Are UAW Union Bosses Abusing Their Positions for Pay?

[jal]

CNN has just anounced that there will not be a bail out for the big 3.
I guess that they will now call themselves "A BANK" and get money out of TARP.

 

[montoyas7940]

Saving the big three won't save U.S. manufacturing jobs. The car companies will continue to build more where it is cheaper to build. It is a race to the bottom.

How can a U.S. worker compete with someone willing to work for a dollar an hour?

What will continue to happen is manufacturing workers in the U.S. will suffer a decrease in standard of living. Along with the loss of good manufacturing jobs will be the loss of good jobs in every sector accompanied by a decrease in most peoples standard of living.

What I hope is that the "leaders" of this country will get a clue and devote the resources
being wasted on financial bailouts to investments in infrastructure. (Paulson is buying his next job with my kids money)

Perhaps energy is where the answer lies. How many nuclear plants will 2 trillion dollars build? What manufacturing process wouldn't benefit from cheap reliable energy?

Ok, that was almost a rant. But I am up past my bedtime. Sorry.

 

[Ivan Seeking]

How can a U.S. worker compete with someone willing to work for a dollar an hour?

If that was the problem, then Japanese auto makers wouldn't be building plants in the US.

 

[jreelawg]

Saving the big three won't save U.S. manufacturing jobs. The car companies will continue to build more where it is cheaper to build. It is a race to the bottom.

How can a U.S. worker compete with someone willing to work for a dollar an hour?

What will continue to happen is manufacturing workers in the U.S. will suffer a decrease in standard of living. Along with the loss of good manufacturing jobs will be the loss of good jobs in every sector accompanied by a decrease in most peoples standard of living.

What I hope is that the "leaders" of this country will get a clue and devote the resources
being wasted on financial bailouts to investments in infrastructure. (Paulson is buying his next job with my kids money)

Perhaps energy is where the answer lies. How many nuclear plants will 2 trillion dollars build? What manufacturing process wouldn't benefit from cheap reliable energy?

Ok, that was almost a rant. But I am up past my bedtime. Sorry.

On top of that the fact that a nuclear power plant or wind far etc, cannot be outsourced to another country. Let the japanese make our cars, we will make the fuel.

 

[mgb_phys]

If that was the problem, then Japanese auto makers wouldn't be building plants in the US.

And they certainly wouldn't be building cars in Japan ( or Germany) !

 

[Proton Soup]

maybe the japanese aren't paying their factory workers as if they were college degreed.

 

[Ivan Seeking]

I was watching a debate with a UAW worker who stated that US brand auto workers are paid the same as workers at non-US brand plants, here in the US.

The difference is that at places like GM, people work 25 years and then get a full retirement. From what I understand, that, and health benefits, are the anchors around their necks.

The auto makers need a large resevoir of skilled and educated workers. For example, how many robots might one find in an auto plant these days? You can't just setup shop anywhere and expect good results.

 

[Vanadium 50]

I'm going to make an argument for the bailout that I haven't heard before: the US government is partly responsible for the plight of the Big Three, so they have a moral obligation to help bail them out.

There has been a lot of complaints about the fact Detroit is making minivans and SUVs rather than "cars people want." Why is that? Station wagons used to be popular? the answer is CAFE - the federal fuel economy law. Station wagons were the largest vehicles in their class, and SUVs and minivans the smallest ones in their class, so by upsizing from a station wagon to an SUV, you've made the average fuel economy worse, even though you have improved the fuel economy in both categories.

In that respect, the reason that Detroit makes SUVs is because we, the people, told them to.

I don't believe we are entirely responsible for Detroit's plight. I do, however, believe that if we are honest with ourselves, we have to admit that we have some responsibility.

 

[BobG]

I really cannot agree with you here. I've bought two foreign cars already because 1) they are small and fuel efficient, 2) I wanted a car that didn't break down a lot, and 3) there was no small, fuel-efficient, reliable alternative made in America

The car companies' claims that there is or has been no market for small, fuel-efficient, reliable automobiles is, simply, a lie. If there has been no market, it's only because there has been nothing offered for sale by them. The American companies DO make small, cheap cars but they waste a lot of gasoline, and they are unreliable. This is because legislation requiring fuel efficiency does not exist. Why is that? LACK OF POLITICAL WILL of the American legislators.

In the meantime, perhaps half the American public has quietly moved on to foreign-owned companies who do offer these qualities.

The proposal is, to ensure that the future plans of these companies do place three values at the top of their priorities:

1) fuel efficiency
2) reliability
3) relatively smaller size (helps efficiency)

Americans have always been decent engineers and technologists, and our companies are capable of doing this if they are asked to do so. I think due to the recent rise in gas prices, the legislative will to act is now there.

Letting the companies "die off" out of residual anger at past mistakes may sound good on paper, but the consequences you speak of will not make anyone feel better.

