U.S. Auto Industry deserves the grave they dug for themselves

by drew sagan 76 Replies latest jw friends

• 

  hillbilly

  Drew..+1

  the big 3 have allowed a bloated UAW to rule the roost too long. I am all for Unions (20+ years IBEW) but after living and working near the Auto business I dont know who to feel sorriest for. GM FORD and MOPAR have stayed with a upper labor model that still assumes that engineers and draftsman and shipping clerks, assistants and administrative work are still done as they were in the 1930... with bloated staff numbers to match a "paper driven" workload

  The 800 pound Union Gorilla that gets way to much for the value of the work it's members do ; or the Companies that continue to tolerate the nonsense.

  TRW bought out Delphi (and Delphi still worked under the old GM contract) ...TRW simply "enforced" the contract and things got a lot better....Deadwood got fired, rules were followed and money was made. TRW also cleaned out the top end, GM style deadwood at the top of the labor chain. The hallways and cube farms at TRW are empty these days.

  Non of the BIG 3 got the memo about the 70's or 80's yet. American cars are about the best they have ever been... last for a long time....but the product doesnt match the market and BIG 3 exects have watched that ship sail away to, first Japan, then Europe and nowdays Korea.

  Side note about trucks... if GM would build me a truck like the '68 GMC I used to have ...welll I'd buy 3 of them next year. Big 6 cylinder engine... tourqe to spare, a real "truck 4 speed" with a double- low first gear and a 1-ton axle on a 3/4 ton frame... It could tow about anything I could hitch to it... 30 gallon tank... and 20 mpg empty... and it cost less than $5K new.

  But most chicks wouldnt ride around the block in a truck like that today... So Dodge- keep running your stupid ads aimed at stupid boys trying to snag chicks with a "big" truck. That Old POWER WAGON you guys used to build was a big- boy toy with balls of steel... but your kidneys would bleed after riding in it 50 miles and the AC was only cold with the windows down at 50mph.

  Rant over

  ~Hill
• 

  keyser soze

  I agree that the companies made mistakes, as did the unions. We fell behind other nations in quality and fuel-efficiency. Having said that, I'm not so sure that them going under will be better for our economy than bailing them out. I think any bailout should come with the condition that they contribute at least some of their resources toward improving fuel-efficiency, and the development of alternative sources of fuel.
• 

  hillbilly

  .....ford & gm pay workers $70+ an hour, toyota,etc pay $40+ an hour.......we wonder why our vehicles have gone from $3,000 in the 60's to over $25,000 now.if this bailout is done, americans are simply giving in to more extortion from the unions.......

  Even with bennies on the check line workers in a GM plant dont come close to $70 bucks an hour. GM FORD AND MOPAR went to a two tier wage system several contracts back.. low seniority people dont make much at all and the bennies are cut back. It' takes a while to get into the $20-30 hour range in an auto plant and those folks have some manufacturing skills.

  The $27 hour fork lift driver or pallet stacker is a thing of the past. GM FORD and MOPAR also allow contract workers in the same plant were the contract is in place.... that baffes me too.

  But if you want to bitch about union-company stupid policy look at GM's furlough ...pay people scale ( not Unemployment) to stay home... just in case a job opens up .... for years sometimes. That's the bloat that has to go.
• 

  Big Tex

  So out of this 700 billion, they want to save 2.5 million American jobs by sending 25 billion to the auto makers??
  
  
  
  
  
  I think they should go through the bankruptcy process. There would be more transparency and the bankruptcy court would have authority to demand accountability from the auto executives, having them justify their expenses. The court could order major restructuring that Congress could not. It would be a painful process but in the long run, with new, competent management, the auto industry could, emphasis on could, be a better, more functional industry.
  
  I would be against handing them a blank check without accountability or major restructuring.
• 

  Junction-Guy

  Cars have too much crap on them these days, they need to start making them more affordable and get rid of all the unnecessary gadgets. They need to offer a choice for both budget and luxury buyers. Over half the gadgets on my car are not needed.
  
