evok

The Canary in the Mineshaft.

53 posts in this topic

http://www.autoextremist.com/page2.shtml#Rant

I do not agree with him much but this time he nails it.


by Peter M. DeLorenzo


The Canary in the Mineshaft.

Detroit. The news of Delphi's bankruptcy filing may be just another piece of business news to those who don't live around these parts, or for those who don't have a vested interest in the U.S. auto industry, but the sad fact of the matter is that this development is just the tip of the iceberg in a fundamental shift that not only threatens to decimate the U.S. auto industry, it's one that will ultimately affect this nation's economy - no matter where you live or what you do.

The Delphi bankruptcy is the latest major crack in the pressure cooker that the U.S. auto industry has become over the last two decades - only this one is definitely the tipping point into a dimension that industry insiders have been dreading. Lower cost competition from around the world has changed the auto manufacturing landscape completely - and Detroit has been operating under a model that has been obsolete for years. Strapped with a crushing wage and benefits structure negotiated in an environment fueled by an optimism that in retrospect had absolutely no right to exist, the American car companies and the United Auto Workers union are now facing a future that revolves around a harsh reality that comes down to this one simple but all-encompassing statement: change or die.
0

Share this post


Link to post
Share on other sites
Sad but True, The UAW needs to wake up and realize that the rest of us in the US have been paying a fair share for our benefits and do not have the nice promised pension, etc. Reality is no one is really promised that not my 401K or IRA. Why the gov feels the need to bail out the union funds AKA United Airlines and what now looks like Northwest and Delta after it let the companies under pay their obligation is beyond me other than special interest Greed. The Steel companies thought they would be around for ever and Bethleham Steel is Gone. Reality is if you do not change to changing conditions then you will die. The socialist system the UAW has operated under for so long is out of date. The Unions did good things in the early years, but the last 30-40 years they have really not done much for the people that pay them a chunk of their hard earned income. Each and every person already has the rights the unions preach they get for the workers promised to them. If you do not like the pay, benefits etc. and do not want to negociate a better package on your own then find another job or learn to live with it. UAW like so many of the unions always wants a socialist answer of give me everything and not give anything back. They fight the companies rather than work to build a better product, better company. Again the US Unions ignored chances over the last 25 years for sure to build stronger companies that would keep their workers jobs. At this point, we are going to see major changes in the US auto landscape. I for one will miss some things and enjoy the new changes. A Global economy will always have fast currents that move and require a company to move with it. The best thing FORD and GM can do is to move to get new models out that gain profits and then put those profits into paying down financial obligations. The Executive mgmt and stock holders will reap HUGH benefits if they just wait a while rather than wanting instant gratification. Get their obligations paid and then they will be a terror force for the asian and European companies to deal with. Sad also is that the European Unions have this headache coming to them also. Germany needs a major wake up call. Edited by dfelt
0

Share this post


Link to post
Share on other sites
I refuse to blame the unions for the entire debacle that is GM but they do have a significant part in it. GM became stagnant with their designs and in the thinking that they would be on top forever. By not reacting to customer designs wants then you cant compete in the market. Now with that said, the UAW needs to realize it would be infinitely cheaper to build everything in some low wage country and import it. They have to make concessions in order to keep GM, and thus their jobs, alive. I wish I could get some of the benefits they do. One way or another there will be resolution to this situation. By the way things are shaping up, that result will not be a good one.
0

Share this post


Link to post
Share on other sites
This guy has hit the nail on the head. If Delphi isn't viable hen GM isnt viable either - Delphi is just GM lite, making the same products with the same cost structure that ultimately go to the same end customers The only real difference is that GM sells to the general public, who will panic and stop buying the minute GM is put into chapter 11. Hence, as I said in another thread, I think Kerkorian will come in with a low ball takeover offer at the last minute and then take it on himself to bash down the UAW almost as much as chapter 11 would do.
0

