Vmax540
VIP Member
http://foxforum.blogs.foxnews.com/2008/11/17/lpeek_1117/
There is only one reason to bail out the big three auto makers: fear. The economy is in such a rapid decline that the government is terrified that one more big shock will push it into free-fall. The bankruptcy of General Motors might provide the catalyst for…what, exactly? More layoffs? Fewer SUVs to sit unsold on lots?
Businesses across America can function without Chevrolets rolling off assembly lines; they cannot function without credit.
One argument for rescuing Detroit is that the government has fallen all over itself to help financial institutions, and it should be just as eager to help the car makers. There is no parallel. The urgency of preventing the collapse of large financial institutions has nothing to do with padding the pockets of financiers (the current popular rant) and everything to do with the globalization of financial markets and with the stifling of credit flowing within the economy.
AP
When Lehman Brothers went under, interrelated losses seeped into and destabilized every market around the globe. Businesses across America can function without Chevrolets rolling off assembly lines; they cannot function without credit.
We have in this country systems and protections in place that allow companies and indeed industries to fail, to reorganize, and to resume operations. Industries that suffer chronic overcapacity and incapacitating labor costs, like the airlines, are able to seek the protection of the courts as they merge, downsize and reemerge with newly competitive cost structures. This is what must happen with the autos.
Toyota makes automobiles profitably in the U.S. That is all we need to know. If the U.S. lacked the ingredients –had no raw materials, or machining capabilities, or no trained workers – then we could argue, if we deemed car making essential to our well being, that General Motors indeed needs to be subsidized. But we do have all those things –- we simply have crippling labor agreements that go back decades and that have turned our auto industry into a mini welfare state.
Some argue that we need to bail out the Big Three for national security reasons. That is bunk. Our defense industry is in great shape, and does not rely on Detroit. We’re not about to send Ford Expeditions to Afghanistan, as far as I know.
The truth is that our auto companies are not well managed.
They cannot respond to changes in oil prices and consumer tastes quickly because they are not set up to be nimble and flexible. For decades they allowed foreign companies to nibble away at their market share by making more reliable, better designed cars. Detroit has had plenty of opportunities in periods when the dollar weakened to fight for market share. Instead, they were content to raise prices and profits.
That’s because auto company managements suffer from the same short-term thinking that plagues the leadership of many other U.S. companies. The attraction of milking the last buck from making high-margin SUVs overpowered the near-certainty of a rise in oil prices and ultimate collapse in demand for their number one product. A longer view is especially important when you are unable to turn production lines on a dime; while foreign companies appear able to look ahead, ours are focused on the next quarter.
No one wants to see American workers lose their jobs. But it is an absolute certainty that if the government steps in to subsidize the auto companies, workers (and taxpayers) will ultimately pay the price. Eventually, unless the industry restructures in a meaningful way, our auto companies will disappear.
What must happen is a serious reworking of the industry’s labor agreements, restructuring of its financial obligations and new management that is charged with making these companies sharper, more nimble and more competitive. New executives should be handed incentives aplenty, based on five-year performance targets, to get the job done. Displaced workers need help with retraining, and with relocating, if necessary. It won’t be easy, but it is inevitable.
We want a U.S. automobile industry –- but one that can stand, and compete, on its own.
There is only one reason to bail out the big three auto makers: fear. The economy is in such a rapid decline that the government is terrified that one more big shock will push it into free-fall. The bankruptcy of General Motors might provide the catalyst for…what, exactly? More layoffs? Fewer SUVs to sit unsold on lots?
Businesses across America can function without Chevrolets rolling off assembly lines; they cannot function without credit.
One argument for rescuing Detroit is that the government has fallen all over itself to help financial institutions, and it should be just as eager to help the car makers. There is no parallel. The urgency of preventing the collapse of large financial institutions has nothing to do with padding the pockets of financiers (the current popular rant) and everything to do with the globalization of financial markets and with the stifling of credit flowing within the economy.
AP
When Lehman Brothers went under, interrelated losses seeped into and destabilized every market around the globe. Businesses across America can function without Chevrolets rolling off assembly lines; they cannot function without credit.
We have in this country systems and protections in place that allow companies and indeed industries to fail, to reorganize, and to resume operations. Industries that suffer chronic overcapacity and incapacitating labor costs, like the airlines, are able to seek the protection of the courts as they merge, downsize and reemerge with newly competitive cost structures. This is what must happen with the autos.