  We have become a greedy society that values gadgets and keeping up with the Jones's.
  
  If people can't afford to buy the cars that are coming off the line, then trim the fat so to speak.
• 

  hillbilly

  J-G... folks wont buy a car without gadgets now days.

  You would be suprised how much of that $New car cost goes to lawyers, lobbyists, and liability. We are probably still paying for the first padded dashboards and collapable steering wheels and impact bumpers put on cars ... and we are paying for airbags, side impact ....rollover etc.

  It would seem to me that all that "safety" they build in would be part of any competitive edge the maker would like to create... and not driven by regulation. But folks wont pay extra for it so we get it "mandated" up our tushies.

  That old '37 Chrysler Airflow... they rolled it down a hill and drove away with it in a filmed ad... one of the lowest selling cars of all time...go figure.

  Hill
• 

  SnakesInTheTower

  this has been a hot topic in my college online microeconomics class...as you may imagine, the opinion of a 40-something is not popular with 20 year olds who think they know it all.

  short answer: NO BAILOUT MONEY...let the big 3 each other..... here is why....

  I think if the Big Three dont get the bailout money that one of the automakers will go belly up....probably Chrysler. Chrysler is the weakest of the three. I figure if that happens, then the people buying Chryslers will start buying Ford and GM products. Some will buy the foreign brand (but increasingly US made) cars, but most want "American" made (or at least American branded..often made in Mexico or Canada).

  American automakers can make cars cheaper in Mexico because of cheaper labor and in Canada because the health care costs are absorbed by the Canadian government (and ultimately the Canadian taxpayer).

  What will happen short-term and what will happen long-term? Short term it will be very very bad for the US economy. Unemployment will go to double digits...not just from the loss of automobile manufacturing jobs, but from automotive related industries...parts manufacturers, suppliers, vendors, etc..... then the money that wont be spent...trickles out to the rest of the economy. Domino effect. And yes, the US government (aka taxpayer) will get stuck with some of the pension obligations..but it will be less than the $50 billion....

  long-term...it will be a very good thing as the economy corrects itself. Market equilibrium will be reached as Ford and GM (and the other manufacturers) will have one less competitor to deal with. Ford and GM will start making less gas guzzlers and more fuel effiecient vehicles. Ford and GM may not yet be done with plant closings, shift ending, and layoffs. All of these employees will eventually find new jobs....or start new businesses....small business is 75% of the US economy. One or more of those new small businesses could be the next Google, Yahoo, Apple, or even another car company.

  If in the end we end up with the Big Two (Ford and GM) or The Big One (Ford General Motors), then the market will have corrected itself...without government bailout money. You will still have lots of choices...Toyota, Nissan, Honda, Kia, Hyundai, BMW, VW.......

  anyone even remember a car manufacturer named AMC (American Motors Corporation)? That company was a result of a merger of Nash-Kelvinator and Hudson Motor Car (who ever heard of them?)....when AMC started going down the toilet....they joined up with Renaut......and guess who bought AMC in 1987? yep....Chrysler...

  The world goes round and round.... no bailout money for them.....

  Snakes ()
• 

  BurnTheShips
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  hillbilly

  Snakes is right. Over the years there have been well over a dozen US carmakers merge or fold up as markets change.

  How many of you kids had a Studebaker.? (some of it's assets went into AMC and later AM General (who build mil spec Humvees and busses)

  Nash.Nash Rambler, Hudson? Auburn, Cord? DeSoto? Kaiser, Kaiser Frayser? LaSalle (a cheaper Cadillac)?

  GM dumped the Olds brand... I'd expect to see Pontiac or Buick go next. Market corrections.

  I heard that the hard assets at GM are worth about $2 Billion... and we want to dump $25B into them... Tex is right... let em go bankrupt and see who picks the bones over.

  Hill
• 

  iceguy

  Deputy Dog, The name of that movie was "The Car". It was made in the late 70's...My oldest Brother took me to see it at the theater.