Share this post


Link to post
Share on other sites
I don't understand why everyone is saying that it's not just the union, GM is to blame too. What about Ford? What about Dodge (before Daimler bailed their butts out)? Isn't it strange how the two biggest American automakers (GM and Ford) still sell MORE cars and trucks than Toyota in the U.S., yet they're both failing financially and Toyota is thriving. No one is saying that the union is completely to blame for this, but it is absolutely absurd to think that someone bolting on bumpers with an air wrench is being paid $90,000 to $100,000 a year. I guarantee that if you offered ANY UAW worker the option of riding out this market uncertainty in his current job at his current pay and benefits, or told him he could take a different job in any other non-automotive manufacturing plant with guaranteed job security, EVERY one would choose to keep his current job. They HAVE to know that the money they make and benefits they get are not a reflection of any other real world job. It's about time that these workers deal with the reality that the rest of us have had to for a long time, that things cost more and, just because of that, our employers don't automatically give us a raise. I'm not anti-autoworker. I understand the devastation it would cause if all of the autoworkers were unemployed. But the autoworkers also need to have a reality check and realize the devastation their current path could cause in the whole American automotive industry.
0

Share this post


Link to post
Share on other sites

I don't understand why everyone is saying that it's not just the union, GM is to blame too. What about Ford? What about Dodge (before Daimler bailed their butts out)? Isn't it strange how the two biggest American automakers (GM and Ford) still sell MORE cars and trucks than Toyota in the U.S., yet they're both failing financially and Toyota is thriving. No one is saying that the union is completely to blame for this, but it is absolutely absurd to think that someone bolting on bumpers with an air wrench is being paid $90,000 to $100,000 a year.

I guarantee that if you offered ANY UAW worker the option of riding out this market uncertainty in his current job at his current pay and benefits, or told him he could take a different job in any other non-automotive manufacturing plant with guaranteed job security, EVERY one would choose to keep his current job. They HAVE to know that the money they make and benefits they get are not a reflection of any other real world job. It's about time that these workers deal with the reality that the rest of us have had to for a long time, that things cost more and, just because of that, our employers don't automatically give us a raise.

I'm not anti-autoworker. I understand the devastation it would cause if all of the autoworkers were unemployed. But the autoworkers also need to have a reality check and realize the devastation their current path could cause in the whole American automotive industry.

[post="27657"]<{POST_SNAPBACK}>[/post]



Although GM has made some design flaws, many of those have to do with their cost structure. I'm sure GM doesn't want an Equinox & a Torrent, they want an Equinox & a high proformance Pontiac SUV (like a low cost Porsche Cheyane). They have to rebadge because of a high cost structure. Where does that high cost structure come from. Hmm.......................... the answer starts with the letter U.
0

Share this post


Link to post
Share on other sites
Pull your heads out of your ass's boys. The industry isnt going to survive your beloved "global economy". Like I said before if we gave GM our children for free labor it would'nt change a thing. Your all too narrow minded and drivin by anger about something that may or may not have come down the shaft at you. You want to act like pension funds were not made, you want to act like workers didnt save while they indeed did. It was a pension fund, GM did not maintain it. The workers tried hard to get GM to keep employment up, jobs open, factorys working, yet the pocket lining decision makers you all are proping up decided to pay them full pay and not keep the jobs in house. While at the same time our government opened the doors wide open to products from near slave labor countries. So now we are up to a firm $90,000- $100,000 per year for line workers, what are you going to be up to next week ? $120,000-$140,000 Do you think the economies of the areas these people live in are drivin by their wages ? Are property tax's, school tax's, real estate, rent costs reflected by the standard of living in the area ? So then what happens when you chop someones wage by over 50% which is what has been proposed ? No sweat right ? Then to top it all off you wanna act like if they will only suffer through, tax/morgage forclosures, reposessions, no retirement plan, I would suspect probably homeless because I know rent cant be made at the wages proposed, with all that sacrifice you wanna act like it can save America from your global plan. Now the impact of this global economy is just upon us, and you dont want to get down to the real issues and cause/effect at hand, so shut your mouths and deal with how ugly it really is. Hell, I wouldnt cave either if the only answers to a much larger problem that anyone could come up with was throwing me into poverty.
0

Share this post


Link to post
Share on other sites

Pull your heads out of your ass's boys. The industry isnt going to survive your beloved "global economy". Like I said before if we gave GM our children for free labor it would'nt change a thing. Your all too narrow minded and drivin by anger about something that may or may not have come down the shaft at you. You want to act like pension funds were not made, you want to act like workers didnt save while they indeed did. It was a pension fund, GM did not maintain it. The workers tried hard to get GM to keep employment up, jobs open, factorys working, yet the pocket lining decision makers you all are proping up decided to pay them full pay and not keep the jobs in house. While at the same time our government opened the doors wide open to products from near slave labor countries.