So, I have not been convinced, yet, by any of your arguments to oppose the auto bailout, because I still believe that it will push the world economy into an even deeper hole.

But who can tell for sure? It's all pretty complicated.

When people act like they know for sure, I'm naturally sceptical. Even I, with all my godly powers, do not know for sure. And, I'm willing to admit it. And I am listening to your arguments as much as I am able, not that it matters. If government had ever listened to me, there would be lots of small, reliable, fuel-efficient cars, and I would not have to curse at huge gas-guzzling monstrosities every day.

Probably a more accurate description of US automakers' dilemma is their product compared to foreign products within each class. There is a demand for http://usnews.rankingsandreviews.com/cars-trucks/rankings/Affordable-Small-Cars/, but the highest ranked US car in that class is 20th (the Chevy Cobalt).

US automakers find it easier to compete in the larger, higher priced vehicles, such as SUV's (3 of the top 4 in http://usnews.rankingsandreviews.com/cars-trucks/rankings/Affordable-Midsize-SUVs/, where foreign competition is just starting to make inroads).

US automakers are probably about even in http://www.autotropolis.com/wiki/index.php?title=Top_10_Off-Road_Vehicles_for_2008 thanks to Toyota and Land Rover. Other foreign companies are making in roads, as well, though. (Had to go to an off-mainstream rater for off-road vehicles. The standard ones all rate the on-road performance of off-road vehicles.)

It isn't that American automotive engineers are less qualified than foreign automotive engineers. The built-in overhead of past labor agreements puts US auto makers at a disadvantage. It's overcomable for higher priced vehicles, but a serious handicap for lower priced cars.

It also isn't that managers in American auto companies are dumber than managers of foreign companies. Notice how quickly foreign companies move to create larger vehicles once the market's there.

 

[mgb_phys]

It isn't that American automotive engineers are less qualified than foreign automotive engineers.

There is a historical lack of any strategic planning. It's almost as if Ford and GM see their main competition as the other Ford or GM plants. Both companies own dozens of smaller US and foreign car companies but there is no cross over in the design or production.

What do the VW Golf, VW beetle, Audi TT, Audi A3, Skoda and Seat have in common? They are the same car, with different body kits sold at different prices. In contrast the Ford KA and Ford Fiesta are the same size, sell for the same price at the same dealer and don't share a single component. Even in the Luxury end of the market the Porsche Cayenne, Audi SUV and VW Minivan share the same expensive to design and tool parts.

This isn't just a US problem, when the various old British car companies merged they would make the same car at two different plants with incompatible parts! You had to know not only the model and year but where it was built in order to replace a fan belt.

 

[nuby]

Probably a more accurate description of US automakers' dilemma is their product compared to foreign products within each class. There is a demand for http://usnews.rankingsandreviews.com/cars-trucks/rankings/Affordable-Small-Cars/, but the highest ranked US car in that class is 20th (the Chevy Cobalt).

There's another problem in the auto industry which I haven't seen discussed yet. The value of new vehicles have dropped through the floor, not because of supply and demand.. But deflation as well.

Steel prices are down, and deflation is everywhere (stock market, real estate) ... But there hasn't been much of a decrease in new car prices.

 

[mgb_phys]

But there hasn't been much of a decrease in new car prices.

Dealers - there are 1.2M people workign at car dealerships (http://www.bls.gov/oco/cg/cgs025.htm) paying these guys to sit around all day and sell maybe 1-2 cars/week is the biggest slice of a car's profit.

Dump the dealers and the official dealer servicing, sell the cars from supermarket style lots with online ordering and options selection and knock $2K off the price of the cars plus you never have to talk with a car dealer.
Of course the loss of car salesmen would do huge damage to the nylon suit and cheap aftershave industries but they can be bailed out.

 

[edward]

http://cosmos.bcst.yahoo.com/up/player/popup/?rn=3906861&cl=10744205&ch=4226713&src=news

Lol. GM execs spend 20g on private jet to go ask for 25billion in Washington. What idiots...

Large companies typically do have corporate jets. Follow the jobs. Where do they get the planes? Many of them are now leasing planes instead of buying because it is less expensive. Leasing companies have employees.

Where are the planes built? Many of the jets are built by employees of Bombardier Aerospace Lear Jet Division in Wichita Kansas.

How about those custom interiors?? There is a division of Bombardier Aerospace here in Tucson AZ that installs the interiors in the private Jets.

 

[edward]

Dealers - there are 1.2M people workign at car dealerships (http://www.bls.gov/oco/cg/cgs025.htm) paying these guys to sit around all day and sell maybe 1-2 cars/week is the biggest slice of a car's profit.

Most salesman are paid commissions only. No sales = no pay check.

Dump the dealers and the official dealer servicing, sell the cars from supermarket style lots with online ordering and options selection and knock $2K off the price of the cars plus you never have to talk with a car dealer.

