Rant....Ford & GM stupid

[coldplugs]

This thread generated some useful discussion early on but has become repetitive and even offensive in some cases. I am surprised it has been allowed to continue.

 

[jlaird]

Wow, I have read nothing offensive here yet. Mostly just facts that most all the analysts agree on. Not preaty though.

 

[prb51]

I've read some strong opinions but nothing offensive. I don't find free speech offensive if I disagree with the speaker.
Offensive speech would be a personal un warrented attack removed from the point at hand etc....
I am heartened to see folks express their opinion on a touchy subject in times of some turmoil.
I would be disheartened if we, as a group, as a Country, become so politically correct and sensitive that we do not speak out on important subjects.

 

[racingenglishcars]

I have a daily driver. My newest vehicle, a 1992 Opel Astra, is built by GM. It's a fine car, ecxept it only gets 33 mpg, a little low for todays standards - at least here. We don't use it daily. In fact only on occasional weekends. I, my wife and my daughter ride bicycles daily to work and school.

Both I and my wife are members of our respective unions. I used to be in "Metal" but when I started at the office I became a member of "Engineer Union Denmark". My wife has been a member of "Children and Youth pedagogic country union" for many years.

You could say that I'm not anti-union. I am glad that the unions take care of the workers. On the other hand I don't think the Danish unions are greedy or profiteering. Without unions, workers are exploited. Child labour, unfair pay practices etc. Like this. With a proper balance, they are fine and desirable. It's too bad that the UAW etc couldn't figure that out.

 

[tony barnhill]

Okay, let's explore another direction of this discussion: it's almost a given that the Big Three (& the UAW) are going to get at least a $50-billion & probably a larger bailout next year. The mood in Washington will change and become more favorable to their requests and they are paying lobbyists big bucks to "wine & dine" the notables who have influence.

So, after they get our money & if we had any input, what changes should all 4 of them (GM, Ford, Chrysler, and the UAW) make to improve the industry?

 

[14dna]

Grow Up?

Just a thought.

Dave

 

[Brooklands]

Drop the many duplicate car models that are just badge engineered. Put emphasis on fuel usage and reliability. Reduce costs with new contracts and lower office expenses by eliminating waste and duplication of staffing. Reduce advertising just for the sake of advertising. How often do I need to see the same advertisement in one half hour segment on TV?

 

[Deleted member 3577]

Let's call the new company US Motors

We can cast FoGMCr into all the parts...
And years from now kids will wonder what it means

 

[vagt6]

They've got to produce cars that sell, and they've got to at least equal their competition in price and quality. That's going to become increasingly more difficult to do in the global economy.

I think some "attrition" is inevitable. At least one of the big 3 will fail, go belly up and not come back. And that is a loss to consumers: less competition is not a good thing.

Who will it be?? Will GM crap out? Chrysler is the smallest and seems to be the weakest.

The next year or so will tell, should be very interesting. Or, sad if you're an employee.

 

[GregW]

At least one of the big 3 will fail, go belly up and not come back. And that is a loss to consumers: less competition is not a good thing.

I don't think there will be less competition if one fails. The big 3 are competing against a foreign market more than each other right now. If one did fail, maybe it would shock the other two into the reality of the situation. "Buy American" doesn't float when the product isn't what the consumer wants.

 

[TR6oldtimer]

<div class="ubbcode-block"><div class="ubbcode-header">Quote:]Cerberus Capital Management, L.P. is one of the world's leading private investment firms. Cerberus specializes in providing both financial resources and operational expertise to help transform undervalued companies into industry leaders for long-term success and value creation. [/QUOTE]
This company bought Chrysler for about 7.6 billion. Should we bail a privately held company out, or is it about jobs. The later I think.

GM is in the worse shape, but again it is about jobs. A company with a negative balance sheet as far in the red as GM is not going to turn around easily, if ever, unless drastic changes are made to the business plan. Building envo-friendly cars (two years out) is not enough. A nanny company cannot survive in todays business environment.

GMAC was is also into real estate loans, and look here...

<div class="ubbcode-block"><div class="ubbcode-header">Quote:]GM owns 49 percent of GMAC LLC, with the rest owned by Cerberus Capital Management LP.

[/QUOTE]

Cereberus again. Not that I am a conspiracy guy, but hey, who are these guys?

 

[RonMacPherson]

Donn, I only spent 6 months in Europe in 72(other than a journey to Scotland in 96, but only for two weeks). Got to experience "working man's life"...

A lot of European "Unions" are more like guilds, based on trades and educating craftsmen.

Which I admire.

Encountered a few "Unions" like we have here in the US. Down in Portugal and in Italy. They reminded me of the "union" mindset that I encountered continuously when I lived in San Jose in the early 80's: i.e how much are you gonna pay me, what's in it for me and do I really have to do that work, or is this just good enough to "slide" by?


Unions, once were a strongly needed feature of working to offset those that thought of "workers" as basically wage slaves... Now it seems like they have become employee bargaining groups. The bureaucracy of the unions, like any bureaucracy, if not constantly monitored goes haywire.... Just ask Jimmy Hoffa-If you can find him?

 

[Silverghost]

Seems to me we have a massive group of ostriches with their heads in the sand, each one sticking to the thinking that had them stick their heads in the sand in the first place and very few having the sense to take their heads out of the sand to see what is really going on.

The big 3 execs showing up to Congress on private jets and limos - heads in sand. Unions and workers sticking to their contracts - heads in sand. A few of the ostriches have looked up and realized the sand is under 6 inches of ostrich droppings and said "This is bad news, who do we blame because this isn't OUR fault!? And how do we fix it?"

Does it strike anyone else as humorous that the big 3 plan a hybrid and alternative vehicle caravan to Washington to demonstrate what CAN be done? Isn't that like telling the captain of the Titanic he can close the watertight doors AFTER the iceberg hit?

It occurs to me that the ostriches are drowning and the ship is sinking. Does anyone speak ostrich?

 

[coldplugs]

Okay, let's explore another direction of this discussion...

A more positive approach. Excellent!

If I knew how GM should restructure then I'd be making a lot more money than I am now. Regarding the product lines only though, I'd like to see them cut back to fewer models overall for the US, and put even more resources than they now are into stronger entries in the Chinese, Indian, and Brazilian markets. GM has a good start in these growing markets and I think it's critical that they move fast to consolidate their positions over there. (The Chinese <span style="font-style: italic">love</span> Buicks - go figure...) These markets are critical to survival in a global economy and if GM loses there, they are destined to fail here as well. Those markets are huge and growing fast - let's get our fair share (~100%).

Also – I'd love to see the US auto companies make a serious effort at designing, marketing, and supporting modular assemblies that could be used be smaller companies to create cars the way computer companies use components from Intel, Toshiba, et al to create branded computers. GM could specialize in powertrains, Chrysler in integration and manufacturing support and so on. The challenges would be huge and the feds would need to do their part but it could revolutionize auto making in the US. Maybe some of the bailout money could be used for DARPA-like grants. This one needs a lot more thought...

Finally, I'd like to see the US manufacturers put far more resource into truly flexible manufacturing facilities. They've done "ok" so far but I think management still thinks of manufacturing as overhead and not as a weapon. If they need to create non-union subsidiaries to effect this, so be it. I'd create powerful manufacturing "research" facilities and if they grew to the point that they could flop over into "production" then union issues could be dealt with from a position of strength in those locations (which might be overseas).

Supper's ready – no time to save Ford and the rest.

 

[Randi]

You can't say they aren't trying........They just cut $7 million a year by getting rid of Tiger Woods as a spokes person.....the tide must be turning

 

[tony barnhill]

Okay, let's explore another direction of this discussion...

A more positive approach. Excellent!

If I knew how GM should restructure then I'd be making a lot more money than I am now. Regarding the product lines only though, I'd like to see them cut back to fewer models overall for the US, and put even more resources than they now are into stronger entries in the Chinese, Indian, and Brazilian markets. GM has a good start in these growing markets and I think it's critical that they move fast to consolidate their positions over there. (The Chinese <span style="font-style: italic">love</span> Buicks - go figure...) These markets are critical to survival in a global economy and if GM loses there, they are destined to fail here as well. Those markets are huge and growing fast - let's get our fair share (~100%).

Also – I'd love to see the US auto companies make a serious effort at designing, marketing, and supporting modular assemblies that could be used be smaller companies to create cars the way computer companies use components from Intel, Toshiba, et al to create branded computers. GM could specialize in powertrains, Chrysler in integration and manufacturing support and so on. The challenges would be huge and the feds would need to do their part but it could revolutionize auto making in the US. Maybe some of the bailout money could be used for DARPA-like grants. This one needs a lot more thought...

Finally, I'd like to see the US manufacturers put far more resource into truly flexible manufacturing facilities. They've done "ok" so far but I think management still thinks of manufacturing as overhead and not as a weapon. If they need to create non-union subsidiaries to effect this, so be it. I'd create powerful manufacturing "research" facilities and if they grew to the point that they could flop over into "production" then union issues could be dealt with from a position of strength in those locations (which might be overseas).

Supper's ready – no time to save Ford and the rest.

John, I'd love to hear what you think the UAW should do differently!

You can't say they aren't trying........They just cut $7 million a year by getting rid of Tiger Woods as a spokes person.....the tide must be turning

And did you notice, Randi, that one of the reasons they terminated the contract was that Tiger wanted more money! Guess he thinks he's qualified for a bailout also!

 

[coldplugs]

John, I'd love to hear what you think the UAW should do differently!...

Besides disband? (Just kidding...)

I'd like to see them take a far more proactive role in training their members. Not "soft" classes like wellness education etc but real career oriented training and maybe some certification programs for machinists, ME's, IE's and so on. They support some of this now jointly with the car companies but I'd like to see them create formal programs on their own that are good enough to entice high school & college grads to consider manufacturing as a career. The unions demand high salaries and good benefits from employers – they should step up and make their members so valuable that they're clearly ~worth~ what they're demanding.

The car companies used to do this sort of thing (i.e. The GM Institute and the Ford apprenticeship programs) but they don't any more. Community colleges & professional societies like SME have filled these gaps to some degree (pun intended) but I think the unions could do a real service here by certifying that workers are qualified for their jobs and tolerating management action if employees clearly don't do their jobs.

The unions should also realize that times have changed and that companies can't afford to foot 100% of the health insurance policies provided to workers. GM et al should be allowed to set an annual negotiated amount they'll pay – say $6000 – per worker for health care and have the workers pay the rest.

 

[tony barnhill]

A beginning.....

 

[aeronca65t]

....I'd like to see them create formal programs on their own that are good enough to entice high school & college grads to consider manufacturing as a career.

We do that with folks at the Bayway Refinery. It's a mix of union and non-union jobs.

....
The unions should also realize that times have changed and that companies can't afford to foot 100% of the health insurance policies provided to workers.

The UAW came to an agreement with GM for a new four-year labor contract last year that will transfer $46.7 billion in retiree health care liability to a trust fund that will be administered by the union.
Ford and Chrylser have similar agreeements.
For example, in the Ford deal, the settlement requires retirees to pay deductibles and co-payments up to $752 annually for families and $370 for individuals. Retirees' payments for prescription drugs also would rise. This is a unilateral change that retirees had to accept. For newer workers, the benefits are less generous.

Tony:

I've been away, but reading back a few pages,you quoted UAW president, Ron Gettelfinger saying:

"We will not make any concessions. It's up to the government to correct the economic problems that are affecting auto sales."

That is incorrect:

He actually said they will not make ANY MORE concessions.

The difference between those statements is like the difference between black and white

It is common knowledge that UAW concessions in the latest contract cause a typical new hire at GM to make slightly less than a new hire at the American Toyota plants (see my previous statement in this thread).

My honest sense is that the investor-class would only be happy if workers in American companies made the same wages as workers in China.

Actually, as long as the short-term profits yield a good short-term reward, it seems that many folk couldn't care less about blue collar worker compensation.

Which is why many blue collar wokers in this country join unions. For protection against managment driven to make decisions that please investors who only focus on the next quarterly cycle.

I am pretty sure everyone knows that the UAW benefits packages for workers has been strong for many years, thanks to agressive union bargaining. That's not news.

Investors are the owners of a company. And as long at investors made money, they didn't care what the management agreed to with workers.

There has been no great outcry from investors to fight unions deals as long at the gravy train was flowing.
To me this is an excellent example of typical "hands-off" ownership, with little regard for how a company works as long as it pumps out cash.

But as soon as the investors stop making money, they figure that they can restart the gravy train if they can weasel out of the deal that they, as owners, have agreed to.

When I was 13, I agreed to do a painting job for a mean-spirited neighbour. Being a dumb kid, he got me to agree to do the job for $15. I agreed without asking my Dad. And when I complained, my old man told me, "A deal's a deal......suck it up!". Throughout my life I have made some good deals and some bad deals. But I have never knowingly tried to weasel out of a deal I've made.

What I hear investors saying is that they want the companies that they own to go Chapter 11 so they can weasel out of obligations that they agreed to when they bought in to the company.

That is hardly noble.

The economic powerhouse that has driven the US economy and provided wealth and a good standard of living for most Americans is manufacturing.

Blue collar workers do the actual "work". As owners, investors typically add very little to the notion of long-term planning.

But investors seem great at Monday-morning quarterbacking when things go wrong. Unionized blue-collar workers are a handy whipping boy when investor/owners and managment fail at making sure the company is financially healthy.

Is there lazy, good-for-nothing union workers? Sure!
There's also lazy, good-for-nothing people in teaching, the military, the police, the medical profession and probably the butcher, the baker and the candle stick maker too.

The best and most efficient arrangement is when investors are activley *engaged* in the workings of a company....but that is rare. Most investors see companies as cash cows and little else.

I've worked on an assembly line and it's gruelling. Most of these workers accepted these jobs *because* they knew they'd get good wages and benefits. These days, new UAW workers understand that they will get less generous benefits. But those workers already in the system should have their contracts honored.

A deal's a deal......no "ifs", "ands" or "buts".

Anyway, all of this is a great distraction from the real problem of unregulated, predatory lending practices by banks.

And letting Lehman fail? My cat isn't even that dumb!

 

[racingenglishcars]

Sounds like what they really need to do is make a product that people want.

Obviously the SUV market was partially what they wanted, but you never know if people really wanted them or not. With Toyota and Honda selling better than anything else in America, there seems to be quite a demand for Toyotas and Hondas! Yes, the SUVs were profitable for a while, but not amy more, when apparently fuel costs too much or people don't have money to spend.

Sounds like the product that people want is something like a Toyota or Honda.

I just don't see why FoGMCr can't build this product, in reasonable quality to compete against the Nips. They do it in Europe! Heck, they can even still produce a product line taylored to the SUV and muscle car crowds.

It's the quality and economy issues why the average family would buy Nip' rather than American. They have lost trust in American quality. The only way to fix that is to build quality. There is no economy when an econobox takes a 50% depreciation in the first year. Good quality econoboxes don't do that.