Toyota makes automobiles profitably in the U.S. That is all we need to know. If the U.S. lacked the ingredients –had no raw materials, or machining capabilities, or no trained workers – then we could argue, if we deemed car making essential to our well being, that General Motors indeed needs to be subsidized. But we do have all those things –- we simply have crippling labor agreements that go back decades and that have turned our auto industry into a mini welfare state.
Some argue that we need to bail out the Big Three for national security reasons. That is bunk. Our defense industry is in great shape, and does not rely on Detroit. We’re not about to send Ford Expeditions to Afghanistan, as far as I know.
The truth is that our auto companies are not well managed.
They cannot respond to changes in oil prices and consumer tastes quickly because they are not set up to be nimble and flexible. For decades they allowed foreign companies to nibble away at their market share by making more reliable, better designed cars. Detroit has had plenty of opportunities in periods when the dollar weakened to fight for market share. Instead, they were content to raise prices and profits.
That’s because auto company managements suffer from the same short-term thinking that plagues the leadership of many other U.S. companies. The attraction of milking the last buck from making high-margin SUVs overpowered the near-certainty of a rise in oil prices and ultimate collapse in demand for their number one product. A longer view is especially important when you are unable to turn production lines on a dime; while foreign companies appear able to look ahead, ours are focused on the next quarter.
No one wants to see American workers lose their jobs. But it is an absolute certainty that if the government steps in to subsidize the auto companies, workers (and taxpayers) will ultimately pay the price. Eventually, unless the industry restructures in a meaningful way, our auto companies will disappear.
What must happen is a serious reworking of the industry’s labor agreements, restructuring of its financial obligations and new management that is charged with making these companies sharper, more nimble and more competitive. New executives should be handed incentives aplenty, based on five-year performance targets, to get the job done. Displaced workers need help with retraining, and with relocating, if necessary. It won’t be easy, but it is inevitable.
We want a U.S. automobile industry –- but one that can stand, and compete, on its own.
I completely understand the "outside of the automotive industry" way of thinking, and in allot of ways I agree with the mentality. BUT this area is so driven by the big 3 as well as manufacturing in general to support the Auto Industry, if any one of the 3 crumble the trickle down effect will be devastating. Did our industry bring it on ourselves? probably in allot of ways - but it comes from the top not from the common worker that is now paying the price.
I have been an unfortunate victim of the times here in the Detroit area, our Company along with many others have simply closed the doors due to the recession with no light at the end of the tunnel. If you people really want to see us fail just in spite then please I am taking donations to help pay my mortgage and keep a roof over my family's head.
I have been an unfortunate victim of the times here in the Detroit area, our Company along with many others have simply closed the doors due to the recession with no light at the end of the tunnel. If you people really want to see us fail just in spite then please I am taking donations to help pay my mortgage and keep a roof over my family's head.
let them swing, if they go through bankrupsy maybe they can get the monkey(unions)off their backs, reopen with contracts that makes them a lasting company.
I will agree that unions have caused allot of the problems. I have always been non union without the benefit of "big brother", but what about the hundreds of thousands of businesses that depend on work from these company's? Obviously this does not effect you or your wife and kids.BETHEVIPER said:
It is truly a catch 22, I would love to see the stranglehold of the unions broken and start from ground one. I will be the 1st one in line for a job when that happens. But the reality is ALLOT of innocent workers are and will loose everything in the process, we have nowhere to turn. We cant sell our homes to move because the market is so bad, we cant simply find another job because there are none. Its not just hurting the people that deserve it, those guys can afford the hit - we cant.
Just for the record,
I am not pro "funding" or anti "funding", I am not smart enough to predict the outcome of either direction - I just want it fixed. Think this thing threw carefully and get it done.
The thing that irritates me the most is the spiteful "Let em Swing" mentality, I my friend have my neck in that perpetual noose with nowhere to turn and it does not feel good.
I am not pro "funding" or anti "funding", I am not smart enough to predict the outcome of either direction - I just want it fixed. Think this thing threw carefully and get it done.
The thing that irritates me the most is the spiteful "Let em Swing" mentality, I my friend have my neck in that perpetual noose with nowhere to turn and it does not feel good.
Well bankruptcy isn’t really a good option because it will effectively end the sales of that auto maker. Very few people are going to purchase a car from a manufacturer that they think isn’t going to be around to honor the warranty. Then you will have one or more of the major manufacturing employers in the country gone forever. If any one of you US “citizens” think this will not effect you, your head is buried so far up you’re a** it will take a union miner to find it.
What is the problem with government loans to provide the automakers capital to retool and move forward? Remember in the 80’s when Chrysler was staring into the abyss? If we’d have listened to the non interventionists then Chrysler would have gone under. Instead they got a loan, turned the company around and the US government made money off the interest from the loan and more importantly hundreds of thousands of middle class Americans kept their jobs.
I know it’s popular among the sector of our country that is right of Gangus Kahn to simply blame all the auto industries problems on the unions but the fact is there are too many complicated factors to go into here that have contributed to their weakening in the market. I will ask one thing of all those folks that think government has no place in the manufacturing business. How do you think all those Asian companies got started and rode out the lean years without going under? Have you ever looked at the trade practices of the countries of the competing auto makers? We’re going to need another miner if you don’t think that manufacturers like Toyota, Honda, Nissan, etc. aren’t getting help from their government.
What is the problem with government loans to provide the automakers capital to retool and move forward? Remember in the 80’s when Chrysler was staring into the abyss? If we’d have listened to the non interventionists then Chrysler would have gone under. Instead they got a loan, turned the company around and the US government made money off the interest from the loan and more importantly hundreds of thousands of middle class Americans kept their jobs.
I know it’s popular among the sector of our country that is right of Gangus Kahn to simply blame all the auto industries problems on the unions but the fact is there are too many complicated factors to go into here that have contributed to their weakening in the market. I will ask one thing of all those folks that think government has no place in the manufacturing business. How do you think all those Asian companies got started and rode out the lean years without going under? Have you ever looked at the trade practices of the countries of the competing auto makers? We’re going to need another miner if you don’t think that manufacturers like Toyota, Honda, Nissan, etc. aren’t getting help from their government.
Mighty
Member
Bischof, Chrysler is not a good comparison because they had two products ready to be unveiled; The K car and the Caravan. GM doesn't have an industry changer like those two on the near horizon.......They need the cash to meet payroll.............
And you know what's in GM's R&D how?
Vmax540
VIP Member
SX I have been there......all I can say is everytime I made a career move I always looked back and wondered why I waited so long ! Good luck !
I never understood the need/want for a full sized pickup/SUV as daily transportation Maybe, because I remember the 1973 embargo/fuel crunch and the big 3 complaining about the foreign vehicle sales because, they didn't have the cars with gas mileage to compete then, during the 1980's the big 3 crying about the slow but, progressive mileage mandates until they were set aside and then came the 1990's when they were only concerned with making high margin, gas guzzling SUVs and pickups. Enter 2008 and rising fuel prices and now they want our tax dollars (without any acountability) to retool and restructure to compete against the foreign vehicles ! Sorry, but the two should go hand in hand and we better start at the top !
B.T.W. it wasn't that long ago when most on here (not me) were making fun of the foreign choices with there small gas sipping engines.
I never understood the need/want for a full sized pickup/SUV as daily transportation Maybe, because I remember the 1973 embargo/fuel crunch and the big 3 complaining about the foreign vehicle sales because, they didn't have the cars with gas mileage to compete then, during the 1980's the big 3 crying about the slow but, progressive mileage mandates until they were set aside and then came the 1990's when they were only concerned with making high margin, gas guzzling SUVs and pickups. Enter 2008 and rising fuel prices and now they want our tax dollars (without any acountability) to retool and restructure to compete against the foreign vehicles ! Sorry, but the two should go hand in hand and we better start at the top !
B.T.W. it wasn't that long ago when most on here (not me) were making fun of the foreign choices with there small gas sipping engines.
Vmax540
VIP Member
Bischof said:
No but, two years ago I was looking for a fairly small car with decent milege so, being somewhat of a chevy fan I visited the local dealer and my choices were what a Aveo and Colbalt !
horkn
New member
I agree this is a tough situation. I am torn on how I feel about a bailout for the auto industry.
Ultimately the workers are the ones who are getting the raw end of the deal.
I work for an OEM that supplies pollution control equipment (thermal oxidizers) to companies like GM, Boeing, Hyundai, Bombardier, and a lot of others that are affected by the current recession/ financial issues. Our backlog is very good, and even if the new machine sales do drop off, the aftermarket parts (my dept) dept will pick up the slack because as long as these companies are still producing product, they require our equipment to comply with the EPA. EPA non compliance fines are usually a thousand dollars a day, so they have to be in compliance. So, essentially the company I work for is pretty much recession proof. But it still affects our bottom line. As long as the economy can turn around sometime in the next few months, we will be fine. But if this recession heads into depression, then the problem will be insurmountable I fear.