There has been talk of that for a several years now. Autonation is selling that way but they still have to have salespeople. The dealers make less than $1,000 on the average new car sale. They usually make more on used car sales. They make a lot of their money off of the financing and selling extended warranties.

Of course the loss of car salesmen would do huge damage to the nylon suit and cheap aftershave industries but they can be bailed out.

Hey cut that out my son started in car sales. He now manages a Honda dealership. His pay is partly based on total sales. It is way down from the $120K he made last year.

Less than a month after Bill Gates stepped down as chairman of software giant Microsoft, it looks as if he's found his new career: used car salesman.

Gates bought a lot of stock in Autonation.

http://www.nypost.com/seven/07242008/business/a_new_hard_drive_121320.htm

 

[mgb_phys]

Most salesman are paid commissions only

It's still money that has to come out of the car's price. As is the overhead for lots of large dealerships.

They make a lot of their money off of the financing and selling extended warranties.

That's the problem. The car is irrelevant - they are really unregulated loan salesmen.
The rest is made on 'authorised servicing' - I just got persauded to buy my first 'new' car, as opposed to $500 wrecks I normally own.
To keep the warranty I get to spend roughly 15% the price of the car having the dealer do servicing every 3000mi.
I would love to know why the engineering on this car is so bad it needs expert care every month.

Hey cut that out my son started in car sales

Whats the difference between computer salesmen and software salesmen? The car salesmen know they are lying
The car companies have to get out of the model of relying on the family man who automatically buys the new cadilac model every year from the authorised dealership and always pays for the warranty and extras.

 

[CaptainQuasar]

There's another problem in the auto industry which I haven't seen discussed yet. The value of new vehicles have dropped through the floor, not because of supply and demand.. But deflation as well.

Steel prices are down, and deflation is everywhere (stock market, real estate) ... But there hasn't been much of a decrease in new car prices.

Has deflation actually been reported for any major currencies? I hadn't heard that, although I'm sure it's a danger that the central banks are working to avoid.

⚛​

 

[edward]

It's still money that has to come out of the car's price. As is the overhead for lots of large dealerships.

Actually the service department of most dealerships makes enough to pay the overhead for the entire operation.

That's the problem. The car is irrelevant - they are really unregulated loan salesmen.

In part that's true. Although it is not the salesman who arranges the financing. It is always some creepy guy in the back office

The best thing is to make the deal with them , then tell them you are going to finance through your credit union. Oddly enough people are impatient, they want that car today, right now. So they go with the dealer financing.

The rest is made on 'authorised servicing' - I just got persauded to buy my first 'new' car, as opposed to $500 wrecks I normally own.
To keep the warranty I get to spend roughly 15% the price of the car having the dealer do servicing every 3000mi.

They tend to imply that the car be serviced by the dealership, but actually you only need to keep receipts of oil changes etc.

I would love to know why the engineering on this car is so bad it needs expert care every month.

LOL that reminds me of the inside joke that my son said is popular at the VW dealership: New buyers should just go ahead and schedule their first service appointment before they leave the lot.

A guy recently drove his new Passat home and parked it in his driveway. He went into get his wife to show her the car and when they came out it was on fire. The car was a total loss , but the guy still wanted another Passat. Now that is brand loyalty.

Whats the difference between computer salesmen and software salesmen? The car salesmen know they are lying

The car companies have to get out of the model of relying on the family man who automatically buys the new Cadillac model every year from the authorised dealership and always pays for the warranty and extras.

But the family man keeps coming back. They can't just chase him away.

 

[mgb_phys]

They tend to imply that the car be serviced by the dealership, but actually you only need to keep receipts of oil changes etc.

I think mine implied that the only oil used came from a shrine at Subaru and was blessed by the pope.

LOL that reminds me of the inside joke that my son said is popular at the VW dealership: New buyers should just go ahead and schedule their first service appointment before they leave the lot.

Bad dealers can do a lot of damage to a brand. I suspect VW wasn't a prime dealership franchise to hold and so the crap guys got it. They do a poor job of preparing and servicing cars and the brand gets a bad name - which means more bad dealers...

 

[CaptainQuasar]

Whats the difference between computer salesmen and software salesmen? The car salesmen know they are lying

QFT. As a former sales engineer who had to work with software salesmen, that's totally true. Some of them purposefully avoid getting any understanding of the software so that it doesn't interfere with the sales process.

⚛​

 

[montoyas7940]

If that was the problem, then Japanese auto makers wouldn't be building plants in the US.

Ummm, they're not.

 

[mgb_phys]

Ummm, they're not.

http://www.reuters.com/article/americasDealsNews/idUSTRE4AG7DU20081117

 

[montoyas7940]

That is good news.

How much did it say the pay was? $18.00 an hour.

