, which would improve flexibility by allowing workers to do more than one job, and the ability to outsource more nonproduction-related jobs.

Such rules are already in place in U.S. plants operated by foreign competitors, most of which are in the South and staffed by nonunion labor. "The competitor defines the game," Cole said, "and Toyota is the competitor."

Orion may be next target

The first signs of discord at GM came last month, when fighting over work rule changes temporarily stalled talks to bring new vehicles to plants in Kansas City, Kan., and Lordstown, Ohio.

Both plants produce small cars that have historically been money losers for GM. Top UAW officials interceded in the negotiations, ordering local union leaders to stop talking to GM.

The automaker responded by calling off work to prepare the plants for future vehicles, sending the message that without a competitive operating agreement, the plants could lose work.

Meanwhile, at the former Saturn plant in Spring Hill, Tenn., GM has secured a work rules deal after promising workers they would get to build a new Chevrolet crossover SUV. Workers in Spring Hill were desperate for a new product after GM canceled plans to build a minivan there.

GM's likely next target for a deal is its sprawling Orion Assembly plant in Oakland County, where the automaker has secured local tax breaks that often come with the promise of a new product investment.

GM makes the Pontiac G6 in Orion and is considering bringing production of the new Malibu sedan there if demand exceeds capacity at Kansas City, which will be the primary production site for the Malibu. It goes on sale later this year.

Union leaders wouldn't comment on negotiations, saying only that members haven't yet seen GM's proposal for a competitive operating agreement at Orion. But some workers say GM will face resistance to new work rules.

"Most of the people here have upwards of 20 years in," said Orion worker Terry Davis, who's worked at nine plants in his three decades with GM. "They're not going to give anything up."

National leaders fight deals

While Ford hammered out deals with local UAW leaders, GM is finding its efforts thwarted by national union officials.

The UAW wants to prevent local leaders from cutting deals that will secure new product at their factory at the expense of the larger work force, said Harley Shaiken, a labor expert at the University of California-Berkeley.

"Dangling product has much more consequence now -- there are more plants than products," Shaiken said."

"But the union has said, 'We're aware of this, but we're not going to be stampeded.' "

While GM has the obvious leverage of holding back work, the company also needs the cooperation of the UAW to mount a successful turnaround, Shaiken said.

Local UAW leaders say they're aware of the urgency surrounding GM's cost-cutting -- and how important it is for them to secure new products.

"The bottom line is that the membership is working to get a new product here," said Jim Graham, president of UAW Local 1112, which represents Lordstown workers. "We know how important new product is to the survival of our plant."

source:

http://www.detnews.com/apps/pbcs.dll/artic.../705250367/1148

Edited by NINETY EIGHT REGENCY
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It's time for GM to pull out all the stops and show the UAW who is running the show. I loved this quote: "Most of the people here have upwards of 20 years in," said Orion worker Terry Davis, who's worked at nine plants in his three decades with GM. "They're not going to give anything up."

GM should pull a Walmart and close the Orion plant if they can't get a competitive deal. The absolute gall of telling an employer "They're not going to give anything up." Well Mr. Terry Davis, I hope Toyota is hiring in your area. If not, I'm sure Walmart will help you out.

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It's time for GM to pull out all the stops and show the UAW who is running the show. I loved this quote: "Most of the people here have upwards of 20 years in," said Orion worker Terry Davis, who's worked at nine plants in his three decades with GM. "They're not going to give anything up."

GM should pull a Walmart and close the Orion plant if they can't get a competitive deal. The absolute gall of telling an employer "They're not going to give anything up." Well Mr. Terry Davis, I hope Toyota is hiring in your area. If not, I'm sure Walmart will help you out.

Yep.

I feel bad, because I see it happening at my dad's plant too.

But the have to break somewhere. If not, the UAW is going to get killed this time around. They need to salvage what they can.

L-town could be the first to see this-If GM has to, they will build Cobalts right next to the HHRs in Mexico if they have to.

Not to mention the money GM would save.

So it comes down to realizing what you have. And how you want to keep it that way.

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GM needs to go back to making the various GM plants compete against each other for new products! :yes:

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Give a little. Get a lot.

Help build GM marketshare back towards 25%, 30%, 40% and beyond and great things start happening.

Less overhead cost per vehicle.

Greater consumer acceptance to world-class vehicles leads to more sales.

And GM and the UAW avoid bankruptcy and total collapse.

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Hey - the UAW has nobody to blame but themselves. The solution for them is simple: get Toyota unionized. They've dropped the ball big time and will pay the price.

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Well, the locals could always split of like the CAW did if they don't think the UAW is working in their interests.

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Every story I read involving the UAW makes me despise them more and more.