So now we are up to a firm $90,000- $100,000 per year for line workers, what are you going to be up to next week ? $120,000-$140,000

Do you think the economies of the areas these people live in are drivin by their wages ? Are property tax's, school tax's, real estate, rent costs reflected by the standard of living in the area ? So then what happens when you chop someones wage by over 50% which is what has been proposed ? No sweat right ?

Then to top it all off you wanna act like if they will only suffer through, tax/morgage forclosures, reposessions, no retirement plan, I would suspect probably homeless because I know rent cant be made at the wages proposed, with all that sacrifice you wanna act like it can save America from your global plan.

Now the impact of this global economy is just upon us, and you dont want to get down to the real issues and cause/effect at hand,  so shut your mouths and deal with how ugly it really is.

Hell, I wouldnt cave either if the only answers to a much larger problem that anyone could come up with was throwing me into poverty.

[post="27687"]<{POST_SNAPBACK}>[/post]



Welcome to world-wide competition. Live by the rules, or die by the rules! Your choice! I feel sorry for NO union worker.
0

Share this post


Link to post
Share on other sites
You couldnt survive outside of your little protection. Where are these "rules", passing out rule books now are you ? :lol: Better pull it out its cutting of the circulation to your brain.
0

Share this post


Link to post
Share on other sites
The wage/benefit cuts that will have to happen to make US manufacturing profitable again will be staggering. Even at that point, basic vehicle assembly like the Asian brands do in the South might still be possible. But, parts suppliers will never again be able to make it if they have plants here. But for all of us who are clamoring for the UAW to bend over should realize this: it will not be long (as in, decades) before nearly all industries/businesses will be forced to do the same thing. If/when you have children, make sure they go to Med School or Law School, open up landscaping businesses, or become government employees. Provided there will still be people able to pay for their services, they might be OK. I'm not saying the sky is falling. That said, the ship is already taking on water, and the ONLY thing that will stop it (in MY opinion) is if some major patriotic revival occurs in the US (in which people purchase goods and services based on conscience). And I don't see that happening: For example, I know alot of good people, who even have kids, and who refuse to purchase (or even test drive) a "domestic" nameplate auto even though they know what they are doing to their children's future. I mean they are educated, so they KNOW it, but they just don't care. As far as the problems GM is facing above and beyond those of the rest of American industry, the ONLY people to blame are the ones who (incompetently and maliciously) ran the company into the ground the past 40 years. And I'm not saying that because I am pro-union (because I'm not pro-union).
0

Share this post


Link to post
Share on other sites

Pull your heads out of your ass's boys. The industry isnt going to survive your beloved "global economy". Like I said before if we gave GM our children for free labor it would'nt change a thing. Your all too narrow minded and drivin by anger about something that may or may not have come down the shaft at you. You want to act like pension funds were not made, you want to act like workers didnt save while they indeed did. It was a pension fund, GM did not maintain it. The workers tried hard to get GM to keep employment up, jobs open, factorys working, yet the pocket lining decision makers you all are proping up decided to pay them full pay and not keep the jobs in house. While at the same time our government opened the doors wide open to products from near slave labor countries.

So now we are up to a firm $90,000- $100,000 per year for line workers, what are you going to be up to next week ? $120,000-$140,000

Do you think the economies of the areas these people live in are drivin by their wages ? Are property tax's, school tax's, real estate, rent costs reflected by the standard of living in the area ? So then what happens when you chop someones wage by over 50% which is what has been proposed ? No sweat right ?

Then to top it all off you wanna act like if they will only suffer through, tax/morgage forclosures, reposessions, no retirement plan, I would suspect probably homeless because I know rent cant be made at the wages proposed, with all that sacrifice you wanna act like it can save America from your global plan.

Now the impact of this global economy is just upon us, and you dont want to get down to the real issues and cause/effect at hand,  so shut your mouths and deal with how ugly it really is.