Ultimately the workers are the ones who are getting the raw end of the deal.
I work for an OEM that supplies pollution control equipment (thermal oxidizers) to companies like GM, Boeing, Hyundai, Bombardier, and a lot of others that are affected by the current recession/ financial issues. Our backlog is very good, and even if the new machine sales do drop off, the aftermarket parts (my dept) dept will pick up the slack because as long as these companies are still producing product, they require our equipment to comply with the EPA. EPA non compliance fines are usually a thousand dollars a day, so they have to be in compliance. So, essentially the company I work for is pretty much recession proof. But it still affects our bottom line. As long as the economy can turn around sometime in the next few months, we will be fine. But if this recession heads into depression, then the problem will be insurmountable I fear.
nailsandrails
VIP Member
I also feel for our American workers... Unfortunately I don't feel the same for the automakers themselves. We have a Chrysler and GM plant near by and for years it has been a running joke about people sleeping on the line... going in only to go back home and get paid for at least a half a day.. Many employees who have been allowed to work 20 hours of overtime a week all the years they have worked there... and the best is giving them 90% of their reg. pay when they are laid off. I know a few people that have been laid off more than they have worked for Chrysler. At 90% of their salary they do quite well and produce very little.
For me the mismanagement is so bad that I would be for letting them feel what every other business has to go through that would be managed similarly. They have the same opportunity to have lean manufacturing... cut OT to a minimum...etc... Since they haven't addressed those issues over the years it's hard to feel bad if they go under. Like has already been stated... The bad part is the great impact it has on the good American workers and surrounding suppliers.
For me the mismanagement is so bad that I would be for letting them feel what every other business has to go through that would be managed similarly. They have the same opportunity to have lean manufacturing... cut OT to a minimum...etc... Since they haven't addressed those issues over the years it's hard to feel bad if they go under. Like has already been stated... The bad part is the great impact it has on the good American workers and surrounding suppliers.
Bischof said:
Thanks Greg, that's a great post. Mine is one of the butts on the line over here in Canada. It's a gigantic race to the bottom of the pay scale and I just hope I'm still alive when it all comes full circle. When manufacturers are sourcing in the US because world labour rates have become too high. When off-shore automakers finally have legacy costs to include in thier bottom line.
There is a bottom to cost reduction that eventually every business will hit, regardless of industry. And when that finally hits, the cost reduction business model/management mentality will go by the wayside.
Mighty
Member
Listening to my brother inlaw who works in R&D for GM.Bischof said:
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crewchief47 said:
You know Ian it's been my experience that most the people telling the stories about all the crap union guys get away with share two common traits. One they've never been inside an auto plant and have no idea how hard the people on the line work and two they wish they had a job that paid as well and provided benefits that allowed them to take good care of their families.
Basicly their jelous.
Here's a nice little write up on the cost that labor adds to an automobile. Now it's from the UAW so there is an obvious bias there but I think it does put how much of an impact labor has on the auto makers troubles in perspective.
http://www.uaw.org/barg/07fact/fact02.php
ExpertXViper
New member
Bischof said:
Sorry man but my old man worked for Ford for 35+years as a engineer(NON UNION) and has step into just about every plant in MI, along with KS, IL, and Canada. Alot of the tales Snowdust mentioned are true, regardless what you may think. My dad being retired since Feb of this year has already been called back once as a contractor to work on the Ford Flex in Toronto, Canada and will possibly be going to Chicago this Dec-Jan for another launch, nice retirement huh???? But having alot of his money in Ford stock forces him back to work. Whats the reason behind contractors???? Dont have to pay Health care or 401K which='s lots oh $$$$$$$ saved vs. a typical Ford Engineer thats doesnt know his a$$ from a hole in the ground.
Theres alot of stuff that was mentioned above by Snowdust that happens much more than you think. Im in no way saying ALL blue/white collar workers are lazy and/or scam the system to get more hours but it does happen non the less. And Im sorry but a typical line worker SHOULD NOT make $60,000-$80,000/yr and still get payed benefits that they do. Most people with college degree's dont make that much in a year and you think paying lines people 60k/yr to install the same part over and over again with no education is a far deal????? IMO is not right and not profitable, and I believe thats part of the reason of where thier(Big3) at today.
Example of POOR Management- Chevy's 09 Traverse, part of the Vehicle Check In Process is to walk around the vehicle and make sure the "TRAVERSE" emblem is installed in the proper order cause the emblem has individual letters and many cars have had missed spelled emblems.
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horkn
New member
ExpertXViper said:
I have to fully agree with expertx. ( Is this twice now
? ) I used to work in Janesville for my Father's plumbing and boiler shop. As you are probably aware, GM has built the yukons, suburbans and such there for quite a while. Even as someone who worked in that city and did not even live remotely close, I have heard enough stories to warrant the existence of these perceptions.As GM is one of my current company's customers, I have heard stories from our techs that have been at those sites servicing our oxidizers that have been plain ridiculous. And then you hear stories from the same techs about how organized and thorough the japanese manufacturers are, even in the states, on the same types of assembly lines as the big 3.
I don't make the 60-80k a year, and I have a bachelor's degree, and am quite technical.
I should be making in that neighborhood, but I can say a regular line worker should not. I think the unions are to blame for this crazy pay scale.
Mighty
Member
And the lax work environment.horkn said:
yammiman
Member
Some very interesting points being made here - one more thing that should be pointed out (and someone correct me if I'm wrong) the Government is not "bailing out" these automakers per se - they are not giving them the loans - they are merely (if it is like the case with Chrysler) "guaranteeing" the loans - if the automakers go solvent, the Government will pay the money back to the banks - (I know, someone could argue the Government owns the banks!!) - but, as indicated earlier, this is not the first time the Government has done something like this - it has been done in the past with railroads, airlines, and automakers (Chrysler) - it would not be in the best interest of this country to let major corporations of this magnitude take a fall, especially during these troubled times
How did they get here? - poor business decisions, UAW, NAFTA, the banking situation, and greed all played a major role - all need to be looked at in the resurection - I hope the Government is smart enough to get some sort of business plan from them that outlines how they plan to pull themselves out of this - if I had anything to say about it, I would be requiring them to bring a percentage of their work back to the U.S.!!!
How did they get here? - poor business decisions, UAW, NAFTA, the banking situation, and greed all played a major role - all need to be looked at in the resurection - I hope the Government is smart enough to get some sort of business plan from them that outlines how they plan to pull themselves out of this - if I had anything to say about it, I would be requiring them to bring a percentage of their work back to the U.S.!!!
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racerrob6m
New member
Excellent post's by Expert, horkin,& yammiman.
You guys hit a grand slam with these post's.
As a former union member & shop steward in the IAM back in the late 70's & early 80's, I can recall MANY,MANY cases where our main focus was to SAVE some lazy-dumbass-good for nothing worker from getting fired!! He had THE attitude but he also had senority!! FREE RIDE JERKS!!!
And then there were the fine examples of when a new young hard working great attitiude employee with potential could not be kept due to "senority of the lazy dumbass" when things would slow down!!
Kinda like a "paid welfare deal"
Unions really equals socialism when ya really think it thru!!
Sorry, unions had their place in the 30's to the early 60's when mgmt. did not appreciate the asset employees are. Today, I believe many many succesful & well managed companies understand that the good dedicated employee is an asset & treats them accordingly.
I say, toss the damn unions, dump the deadwood, both in managment & production, demand a REAL solid business plan for their longterm growth including new sellable vehicles, & THEN fund it with strict repayment terms. JMHO !!
So until this is resolved, there will be PAIN!!
Hard to think that the BIG THREE today is "Hotwheels, Mattel & Tonka"
as Jay Leno said the other night!!! LOL
You guys hit a grand slam with these post's.
As a former union member & shop steward in the IAM back in the late 70's & early 80's, I can recall MANY,MANY cases where our main focus was to SAVE some lazy-dumbass-good for nothing worker from getting fired!! He had THE attitude but he also had senority!! FREE RIDE JERKS!!!
And then there were the fine examples of when a new young hard working great attitiude employee with potential could not be kept due to "senority of the lazy dumbass" when things would slow down!!
Kinda like a "paid welfare deal"
Unions really equals socialism when ya really think it thru!!
Sorry, unions had their place in the 30's to the early 60's when mgmt. did not appreciate the asset employees are. Today, I believe many many succesful & well managed companies understand that the good dedicated employee is an asset & treats them accordingly.
I say, toss the damn unions, dump the deadwood, both in managment & production, demand a REAL solid business plan for their longterm growth including new sellable vehicles, & THEN fund it with strict repayment terms. JMHO !!
So until this is resolved, there will be PAIN!!
Hard to think that the BIG THREE today is "Hotwheels, Mattel & Tonka"
as Jay Leno said the other night!!! LOL