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GM needs to go back to making the various GM plants compete against each other for new products! :yes:

No, that's a ridiculous and sleazy practice.

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GM needs to go back to making the various GM plants compete against each other for new products! :yes:

The UAW/CAW plants already have to compete with international plants. They should be mindful of this as they continue to demand their $50k salaries.
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The UAW/CAW plants already have to compete with international plants. They should be mindful of this as they continue to demand their $50k salaries.

On average, including benefits and compensation, union plant workers only make about $7 more and hour than workers in non-unionized Toyota plants.

Sans benefits and compensation, unionized autoworkers make a mere $2 more an hour than non-unionized workers.

Edited by AxelTheRed
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On average, including benefits and compensation, union plant workers only make about $7 more and hour than workers in non-unionized Toyota plants.

Sans benefits and compensation, unionized autoworkers make a mere $2 more an hour than non-unionized workers.

Precisely the reason the UAW has failed. The non-unionized plants are getting the benefit of the higher wages without the costs.

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Precisely the reason the UAW has failed. The non-unionized plants are getting the benefit of the higher wages without the costs.

The reason they failed is one of the reasons you bitch to high hell about them?

Didn't mean that to be rude, by the way.

Edited by AxelTheRed
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"GM loses an average $1,300 on each vehicle it makes in North America, while Toyota Motor Corp. makes about $2,100 on each car and truck built here, according to data from the Center for Automotive Research that is often cited by GM."

Well at least the yen wasn't blamed once.

In 2006 GMNA had ~111,000 hourly workers. Assuming they are paid for 8 hours per day and 261 days/year (365 - 104 for weekends), that is 213,768,000 work hours. They produced 4,652,000 vehicles. That is 49.82 hours/vehicle. Assuming the $7/hour difference is accurate, that is $320 more per vehicle in hourly worker costs for GM as compared to Toyota. (I'm not going to defend the job bank... but how much of that is the worker's fault as compared to management's?)

Compare that to 0% financing deals (easily several thousand dollars a vehicle), 1000 - 3500 cash back deals, employee pricing, "Total Value Promise", recall/warranty costs as a result of quality control, etc.

This is yet another red herring (yen herring?) to distract from GM's real problems. If GM made vehicles that people wanted, this wouldn't be an issue. I don't think the hourly workers are to blame for management incompetence. But I guess they get to pay the price.

As an interesting aside, at $30/share, Wagoner received total compensation of 23,373,000 in 2004 and 16,660,000 in 2005 (I don't have the 2006 numbers). Source:

http://www.companypay.com/executive/compen...orp.asp?yr=2005

That would work out to $5.02/vehicle and $3.58/vehicle respectively based on the 2006 production volume.

Edited by GXT
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Precisely the reason the UAW has failed. The non-unionized plants are getting the benefit of the higher wages without the costs.

There is no doubt that non-union workers get the to reap the benefits of the work of the union workers without paying the cost. Are you arguing that this proves that the union isn't needed? I hate to think what the hourly wage of an auto-worker would be without the union.

Hint: With the union they are at ~2.5% of Wagoner's 2004 compensation level. But I guess you get what you pay for. (?)

Edited by GXT
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There is no doubt that non-union workers get the to reap the benefits of the work of the union workers without paying the cost. Are you arguing that this proves that the union isn't needed? I hate to think what the hourly wage of an auto-worker would be without the union.

Hint: With the union they are at ~2.5% of Wagoner's 2004 compensation level. But I guess you get what you pay for. (?)

Yeah, you get what you pay for. Why should someone with little-to-no post-secondary education who does a job that requires little-to-no inherent skill or talent get paid more than $50,000? Hell, why do they even get paid 50 grande? You put too much value in their labor.

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"GM loses an average $1,300 on each vehicle it makes in North America, while Toyota Motor Corp. makes about $2,100 on each car and truck built here, according to data from the Center for Automotive Research that is often cited by GM."

Well at least the yen wasn't blamed once.

In 2006 GMNA had ~111,000 hourly workers. Assuming they are paid for 8 hours per day and 261 days/year (365 - 104 for weekends), that is 213,768,000 work hours. They produced 4,652,000 vehicles. That is 49.82 hours/vehicle. Assuming the $7/hour difference is accurate, that is $320 more per vehicle in hourly worker costs for GM as compared to Toyota. (I'm not going to defend the job bank... but how much of that is the worker's fault as compared to management's?)

Compare that to 0% financing deals (easily several thousand dollars a vehicle), 1000 - 3500 cash back deals, employee pricing, "Total Value Promise", recall/warranty costs as a result of quality control, etc.