Hell, I wouldnt cave either if the only answers to a much larger problem that anyone could come up with was throwing me into poverty.

[post="27687"]<{POST_SNAPBACK}>[/post]


yes there are all those outside forces, but still, sooner or later, either the workers accept compensation cuts to keep their jobs or all the jobs go bye bye. The external factors will not be fixed anytime soon. It comes down to, do you want the job or not. Its a cute idea to stand up for a matter of principle, but the numbers laugh at principles and will make the decision. Fix what you can now that is under your control. property tax's, school tax's, real estate, rent costs are influenced by so many other things there is no possible way to recitify them to allow GM to continue to prop up an arbitrary (not market set) compensation level.

As for the global economy, there is no way to stop it, it can be tempered. But reality is we cannot sustain ourselves with only our own resources and knowledge. Isolationism would be our quick and nasty downfall on so many fronts. Edited by regfootball
0

Share this post


Link to post
Share on other sites

Hell, I wouldnt cave either if the only answers to a much larger problem that anyone could come up with was throwing me into poverty.


That's an excellent statement that pleads the UAWs case perfectly...

Times have changed, this is a NATIONAL issue and reality for America workers sucks. And it won't get any better any time soon, if ever.
0

Share this post


Link to post
Share on other sites
If the auto industry can't survive a global economy then it doesn't deserve to live.
0

Share this post


Link to post
Share on other sites

If the auto industry can't survive a global economy then it doesn't deserve to live.

[post="27709"]<{POST_SNAPBACK}>[/post]


but yet another suffering from lack of oxygen
0

Share this post


Link to post
Share on other sites

If the auto industry can't survive a global economy then it doesn't deserve to live.

[post="27709"]<{POST_SNAPBACK}>[/post]


You are EXACTLY right! The UAW does not understand that this is a world economy, and the rules are the rules of the world, not the USA alone. The world rules state "If you can't survive in the world with Japan, China, Germany, etc. making things better and/or cheaper, you die! Like stated before in this thread, there are too many people in this country that are not loyal to their contries' industry. I buy American wherever I can, but
I beleive that I'm in the minority. A patriotic duty to buy American is what can save GM in the current state they are in, since that won't happen, the UAW needs its benefits and wages cut drasticaly, or we will need to see "Made in Bejeing" on the GM vehicles we buy. It's the UAW's choice to work with GM, or DIE!!!!
0

Share this post


Link to post
Share on other sites

but yet another suffering from lack of oxygen

[post="27718"]<{POST_SNAPBACK}>[/post]


Because Heaven forbid I get the best products at the best price. :rolleyes: Read a book lately? Socialism is SO last century!
0

Share this post


Link to post
Share on other sites
How much are member dues to the UAW? How much money does it take to staff an organization that controls staff? If the UAW disappeared as an organization and line workers accepted benefits and pay bases just like the white colar workers this discussion would me moot. The better question is this: When will US citizens quit drawing lines and distinctions and start living together? Too many try to make EVERYTHING these days black and white... just like gay rights... abortion... free speech... "right" to privacy... Nothing in life is this way. If more understood that then you would create the situations like these. Fact is this, corporations and workers (also read GM and UAW) have all been guilty of distancing themselves from each other. If the workers were extremely understanding and exuctives cared more about quality of life than shareholder return (see Southwest Airlines), you would see companies that could function. Companies and workers create these messes when one is not rewarded or given concessions when things go well or go wrong. Here's to the end of name calling... SERIOUSLY!!! STOP!
0

Share this post


Link to post
Share on other sites

If the auto industry can't survive a global economy then it doesn't deserve to live.

[post="27709"]<{POST_SNAPBACK}>[/post]



Okay, so pretty much ALL American industry should die???

Because, obviously it isn't just the auto industry that's struggling. I hope everyone has fun when this happens (All our industry dies) being poor and working at a shi**y 'service' job making fat cat executives in 2nd world countries happy.

I don't know why Americans are so blinded by this "global economy, America must suffer, but it'll all work out" :bs:

America will suffer and it WILL NOT work out unless something is done.