I will stand by my race to the bottom statement. I understand that there are more factors at work than the workers rate of pay. However with nafta and the recent expansion of nafta, things will not improve for U.S manufacturing workers.

 

[CaptainQuasar]

If that plant just opened then it seems like it probably would have been started before the economic downturn began. And Honda may well have received economic incentives from Greenburg or the state of Indiana, just like the quarter of a billion dollars spent to bring the Mercedez-Benz plant to Tuscaloosa, Alabama that I mentioned earlier with references. (I saw the same thing cited on the news just today.)

⚛​

 

[Ivan Seeking]

Yes, until foreign producers are required to meet the same environmental, safety, and working standards that we have, the playing field is heavily slanted against us. This is one issue that Obama has promised to address.

This is another example of the complete failure of the free-market as it applies to today's world. You can't protect the environment and compete with people who don't.

 

[montoyas7940]

If that plant just opened then it seems like it probably would have been started before the economic downturn began

It was.

Toyota recently put U.S plant construction on hold. And Nissan is moving some models to Mexico and Japan.

 

[Ivan Seeking]

If that plant just opened then it seems like it probably would have been started before the economic downturn began. And Honda may well have received economic incentives from Greenburg or the state of Indiana, just like the quarter of a billion dollars spent to bring the Mercedez-Benz plant to Tuscaloosa, Alabama that I mentioned earlier with references. (I saw the same thing cited on the news just today.)

⚛​

That has nothing to do with the rate of pay, which was the issue. If anything, the pay differential between US and foreign workers has improved in recent years; in some cases, dramatically so.

 

[turbo]

GM is returning two of the private jets it leases. Farther down in the story, we find out that GM still has 3 more. According to the story, GM and Ford require their CEOs to use private transportation for security purposes, but there is no explanation for why GM needs to have three jets on hand.

http://news.yahoo.com/s/nm/20081121/bs_nm/us_gm;_ylt=Apu7a_NS97I2wllfvYY5twCs0NUE

 

[jal]

http://online.wsj.com/article/SB122722835387246299.html
OPINION NOVEMBER 21, 2008
The Auto Makers Are Already Bankrupt
Admitting the obvious is their best chance to restructure.
By PAUL INGRASSIA

The biggest beneficiaries of a GM-Chrysler merger would be Cerberus, the private-equity firm that owns Chrysler, and the big banks that hold billions of Chrysler bonds that they haven't been able to sell. The bonds were used in Cerberus's purchase of Chrysler from Daimler. The banks expected to sell the bonds to investors, but have been left holding billions in Chrysler debt that they'd dearly love to unload.

Cerberus has offered to forego any profits on a sale of Chrysler, but that's phony. There won't be any profits. Just relieving Cerberus of the need to keep funding Chrysler would provide the private-equity moguls with a bonanza. As for the banks holding Chrysler bonds, didn't we already bail them out? Why should we have to do it again?

 

[jreelawg]

I bet they don't want to go bankrupt for the same reason the financial institutions don't want to. Bankruptcy court will expose their fraud and accounting errors.

 

[turbo]

I bet they don't want to go bankrupt for the same reason the financial institutions don't want to. Bankruptcy court will expose their fraud and accounting errors.

Bankruptcy court audits might also show that other stuff that goes on in corporate America. Stuff like depressing stock values before board meetings, so the board will offer top execs stock options at that very low price. The execs can then manipulate the short-term value of the stocks in order to make personal fortunes exercising those options. The quarter-by-quarter fixation in American corporations is a recipe for long-term disaster, and now here we are.

 

[jal]

Can the big 3 make a comparable model to the Nano for $2,500?
Just what we need to do the groceries.
http://www.cbc.ca/consumer/story/2008/01/10/nano-tata.html
Tata Motors rolls out Nano, the world's cheapest car

 

[mgb_phys]

The last thing a car company wants is a car that cheap. The defence against it for the last 20years has been to demand increased safety features, which leads to bigger cars, which leads to more damaging crashes which leads to a demand for more safety features.
would the roads be safer if eeryone drove one of those or if everyone drove a hummer?

 

[Office_Shredder]

If everyone drove one of those, and one person drove a hummer, he'd be the safest person on the road by a lot

 

[Vanadium 50]

would the roads be safer if eeryone drove one of those or if everyone drove a hummer?

Yes. Studies show that the safest conditions are when the majority of vehicles are within a factor of 2 in mass of each other. If everyone drove Hummers, things would be good. If everybody drove Yugos (why do Yugos have rear window defrosters? To keep your hands warm when you push!) things would be good...well, safe. It's mixing where things get dangerous.

 

[WarPhalange]

It would be safer with smaller cars, period. Crashes involve less total momentum involved (lol 0 if they're going the same speed at each other), and hitting a pedestrian or cyclist is a lot less damaging when it's done by a go-kart than a tank.