This is yet another red herring (yen herring?) to distract from GM's real problems. If GM made vehicles that people wanted, this wouldn't be an issue. I don't think the hourly workers are to blame for management incompetence. But I guess they get to pay the price.

As an interesting aside, at $30/share, Wagoner received total compensation of 23,373,000 in 2004 and 16,660,000 in 2005 (I don't have the 2006 numbers). Source:

http://www.companypay.com/executive/compen...orp.asp?yr=2005

That would work out to $5.02/vehicle and $3.58/vehicle respectively based on the 2006 production volume.

If you're curious as to why the CEO/Chairman of a company should receive compensation, all you need to know is that if a union worker messes up on the job the company doesn't go under. If the CEO screws up, it does. So when the company is doing well, it only makes sense that the person RUNNING the company be properly rewarded.

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Yeah, you get what you pay for. Why should someone with little-to-no post-secondary education who does a job that requires little-to-no inherent skill or talent get paid more than $50,000? Hell, why do they even get paid 50 grande? You put too much value in their labor.

My father is a milwright. He has a bachelor's degree.

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My father is a milwright. He has a bachelor's degree.

Does he NEED his degree to do his job?

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Hey - the UAW has nobody to blame but themselves. The solution for them is simple: get Toyota unionized. They've dropped the ball big time and will pay the price.

unionizing toyota tomorrow won't magically burden them with two to three 55+ year old retirees per active worker that more often require high-cost medical procedures and medication. therefore, unionizing toyota won't make a huge dent in their profit margin nor level the playing field.

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Yeah, you get what you pay for. Why should someone with little-to-no post-secondary education who does a job that requires little-to-no inherent skill or talent get paid more than $50,000? Hell, why do they even get paid 50 grande? You put too much value in their labor.

education is important and should be rewarded in the workplace. but, education level is not the sole reason for employee compensation. education level isn't even an indication of actual intelligence. why do you think that those who were unable, for whatever reason, to get higher education deserve to be limited to the low or lower-middle class? why do those only with degrees deserve to live comfortably?

perhaps you put too little value in their labor because you don't have an accurate idea of what that labor is actually. after all, an accountant basically knows some rules, sits down and uses a calculator, right? a teacher simply stands in front of childeren and dictates a pre-determined curriculum. you can belittle nearly any profession or job if you aren't willing to understand what is truly involved.

i'm not smart enough to know what everyone is worth or what they should be paid. i'm just suggesting that maybe you aren't either.

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I'm not labor expert by any means, but labor can be valued by many factors. For instance, crab fisherman in the bering strait don't need any previous education or training, but they have the most dangerous job on the planet. Hence why they make 40-60 grande for a couple months work.

How much education/training has the person had to pay for themselves to qualify for the job you're giving them? How much does the employer have to pay out of pocket to train someone on the job? How easy is it to find someone to replace them? How physically stressful is the job? All these factors and more determine how much someone is paid.

In the example of a line worker at a GM factory, they require little-to-no previous education/training to qualify for the job, so they've paid nothing out of pocket. GM has to train them for a few weeks before they can adequately perform the job tasks. I'm not saying their job isn't physically stressful, but its not that hard to guide a body panel or fasten a bolt or tack weld something over and over and over.

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i'm pretty sick of this whole labor topic. it's been beat to death. labor, benefits, retirement obligations.

it will either be the downfall of american auto or not. at least they need to try to make it work.

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education is important and should be rewarded in the workplace. but, education level is not the sole reason for employee compensation. education level isn't even an indication of actual intelligence. why do you think that those who were unable, for whatever reason, to get higher education deserve to be limited to the low or lower-middle class? why do those only with degrees deserve to live comfortably?

perhaps you put too little value in their labor because you don't have an accurate idea of what that labor is actually. after all, an accountant basically knows some rules, sits down and uses a calculator, right? a teacher simply stands in front of childeren and dictates a pre-determined curriculum. you can belittle nearly any profession or job if you aren't willing to understand what is truly involved.

i'm not smart enough to know what everyone is worth or what they should be paid. i'm just suggesting that maybe you aren't either.

Actually, no one is smart enough - thus the reason labor value is left up to the "market" in most industries.... the "market" meaning the collective intellegence of the overall population. This is one of the reasons I fume about the illegal immigrant issue in the US. I hear news stories about farm owners complaining they can't get anyone to take the jobs immigrants are willing to take. This is just total bull$h! made for the media. What they REALLY mean is "they can't get anyone to take the job AT THE WAGES THEY'RE WILLING TO PAY." If you pay enough, someone will always take the job. The general population rarely understands this so when they hear complaints about lack of workers they're inclined to open the floodgates moreso than they already are. It's time to wake up.

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