I hope we do hit rock bottom just to teach the naive a lesson.
0

Share this post


Link to post
Share on other sites
The reality that the UAW better face sooner than later is that is it MUCH, MUCH cheaper for GM & Ford to manufacture vehicles in Canada, Australia, Mexico, China, etc, than it is in the US. It would have been unheard of 20 years ago for GM to make a vehicle outside of the US to sell within the US. Now, BECAUSE of the unions, they HAVE TO make their vehicles outside of the US to be anywhere near profitable. If the unions don't change their ways, they'll watch GM & Ford slowly move all of their new plants to countries where they don't have to deal with them. Do you really think that Toyota, Honda, or Hyundai would be opening the number of plants in the US if they had to deal with the UAW and pay the wages that those workers make? I'm sure that it wouldn't happen.
0

Share this post


Link to post
Share on other sites

Because Heaven forbid I get the best products at the best price.  :rolleyes:  Read a book lately?  Socialism is SO last century!

[post="27723"]<{POST_SNAPBACK}>[/post]


If GM goes under complete. The rest of the automobile companies out there won't be able to pick up the slack. There will be tons of people out of work around the globe.

All the GM suppliers
All the GM dealers
All the GM factories

Know how many workers that is? I don't, but I bet it's huge.
0

Share this post


Link to post
Share on other sites

Okay, so pretty much ALL American industry should die???

Because, obviously it isn't just the auto industry that's struggling. I hope everyone has fun when this happens (All our industry dies) being poor and working at a shi**y 'service' job making fat cat executives in 2nd world countries happy.

I don't know why Americans are so blinded by this "global economy, America must suffer, but it'll all work out" :bs:

America will suffer and it WILL NOT work out unless something is done.

I hope we do hit rock bottom just to teach the naive a lesson.

[post="27739"]<{POST_SNAPBACK}>[/post]


Because thats obviously the only course America will take, yes? :rolleyes:
0

Share this post


Link to post
Share on other sites
Razoredge is the only one in this discussion who doesn’t have tunnel vision. The unions are still a wage-stabilizing factor in the US economy. Some say, “Well look at the transplants. They are non-union and pay competitive wages. There is no doubt they would continue to pay competitive wages if the UAW wages where halved. The wages they paid would be competitive with those halved wages. Salaried workers wouldn’t fare much better. Why would GM pay a salaried first line supervisor $75-100K a year (including overtime) is those who report to them are only making $20K? They wouldn’t. And if GM isn’t paying high salaries, why would Ford, DCX, Honda, Nissan, Toyota, etc? Answer: they wouldn’t either. There would likely be a downward pressure on wages across the board, starting with OEMs, moving to Tier 1 suppliers, then Tier 2, and so forth. Soon, the accounting firm you just hired into pays you $10 an hour. Why not, where else are you going to go? It’s market economics just like you guys are arguing for. Unions are not socialist. They are operating on the labor market. Fortunately, they have a monopoly on a chunk of the market and can demand higher prices. If they weren’t there, there would be no positive wage pressure. First of all, Vetteman is way off, but he sure does know how to propagate a myth. A direct labor line worker doesn’t make $90-100K a year, even factoring in their solid benefit packages. (I worked in a GM assembly plant as a maintenance supervisor (non-union) for years and know what they make). A starting employee makes less than $15 an hour, while a soon to retire one maybe makes $28. That’s $30K to $56K a year. Add overtime (you try being on your feet on concrete floors for 12 hours a day working- it’s no treat) to keep up with demand (if there is any) and those might be up to $40K-$60K. That’s a fine salary coming out of high school. A skilled tradesman who’s been around for 20 years might make $100K working 7-12s, but does he have a life? And he’s be training for years through apprenticeships, etc. Who do people think are the customers for the businesses they work for? There is not a vast, faceless purchasing class that keeps the economy going. It is your neighbor who has disposable income to buy a boat because he works in a food manufacturing plant. In turn, the janitor at the boat plant can take his wife out to eat at the restaurant that your brother works at during the summer. The restaurant can buy food from the food manufacturer. It’s a cycle that only ends when A) all our disposable income is sent overseas buying foreign goods, or B) we have no disposable income due to our “global” salaries which allow us to eek out a living. Why do people assume that by slowly eliminating the middleclass that “America” will be more competitive and prosperous. Manufacturing touches every aspect of the US economy. Instead of bitching about how good other guys have it, why don’t more people demand improved wages and benefits? Why are a lot of people resigned to hand over the profits to the corporations (and their majority un-middleclass stockholders), only to wait by the table for scraps to fall? People who think that corporations are going to look after them are foolish and in for a surprise.
0

Share this post


Link to post
Share on other sites

Fortunately, they have a monopoly on a chunk of the market and can demand higher prices.  If they weren’t there, there would be no positive wage pressure.

[post="27774"]<{POST_SNAPBACK}>[/post]

All while GM has a negative pricing structure, meaning GM loses more and more each year. Then GM collapses and you wont have to worry about wages, because there wont be any jobs.
0

Share this post


Link to post
Share on other sites

A direct labor line worker doesn’t make $90-100K a year, even factoring in their solid benefit packages.


Maybe I exaggerated the line workers pay a bit, but you neglected to mention what value that 'solid benefit package' might have. How much do you think that FULL health insurance coverage for the employee and his family (not just while you work there, but until you die), a substantial retirement pension, and a JOB BANK that allows you to get 90% of your pay while you sit at home. If you take just health insurance into consideration, let's say it costs $1000/month for coverage for employee/family, that seems to be $12000 a year. On an average 2000 hour year, that converts to $6 an hour for just health insurance. Seems to me that the 'solid benefit package' is a little more than an unmentioned benefit.


A starting employee makes less than $15 an hour, while a soon to retire one maybe makes $28. That’s $30K to $56K a year. Add overtime (you try being on your feet on concrete floors for 12 hours a day working- it’s no treat) to keep up with demand (if there is any) and those might be up to $40K-$60K. That’s a fine salary coming out of high school. A skilled tradesman who’s been around for 20 years might make $100K working 7-12s, but does he have a life? And he’s be training for years through apprenticeships, etc.


My FATHER has worked in a food manufacturing plant as a line supervisor for 25+ years, walking everyday on that same concrete floor you speak of. He worked those same 12 hour days and missed alot of my games, etc, so I agree it's no life. But today, after 25+ years on his job, he makes $55k a year. He doesn't get full health coverage, although the company pays a large percentage of his insurance. His retirement is in the form of a company 401k in which he contributes a percentage of his weekly pay and the company adds a couple of percent match. He doesn't complain or begrudge those who make more than he does, as he has only a high school degree, in fact he feels fortunate to have worked for a company who has given him a stable job and income.

I'm not saying that union workers don't work hard. I'm not saying to fire them all, and hire replacements at half the cost. I'm simply saying that auto workers have NO concept of the real labor market that exists outside of the auto industry and the protection of the UAW.
0

Share this post


Link to post
Share on other sites
I have listened to all the "finger-pointers" on this thread til I'm blue in the face, but you have all missed the elephant in the refrigerator! I'm talking about our Federal government, and the laws that have been passed that reward companies that go offshore, and penalize companies that stay here. Futhermore, these foreign manufacturers that choose to come here to make their products only do it because we give them the welcome mat and concessions that will lay on the backs of our grand-kids. And nobody has even mentioned the elephants cousin, NAFTA and now CAFTA, which were blessed and endorsed by the politicians that you didn't elect, because you can't be bothered by "voting"! Global economy is B/S! It onlt exists because of greed and ignoring the fact that FAIR trade and free trade are not the same! We are still considered those dumb Americans, around the world. AND, our planet savers choose to ignore the reality of TODAY, and constantly wish for, "tomorrow" This whole dilemma requires envolvment, not sideline quarterbacks, who just fingerpoint and say, "go in there George and win the game." Except that George isn't an American anymore! He's Latin, or Japanese, or Korean, or some other ethnicity who couldn't care less about Americans, except for the size of their wallet----- and Washington keeps digging into it, to appease them so that "they will like us!" That is truly a dream that is turning into a nightmare!!!!
0

Share this post


Link to post
Share on other sites

Your content will need to be approved by a moderator

Guest
You are commenting as a guest. If you have an account, please sign in.
Reply to this topic...

×   You have pasted content with formatting.   Remove formatting

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor