By the end of the year, America’s automotive landscape will have changed dramatically. Chrysler Group will have new owners with new ideas (including, perhaps, dissection). Ford may or may not be in Chapter 11. General Motors’ fate is equally unclear. One big gas price spike and it’s all over bar the filing. And then there’s the United Auto Workers (UAW). This is the year the UAW renegotiates its contracts with The Big 2.5. If the union digs in its proverbial heels to maintain the status quo, Detroit’s doom will be delayed, but not prevented. As will their own.
The decisions made this week at Detroit’s Cobo Center will answer that question. The UAW’s quadrennial convention on collective bargaining opens today. About 1500 delegates representing over 800 locals from around the country will convene to discuss a number of issues facing the moribund union. They’ll have two days to establish their stand on issues ranging from contract concessions for healthcare and pensions, to what to do about their dwindling membership. They have two days to decide the future of the American automobile industry.
It won’t be easy. Just as GM is trying to extricate itself from rebate hell, the UAW must try to find a way NOT to give The Big 2.5 large concessions on healthcare, wages and pensions. Although the union’s “historic health care giveback” involved a $2b pay-off, common wisdom says the union is ready, willing and able to help Detroit roll-back their crippling labor costs. We’re going to find out exactly how far the union is willing to go to give aid and comfort to their employers.
That depends entirely on which faction within the UAW is sitting at the table. Although labor unions tout solidarity and the value of a united front, there’s a genuine power struggle going on behind the scenes.
On one side, some union bosses are happily extolling cooperation; they’d like the press, their members and the rest of the car industry to think the UAW is management’s best friend. Jim Graham, president of UAW Local 1112 stated ‘‘Management is not the enemy. They’re trying to do the same thing we are: save plants. The enemy is the Asian market.’’
Yet Graham also admits the UAW wants to get in bed with “the enemy.” He notes the UAW is trying to organize workers in the transplants’ factories. Oblivious to the fact the workers in the non-union Georgetown Toyota plant made more last year on average than UAW workers did in Detroit, he states ‘‘In order to get a decent wage, people have to be organized.’’
While the UAW’s making nice with management and trying to move into enemy territory, they seem to have forgotten that their past demands got them where they– and their employers– are today. The bountiful benefits they demanded (and received) when times were good are the excess baggage dragging down Detroit, now that times are tough. When the concession demands begin, we’ll see how long this new friendship lasts.
This brings us to the other end of the spectrum: hardcore factions within the UAW who want nothing less than a return to yesteryear. Soldiers of Solidarity, comprised mostly of Delphi and GM employees, will picket their own union’s meeting this week. They want the union to take a hard-line stance against wage cuts, pension changes and healthcare concessions.
Believe it or not, the Soldiers don’t believe The Big 2.5 are in dire straits. And they continue to see the company through the prism of class war; why should the fat cats be allowed to take food off their table? Strange but true: there are plenty of union members who’d prefer their employer’s death before personal “dishonor.”
So where does UAW President Ron Gettelfinger stand? On the fence.
"There is a great deal of uncertainty in the auto industry right now, which causes a great deal of concern among our members and their families. We're doing our best to address those concerns – but it doesn't do anybody much good to try to predict the outcome of a bargaining process that hasn't even started yet."
No matter. Gettelfinger knows that it’s make or break time for the UAW, without any clear path to “winning.” If the “modernizers” hold sway and the UAW makes company-saving concessions to save its own skin, the union’s power over its members will diminish. As Sean McAlinden from the Center for Automotive Research said, “What’s at risk here are the core values of the union.”
On the other hand, as Dave Cole from the Center for Automotive Research stated, "The existing situation is not survivable. The choice is, are you going to do something different or are you going to die with the domestic industry."
Whatever happens in the next two days, either way, Detroit will never be the same again.
I used to be anit-union until I saw workers at my old company fired on Friday and re-hired on Monday by a diffrent company to do the same job for less money. They lost their benifits, their vacation, retirement…etc.
Unions have their place and time. That place and time has passed in the domestic automotive industry.
I’m not saying they should go entirely. I just hope they will realize that they are part of the ‘team’ at Ford, GM, and DCX. It would benefit everyone if they step back off their unnecessarily high OT wages, benefits, etc…
I believe the UAW lost the battle when their organizing efforts failed at the US operations of Nissan, Honda, Toyota, and Aisin. Now it’s pretty much an effort to maintain a “controlled descent” with some survivors rather than a total “crash landing”
I really don’t think anything gets decided this week. It’s an informational meeting. Typically the delegates are the plant chairman and president, who are often as much in the dark as the rank and file. I’m guessing there’s a very small group of people in the UAW that has an idea of how they will approach the negotiations.
I’ve been saying for years and years that “This has got to be the year for a strike!” And it’s never happened. The auto companies have just given the store away repeatedely – ie. $3,000 signing bonus, plus a 1%/year raise, on top of the cost of living raises tied to the CPI. The rest of the unskilled world has gone the other direction the last decade.
So – this might be the year for drama. The 2.5 cannot afford to give the store away. The truck/SUV cash cow is dead. I think the UAW will bring a contract to the people that will be voted down. As the article said, there are many who would rather kill the golden goose than accept a little less. There are too few young people who need the job for the next 30 years.
I’ve said it before – it’s gonna get interesting.
I find it hard to think there are UAW members who genuinely believe the big 2.5 aren’t in bad condition.
The Soldiers of Solidarity (?!?) and their retarded older brother, New Directions, are total whack jobs. Plain and simple. Their view of reality is extremely distorted.
What they say in public is meaningless. Don’t forget that many union officials are elected.
“I used to be anit-union until I saw workers at my old company fired on Friday and re-hired on Monday by a diffrent company to do the same job for less money. They lost their benifits, their vacation, retirement…etc.”
Then they should have walked. Relocated to another part of the country if need be. Everyone needs to put money away for such circumstances, especially when earning above average union scale with no healthcare expenses to speak of. Financial self defense is a full time job.
The UAW workers have seen this all coming for 4 years. The crash of the SUV market and low interest rates for homes gave the smart one’s a window of opportunity and a hint: get out of the auto business while they still can.
Gone are the days when jobs, benefits, and everything else are taken for granted. People, including organized workers, have to start taking responsibilty for themselves, something unions are good at taking away from workers.
The thought of my wage, raises, work position, and advancement being decided by collective bargining is chilling. How many goof-offs and sub standard people earn too much money for too many years in a car plant?
My bet is they take a tough stance because they see Rabid Rick getting a bonus and all these foreign built domestics arriving in the dealers ( Aura, GTO, Milan, etc) and that they ride the 2.5 into the ground.
I used to be anit-union until I saw workers at my old company fired on Friday and re-hired on Monday by a diffrent company to do the same job for less money. They lost their benifits, their vacation, retirement…etc. Welcome to the world of the contract worker where this happens more often than you may realize. A business or government agency will contract with a company for workers in a specific field (e.g. info technology). The contract is for a specific time and when the contract comes back up for bid, a different company may get it. If the workers are still needed, the new company offers the jobs first to the people who worked for the old company to keep from having to recruit new employees; unfortunately, it's usually with lower wages and benefits than they have been making (they have to support their lowball bid somehow). Since they're considered new hires for the new company, they lose the leave they may have accrued with the old company. It's up to the workers whether they want to switch over to the new company and keep their existing jobs at lower wages and benefits or stick with the original company and hope they can find somewhere else to place them. Occasionally the specs for the new contract will include keeping the existing workers at their current salary and benefits but that's usually not the case.
GS650:
Didn’t Michael Moore’s Roger & Me mention how other local Flint, Michigan employers just wouldn’t hire ex-autoworkers as they couldn’t do anything else right?
Can you imagine an ex-UAW worker showing up for a job at a transplant? There’s probably a catapult to send those applicants away.
Actually “Roger & Me” was more about Flint’s attempts (sincere but comical) attempts to revitalize it’s workforce into something not dependent on the auto industry, but your point is correct. Transplant workers have to be able to do a variety of job in a plant, as opposed to the byzantine list of strict job classifications at unionized plants.
I for one don’t see any particular sign that the powers-that-be within the UAW have even as much as a finger on the pulse of economic reality. Over a half-century of us vs. them mentality has completely clouded their thinking.
Look for the 2007 Detroit Smackdown coming soon to a negotiating table near you…
Some random thoughts;
The Georgetown Toyota workers earning more than the unionized big three should send a clear message to the union that your employer’s sustained profit can benefit all workers.
If generous benefits are earned in good times, why can’t they be rescinded in bad times?
If the UAW were to cease to exist, what would happen to the generous wages and benefits offered by the transplants to their workers?
If the UAW were to cease to exist, what would happen to the generous wages and benefits offered by the transplants to their workers?
They might stay the same or go up as that would mean the US big 3 have pulled the plug (in their current form – Daimler-Benz flogging Chrysler- minus Jeep, GM & Ford in chapter 11 and in mexico and the south) and the UAW will have to change its name to the United Unemployed Auto Workers.
Michigan is going to be one sick state. One in 20 homes in detroit were up for foreclosure according to CNN.
I’ve never been in a union, but I worked in the front office of a unionized manufacturer doing IT support. My main memories of the job are these:
1) I was a young kid at the time, full of vim & vigor and excited to do my very best. I was on my way out to an office in the plant to take care of a PC problem. I was told by three different people to “Slow down!”. I stopped when the first one told me that and looked around – I was expecting to have just been missed by a fork truck. When I realized I hadn’t, I asked him why and he said “You make the rest of us look bad”. From that day on, I deliberatly walked consideraly slower in the plant to avoid any confrontation, and resumed my normal speed once inside an office.
2) I couldn’t move any PCs around the building myself. I had to load them on a cart, then call someone from shipping & receiving to move them for me, then I could unload them in the new location. I learned that, even though the shift ended at 4:30, I couldn’t expect to get a response if I called after 3:30, because “we’re getting ready to leave”.
I’m sure these are not representative of all union workers at all plants across this great nation of ours, but I’ll bet it represents enough workers at enough plants that it’ll totally kill manufacturing in America. Then, when the union coffers are dry, they’ll come crawling to the government looking for a hand-out because they’ve never learned the intrinsic value of working hard and *earning* an income instead of being *entitled* to one.
“The Soldiers of Solidarity”
These types of people exist in every union. There are workers who will vote “no” on every contract regardless of what it might contain. I doubt they know what CBA even means…much less read the thing. They give unions a bad reputation because they are militant zealots who make the most noise and are not guided by any sense of reason.
Check out Soldiers of Solidarity’s site:
http://www.soldiersofsolidarity.com
I’ll leave it to the readers to make up thier minds.
From the Detroit News web site (http://www.detnews.com/apps/pbcs.dll/article?AID=/20070327/UPDATE/703270434/1148/AUTO01):
The protest meant to unofficially kick off the two-day UAW bargaining convention at Cobo Center essentially fizzled.
Nineteen protestors are standing across the street from the main Cobo entrance as 1,500 delegates stream into the expo hall. The activists bear signs with slogans such as “No more concessions” and “Rights for workers” and are handing out leaflets with the same message.
They want the delegates to stop accepting pay cuts, layoffs and reductions in healthcare and pension benefits from the auto makers.
Protestor Todd Jordan, 29, said that it was tough for many rank-and-file workers to take the day off or travel to Detroit to participate. He noted that 2,500 rank-and-file members already have signed a no-more-concessions petition.
Jordan and other dissident UAW members from the group called Soldiers of Solidarity maintain that recent buyouts and layoffs have severely dampened their efforts.
Jordan, a worker at Delphi Corp.’s Kokomo, Ind. plant, said that at his facility 81 percent of workers there are recent new hires working for half the wages of their predecessors who left for buyouts, early retirements or transfers out of the bankrupt parts company.
While some of the delegates are sympathetic to the Soldiers of Solidarity movement, many clearly are not. Jordan said that one of the delegates “flipped me off” outside of Cobo Center.
Largely, the delegates are ignoring the protestors as they head in for the first of two days of debates on a 103-page resolution that will serve as a guideline for this summer’s contract talks with auto makers.
Freeman, i’ve seen the same experiences too. its ridiculous, so antiquated and about time the union died. We get in trouble for so much as lifting a finger regarding anything that a child could do. I would love to get a camera and take pictures of the guys sitting around doing sweet FA and waiting in a line, yes a line. to clock out well before their finishing times. no wonder so much is wrong with the US auto industry. In the UK, modellers, designers etc all pulled together to get things done. Here you get shot and a warning from the Union for doing the same, look at how the unions affected the UK auto industry. Time for UAW extinction, put them all on contracts as modellers and designers can be, and if they dont pull their weight, wave them goodbye. good ridance.
Small after point, UK soccer clubs have clauses in their players contracts that if the team gets relegated down a division, your pay etc reduces to take into effect the new situation, and when you win promotion/do well, again you get bonuses/original pay is resumed etc. Same principles should be introduced into the negotiations, times might be tough now, but if their belief in the company is strong for the future its worth it. Why these UAW people can’t take off their rose tinted glasses and smell reality is beyond me. What scares me is i dont think GM etc have the balls to stand up to them.
Freeman:
Thanks for the laugh. That takes me back. In my experience they would have accused you of “Killing the job” ie. working too fast.
We young engineers used to have to find new and creative ways to move things around the plant that didn’t involve Millwrights, forklifts, Shipping or Receiving. Management didn’t care about our difficulties in dealing with a unionized workforce – we had deadlines to meet.
Someone scored what we called the “Apple cart.” It was basically like a table they wheel people around in hospitals or morques, but it had low sides on it. Boy, you could pile the air cleaners or headlights on that thing and push them around the plant.
Eventually someone got really pissed about it and it wound up smashed to pieces in a dumpster. Then it was back to pushing headlights around 10 at a time on a Rubbermaid lab cart. Ahhhh….the good old days.
Good riddance UAW.
blaming the workers is an old story… the problem with the domestic auto industry is not so much the unoins or the workers…. its the fact that not enough of the cars are being sold… deciding what cars to sell where, what the look like, and how much they sell for, is a mangement decision… also where to put r and d dollars and what kind or profit (or not) to show the public or pay the shareholders.
I cannot buy domestic products because there is nothing for me to buy. I like very small,high end, zippy, fuel efficient hatchback cars, not large SUV’s, trucks, sedans or coupes. The domestics have ignored me for a long time now.
The fact they have ignored me is management decision, not the unions or the workers. Make cars that sell, and the worker problems disappear. Why is it that nearly all of the off shore producers have figured this out – and none of the domestics have? Whatever the answer to that question, the answer does not start with blaming the union. I blame management.
Many years ago, the domestics were put in a tailspin because they had no nice fuel efficicnt cars. Now the domestics are put in a tailspin because they have no nice fuel efficient cars. Management has learned NOHTING in the process. Where were they? On the golf course? Having drinks at the pool? Tennis anyone?
Dont get me wrong, blockheaded people come with both blue and white collars. But place the blame where it belongs. Produce a car that I want, and I will buy it.
Whining because you cannot produce it AND its because the labor unions suck, just pisses me off.
The UAW sucks. Big 3 management have allowed this to be so for at least 30 years. Big 3 management, past and present, is 100% responsible. That much is clear. (In other words, management signed the contract that says I need a Millwright to move a few headlights around.)
The UAW members are simply the lightning rod for all that’s going wrong. Perhaps they all should have gotten MBAs if they have a problem with this perception.
Transplant management is 100% responsible for keeping the UAW out.
Transplants = largely successful. Big 3/UAW = largely unsuccessful.
At the root that is why you choose vehicles from “foreign” companies.
I have no clue as to how labor relations in Germany or Japan allow them to be successful, even with strong unions.
The unions are one part of the problem. The other part is the dealer network which maintains useless models and brands and too much competition at retail along with poor service. As rich local businessmen, Congress kisses their asses and doesn’t allow car sellers to sell direct or try any innovation in the retail market.
“One big gas price spike and it’s all over…” Boy that is so true. If gas goes up to 4 bucks a gal. the 2.5 will wither up and die. They still don’t have a decent small car. Ford owns a nice chunk of Mazda but they refuse to notice how Mazda is cleaning up selling smaller vehicles. The new American crossovers are SUVs in a friendlier package.
Real men of genius………
“Martin Shawl, 53, a 28-year Delphi Corp. and General Motors Corp. worker from Bay City, said he doesn’t believe the Detroit automakers are in financial trouble.
“It’s voodoo accounting,” he said, questioning the timing of the Chrysler Group’s losses and GM’s restatement of earnings due to accounting troubles
He said the union shouldn’t give back anything to the companies, and it should end a two-tier wage scale that pays new hires less than longtime workers.”
In 1967, only fourty years ago, the leaders in the US electronics components business were GE, Westinghouse, RCA, Western Electric (Bell) and Sylvania. The high tech volume product was the vacuum tube and they were being manufactured by the millions, mostly in the northeastern and midwestern USA. Most of these factories were unionized. The companies were also the early makers of transistors. In fact, Bell Labs invented them. However, during the 1970s a whole new breed of electronics companies arose in the western US. These companies were never unionized and were extremely nimble and flexible. Many didn’t survive, but the ones which did have names like Intel, AMD, Texas Instruments, etc. These were some of the first US based companies to move large portions of their operations offshore, starting with the labor intensive chip assembly process, followed by testing and finally by complete manufacturing. The electronics boom in Asia was fueled by these efforts. By the 1980s local Asian companies were competing with the US and European companies in the robust global semiconductor based product manufacturing. Today the world enjoys low cost, high performance computers, communications and entertainment thanks to this vigorous world market. We are using the fruits of that effort to talk about the UAW here today.
There is absolutely no way that the Intels of the world would have developed at the speed and cost effectiveness they did had their factories and cultures been union-centric. US based companies still compete and cooperate vigorousely with Asia based companies in the electronics field thanks to the flexibility and make-it-happen attitude which pervades the industry. Average wages in Silicon Valley remain amongst the highest in the nation as part of a vigorous ecosystem with more employeer and sub-industry diversity than most areas enjoy. IBM has remained a player through all of this in part because even it’s eastern US manufacturing locations have never had a workers union.
Jobs do not exist as static things. The union notion of “protecting jobs” is actually nonsense on a theoretical level. At any given time a “job” is simply an agreement between two parties to exchange effort for cash. Such agreements may last for hours or decades, it all depends on circumstances. There is no job as a static thing, it is mearly an understanding between two parties which in general either party can walk away from with a courtesy notice period. I have yet to see any union agreement which compels a worker to stay on the job for the length of the contract. All of the commitments are one way in these contracts with the company making promises and the worker free to walk away from the deal any time they like.
The UAW has outlived it’s usefullness by decades. Time has passed it by and it has become part of the problem rather than part of the solution. Their dream of organizing transplant factories will forever remain a dream. Do you think the Tundra would be being built in San Antonio if there was any chance of the UAW getting it’s nose under the tent?
“The choice is, are you going to do something different or are you going to die with the domestic industry.”
*ding ding ding* tell him what he has won!
It’s remarkable to me, knowing several union guys, that they truly can “think” (using the loosest possible sense for the meaning) that they are always right and the employers always are wrong. But with one exception, a Christian friend who works at a bankrupt auto supplier (and who’s job is only in place due to a Toyota contract replacing big 2.23434 work), most union guys simply believe that they are owed a living and then some. Like – better medical bennies than anyone else and no deductible. Like – sitting on their dead asses and collecting a paycheck in a “works bank” while their employer loses $2500 per car built. Duh! How long will such an employer manage to stay in biz? But they cannot, and will not, see this.
Now the flip-side. Management. Locally, a hospital bought another hospital 35 miles away, fired everyone (unionized nurses) and then said they’d hire people back with less wages and – by the way, no union cards needed. Completely illegal. Nobody lifted a finger.
So, while unions may be needed to fend off immoral and greedy employers, of any sort, it increasingly seems that the unions don’t seem to be able to do the job they were intended to do. In fact, largely, the job of policing such illegal and immoral activities has passed to the government – while likewise is not doing the job.
So, what to do?
How about personal responsibility? As in, workers and management and government.
Wow, what a novel idea.
I’ll work for an employer and agree to do so, they’ll agree to pay me a certain amount. If either of us wishes to terminate the situation, then either I’ll go find something else, or establish my own business. (So that the government can steal from me). See, we need to fix that too…..
As for cars, well, I’m sick of buying “crap” and dealing with dealers who do not understand that warrantees actually are supposed to be worth more than toilet-paper (i.e. the big 2.343432). So about 5 years ago, I started to boycott the Detroit companies and from here on out, I plan to try to buy quality – Honda and Toyota.
Where the cars are made matters little to me.
Ironically, in the future, the “Detroit” companies will be importing more outsourced cars than the “transplant” companies, if trends continue as they now are. Assuming, of course, that any of the “Detroit” companies even survive.
I agree that the UAW is past its sell-by date but I’m tired of seeing unions blamed for automakers problems. How is it that GM and Ford can’t deal with “crippling labor costs” but Toyota can apparently pay more and make a profit. The bottom line is GM and Ford are in trouble because they retreated from large chunks of the car market. What are Ford’s small car and minivan offerings? Whose fault is that? When Ford had a topselling sedan in the Taurus how many years did they wait until they updated it?.
Unfortunately for the autoworkers they now have to compete in a global car market against people who are cheaper to employ and probably better trained too.
How is it that GM and Ford can’t deal with “crippling labor costs” but Toyota can apparently pay more and make a profit.
Because Toyota did it in the right order: make a profit then pay more.
It seems that there are too many people in management and labor who are too busy dividing up the pie, and not busy enough making it bigger. The consumers have been telling them they both stink for a long time.
Personally, I just don’t get how you can run a business with so much fighting all the time. It only gets worse when everyone realizes the pie is getting smaller.
Tough love is the cure they need. At every chance we should tell them we don’t care and don’t want to hear about it.
We will buy the cars if they are the best value. SHUT UP AND BUILD THE BEST CARS!
PS Don’t go claiming they are the best until it’s obvious to everyone or it will be the last chance you ever get.
jerseydevil:
March 27th, 2007 at 11:12 am
blaming the workers is an old story… the problem with the domestic auto industry is not so much the unoins or the workers…. its the fact that not enough of the cars are being sold… deciding what cars to sell where, what the look like, and how much they sell for, is a mangement decision… also where to put r and d dollars and what kind or profit (or not) to show the public or pay the shareholders…
Management and the UAW are to blame. Management for making poor decisions and the UAW coming up with things like the job bank and strict rules on what a worker can do. Corporate America gets along just fine with 401k plans and at will employment. The company does well you make more money it doesn’t and you don’t as it should be. I wasn’t hired to move furniture around but if we need to do that everyone pitches in.
For a successful business there can be no “Us” and “Them” there is only “We”; all working for a common goal. You want to make money like the big wigs? Go to college get some loans/grants and do it. If you have the drive you can succeed, you are only limited by your own ambition and imagination. I have no compassion for those that do not wish to better themselves nor who take responsibilities for their actions. You want a retirement you invest your money. I’m banking on their not being a Social security check when I retire. I’ll make sure I’m covered myself because it’s the right and smart thing to do.
Let’s get the “Toyota pays better in Kentucky” thing straight. The Detroit media reported that the average blue collar worker at Georgetown was paid more that the average Detroit blue collar worker. The Toyo employees were pushed over the top in take home pay due to a rather large (average) profit sharing bonus. Fair enough.
But take home pay is not total compensation. Number one biggie difference is health care benefits. Several thousand dollars/employee/year difference. Also – paid days off. When I left I had 4 weeks of vacation and 17 paid holidays, plus 5 sick/personal days. Yes – you read that right. So when you and the people in Georgetown are working on the Monday after Easter, keep in mind that the Big 2.5 employees are getting paid to sit in the casinos blowing their money. How many cars/trucks will Toyota produce while Detroit is on thier European level of holidays?
Restrictive work rules as described above add cost. 10-12% daily, out of control, protected by the contract absentee rate. (Don’t ever buy a car built on Monday/Friday is still a valid rule.) And on and on.
Wages do not equal labor cost. That’s the true advantage of the transplants.
The UAW could learn from their British auto union counterparts, now that there is no longer a British-owned automobile industry other than a couple of cottage-industry players, famous though they are (such as Morgan).
Of course, the South Korean union at Hyundai are acting much like the British union did 30 years ago – hence, yet another reason for Hyundai to build more factories in the US and employ AMERICANS at good paying jobs – people who will actually work instead of strike continually.
So looking at the Hyundai situation, and the “trap” that the UAW have placed the Detroit car manufacturers, it can be seen that one way Detroit could get out of the situation is to do the same as Hyundai – move the jobs to where the work will be done well, and at a fair wage – and the opposite of Hyundai – move jobs OUT of the US and into South Korea (or China or Belgium or Mexico or maybe even Brazil) – in order to accomplish it. Ironic, no?
But the fact that this “is” condemns the UAW like nothing else.
My “gut feeling” for 2007? We are going to have one HELL of a recession start; gas prices are going to skyrocket (due to an Iran war); the UAW won’t budge an inch; the Detroit car manufacturers will either declare chapter 7 and close, or chapter 11 and try to dump the UAW (but it won’t work and they’ll end up Ch. 7).
Dismal outlook on what is starting out to be a nice year, I know, but that’s what I see in my crystal ball as a distinct possibility/probability. Not that I want ANY of it to happen, so please don’t shoot the messenger. I DO live in Michigan, in fact…
Frank:
GM and Ford made massive profits through the 90s off SUVs, thats when they agreed to the contracts they are now trying to renegotiate, unfortunately they didn’t anticipate the end of the SUV fad or new entrants to that market.
Sid Vicious:
“I have no clue as to how labor relations in Germany or Japan allow them to be successful, even with strong unions.”
Some ideas about this…
The Automakers in Japan and Germany don’t have the legacy costs that GM and Ford face. In Europe (and Canada) socialized medical care and pensions mean that the entire cost of maintaining an army of retirees doesn’t fall on the corporation that employed them, this has got to be one of the biggest reasons Ford and GM continue to invest in Canada rather than MI.
In Germany automakers have managed to stay profitable by moving up the value chain and investing in training and plants – in any case nobody is building an economy car profitably in Germany and jobs are gradually shifting to Eastern Europe.
Japanese automakers use a lot more robots than anyone else, my guess is they employ fewer and more highly trained workers than elsewhere.
I would also guess that Japanese and German automakers invest way more than GM or Ford in worker training etc, to try and make sure their expensive workers have productivity to match.
All these complaints about unions and “european” holidays. A number of the car companies that are in europe are currently kicking our asses with unions AND 8 weeks of vacation. Why? Because they make cars that people buy. Hell, VW has a 33 hour week. My friend in Greece has 10 weeks off a year and he’s a junior computer system engineer! We here work like demons, make little money, have little vacation, and can get fired if out employer dislikes the color of our shirts!!! I am flumoxed by all this. My Italian cousin i swear hardly ever works, makes a decent living and travels six weeks a year! HE is 33. Here a 33 yr old is happy to get a week.
Your right, no more unions. Great. Work 12 hours a day six days a week, get fired cause u can be. What is the matter with us? Do we value ourselves so little?
Sorry about this, its a pet peeve of mine.
As Sid has explained, Toyota gets much more productivity out of a labor dollar. And retirees (“legacy costs”) aren’t much of a burden for ToMoCo. GM/F/DC have huge retiree health costs, too, further contributing to the Ponzi-scheme effect. It’s a downward spiral: more retirees hike costs while market share (revenue) shrinks faster than fixed overhead can be trimmed. The market is moving away from the 2.5’s gas hogs, but their non-luxury cars must be built outside the US to make any profit. The brontosaurs are doomed.
So socialized medical care is the key to improving the capitalist system in the US… hmmmmm….. Sounds like someone is all mixed up in their political philosphy.
The Unions are a huge part of the problem but can’t see the forest through the trees…
Here are some of United Auto Workers President Ron Gettelfinger’s comments of late:
Accused hedge and equity funds of “stripping and flipping” companies they buy.
“Our union is on guard to protect the best interests of our membership”
“It would be a grave mistake to equate our actions to capitulation”
It doesn’t sound like the UAW wants to play nice in teh sandbox at all…ever!
Toyota and Honda can manufacturer world class product on American soil with American labor…what is wrong with this picture?!
UAW needs to wake up!
JerseyDevil,
VW is in deep kim chee and trying to both pare the headcount and get more work hours out of their union. Trying to do so got VW’s boss fired, as the union has too much pull with the “true” boss, Ferdinand Piech.
Gosh what a bunch of Buffoons…Like Bolsheviks…And that website reads like 1980s Pravda…Are Gettelfinger/Graham descendants of Lenin? They should consider growing up now.
“As Sean McAlinden from the Center for Automotive Research said, “What’s at risk here are the core values of the union.””
Now THATS hilarious!!!
50merc:
if people were buying these cars, there would be no problem. No one is buying the cars. Its not because of legacy costs. Its because no one is buying the cars.
jerseydevil:
I sympathize with your predicament. I too like “fuel-efficient hatchback cars,” so the domestics have been ignoring me, too. But here’s why: the 2.5 are the highest-cost producers. A big reason for that is legacy costs. They can’t make in the US cars in the Civic-to-Camry price range and sell them at a profit. If the Fusion wasn’t made in Mexico, Ford probably would lose money on it. (They might anyway!)
When the UAW was born, the idea was “demand more.” If the leadership can only say “we have to accept what the company can afford,” what’s the point in paying union dues? Nor is socialized medicine a panacea: if GM/F/DC stops paying a thousand a month for your health benefits, guess who will?
Old information, yet still relevant…
From:(http://www.findarticles.com/p/articles/mi_m1316/is_v18/ai_4330758/pg_1)
– Washington Monthly, July-August 1986)
“Americans can build good cars; they’re doing it in Marysville, Ohio”
“No collar capitalism: [The plant] office, which is one huge, unpartitioned room full of desks, file cabinets, and computer terminals. The president’s desk…simply sits in one corner, next to a number of others. Everyone was in the same white uniform with his or her first name embroidered on it. No suits and no ties. There are no personal secretaries for the managers. If they are at their desks, they answer their own phones; if not, whoever is nearby takes a message.”
[E]veryone parking where he pleases in the lot…everyone eating in the same cafeteria, everyone going by his first name.
Unions, Japan:
“The Honda plants in Japan are all unionized, though the union is only for the company, not industry-wide. [A] senior vice president, says the difference between Japanese and American unions is one of “sentiment.’ “Japanese unions,’ he says, “think first of what is good for the company, then of what is good for the union.\'”
Honda’s is not perfect…
Unions, U.S.:
“There seems to be an unspoken fear among those in [Honda] management that if the employees [in Honda’s U.S. plants] choose the U.A.W., with its history of often bitter management-labor relations, that same kind of adversarial relationship will follow and kill their productivity.”
“While most workers agree the U.A.W. drive is dead for now, they say the need for some representation remains. “I’m the first to admit there’s been a lot of union abuse in the past,’ says Ted. “But I get a little wary of nothing but praise and good press about Honda.”
“Yet even the strongest unionizers appreciate Honda’s approach. “It’s good that you can talk to the vice president and call him by his first name,’ says Randy Neighbarger, who calls himself the top union organizer in the plant. “And the productivity concepts are good if they’re actually carried out. The teamwork philosophy is good. – It’s not a bad place to work. I’m planning on staying. I just plan on changing them a little bit.\'”
Again, from 1986, but little of this has changed.
Jerseydevil – there’s the rub – the UAW has forced the big 2.5 to maintain crazy benefits and pensions for retirees that they cannot afford to keep paying out with the current sales issues at hand. Obviously this raises their monthly costs, and in the face of shrinking market share, they start bleeding profusely.
The non-UAW companies don’t have this problem right now. If they start losing market share, they can shut down plants and lay people off to reduce their monthly costs, thereby still making a profit or breaking even – they are not on the hook to pay out pensions or health care just like the rest of the modern business world.
Plain and simple fact of the matter is the UAW, through contract negotiations over the years, have forced Detroit into the financial bind they are in and if they don’t wake up and realize this soon both the big 2.5 and the UAW are not going to exist anymore.
You have a point about product, but the respective companies are not able to cut costs as rapidly as they should be able to due to the UAW.
Fear not the Iranian stranglehold on fuel prices.
The scenario that they will shut down the straight is not likely. They depend on oil revenues to survive. If they shut down the straight, the US can shut down almost all their imports and exports. The people would rebel in short order, and the leaders would be hung.
Ain’t gonna happen. They may flex their muscles, and even sink a boat or two, but they will not actually close down strait.
Jerseydevil hit it right on the nose once again: “I cannot buy domestic products because there is nothing for me to buy. I like very small, high end, zippy, fuel efficient hatchback cars, not large SUV’s, trucks, sedans or coupes. The domestics have ignored me for a long time now.”
Detroit’s problem, more than anything else, is lack of desirable product. I’m in exactly the same spot as jerseydevil (except that I’ll take a nice coupe).
Here’s the truth: If there really is a $1500 price penalty on domestic vehicles versus comparable foreign car and trucks because of legacy costs I’m prepared to pay it – if I really want the car. I own a Ford Ranger now and it’s great. But I have no idea what I’ll buy next.
But I realize that $1500 question prompts a different answer from many other vehicle buyers. And that’s why nationalized health care, despite the bleatings about socialism from some on these boards, would indeed go a long way toward boosting U.S. competitiveness. It would also go a long way toward preserving a civilized society in the U.S. This is an argument that can take up a complete string by itself. Maybe TTAC should do an editorial on the subject.
I’m willing to bet cash money, simply because we’ve been able to witness the efficiency of Medicare over the past 40 years, that nationalized health care would be cheaper and a better value than what’s being peddled by the HMOs.
Despite my rantings in this post, I am not necessary a union apologist. And if it comes down to a showdown between the UAW and the Big 2.5, it’s going to be hard for the union to garner any public support when most of the U.S. population doesn’t enjoy anything resembling the perks enjoyed by autoworkers.
And one final related note: Someone brought up the German automakers. I’m here to tell you that Germany’s unionized autoworkers have no idea the shock that awaits them as the effects of globalism finally begin to be felt in their country. A 28-hour work week? They’ve got to be kidding. Unionized U.S. workers are slave labor in Haiti and China by comparison. The jobs are already beginning to move out of Germany to Eastern Europe and elsewhere. They haven’t seen anything yet.
There’s no inherent union mentality. I’m in construction, and some of our proudest union members do their best to outdo their coworkers every day. But maybe that’s the thing, that they’re proud. I met many “socialists” when I lived in Spain (socialist by the original definitions of the word) and their mentality was that hard workers should be proud enough of what they do to demand just rewards… a mentality that the UAW seems to have long lost.
But a lot of this is a PR war, and the manufacturers have really hurt themselves by rewarding upper management failure so copiously. THAT has made resisting concessions a matter of honor for the UAW. There’s no feeling among the union members that the managers are doing their part to save their companies… and I can see their point.
Whatever your “political philosophy” (and really who gives a damn) the point is that rising healthcare costs have become a competitive disadvantage to the US economy. There’s no ideal solution and noone in DC with the balls to do anything about it so you can look forward to living beside (or more likely driving past) more people who can’t afford basic healthcare like vaccinations for their kids. And yeah Germany, Japan and every other country faces the same pressures of globalisation. That doesn’t mean that there is nothing to be gained from taking a look overseas every now and then to see what we might learn from how they do things.
1. While healthcare is a bear: Average annual growth in health care spending is expected to hold steady at 6.9 percent from 2006 through 2016. Even so, health spending is expected to double from $2.1 trillion in ‘06 to more than $4 trillion in 2016, consuming 20 cents of every dollar spent. Since 2000, workers’ health insurance premiums have risen 84 percent, while wages have increased 20 percent, and inflation has risen 18 percent.
2. It is still a fundamentally a management issue: Who runs the companies that can’t seem to design, sell (or support), high-quality cars that the mass-market finds desirable?
If you ask you supervisor for a 3-hour daily lunchtime, and he or she agrees, who’s at fault for the productivity loss? Are your global competitors doing the same thing(s)?
In terms of the 1973 (and subsequent) gas-price/supply shocks in the U.S., exactly who is responsible for maintaining a corporate memory? To learn from the past, and formulate long-term planning accordingly, those leading the corporation must be held accountable.
Some interesting views for sure.As a 35yr year UAW/CAW member I don’t think my thoughts will go over so well today.What it comes down to is that none of us can predict the future.
I think a lot folks are gonna be suprised maybe shocked at the outcome of all this.
More from Gettelfinger, including the “s-word”:
http://www.msnbc.msn.com/id/17815093/
The UAW’s true position, or true positioning?
‘what would happen to the generous wages and benefits offered by the transplants to their workers? ‘
They would disappear, just like they do for the countless other people who get laid off when their employers go toes up? It’s a shame, and I feel sorry for people in that position, but I also don’t think that people who build cars should be immune to the business cycles that everyone else has to contend with.
I worked at a UAW shop first job out of college and when the company went into red from a economic slowdown, the UAW did the most logical thing…Went on strike for higher wages. The “s-word” thing would be really funny. Needless to say, I have never owned a 2.625 product.
Mikey, your thoughts as an “in the trenches” insider are always welcome. And you’re right that no one can be certain about the future.
My fear is that the UAW/CAW has become so accustomed (and encouraged) to be short-sighted that only a collapse can change attitudes. This, of course, is also the case with management — nobody has been worse at considering long-term consequences, taking fortunes for themselves while neglecting the future. I think that’s a basic theme of Mr. Farago; that the real tragedy of the Big Three was a failure to adapt to a new economic world.
Many of the posts above make reference to the mentality,or lack of on the shop floor.
While I hafta agree we don’t have many phds,we do have some well educated and inteligent people,
that do read a newspaper and stay informed.
It was mentioned above that some of the plant people think that the big 3 problems are all a corporate plan voo doo economics was the quote.
I’m fortunate that I’m not tied to the line.My job takes me through a lot of areas of the plant.
I pride myself on being pretty well informed.I am painfully aware of the situation in the domestic auto industry.
Its easy to understand how that those less informed might get the idea that GM was making it all up.
Why would I say someting like that?Lets see on my drive in I see construction going on to a 5yr old building 15 or 20 hard hats working away.
In the course of the day I might see 5 middle management people doing the work of one.
Expensive machinery sitting idle,it broke, somebody forgot to order a part.
At least 2 maybe 3 white collar workers that have been placed on a job,where they can do the least amount of damage.I’m not making this up.GM does not know what to do with them.
Machines that don’t work, expensive “flavor of the month projects”massive empires to feed some upper middle managements ego.The list goes on and on.
I ask myself how can this be a company that loses money on every car it sells?
As I said I KNOW! that GM is in deep poo poo.
but you try and convey that to my not so well informed co worker. I didn’t say stupid I said not well informed.
I can only hope some folks reading this won’t judge my mind by the color of my collar.
Michael
Management has its problems. Sometimes I think we should be out of business. That said, there are issues the big 2.5 have to deal with the competition does not.
Legacy costs: whoever decided defined benefit plans were a good idea should be shot. Companies come and go with time; the big companies in 1950 were the railroads, in 1900 carriage makers. Tying ones retirement to a company’s long term solvency was stupid. We all know this now, no new companies offer defined benefits, but the government is still trying to save this system, and the big 2.5 are stuck with 100,000s of retirees.
Legacy cost again: in WW-II the auto companies had a labor shortage but there were wage controls. In order to create demand for jobs the auto companies offered health benefits to get around the wage controls. The government winked so as to get guns and ammo. The unions expanded these benefits. Health care costs exploded due to new treatments. Now the big 2.5 pays health care for 100,000s of workers and retirees.
Health care again. Ever wonder how uninsured and indigents get health care in the U.S? Well it is free or heavily subsidized in nearly every hospital, sort of an unofficial national health care system. Who pays? Well those who have insurance or their employers. If the big 2.5 have many more people getting health care, including 100,000s of retirees, then they are paying a disproportionate share of the unofficial national health care bill compared to the Japs. There is a short term and a long term solution to this competitive disadvantage to the big 2.5. Short term, refund the bill to the big 2.5 from the national treasury; call it the “level manufacturing playing field w.r.t. health care costs act”. We’re talking billions here, by the way. That is, the (forced) charitable component of the big 2.5s health care bill is huge. Long term, and this is a Reagan Republican speaking, national health care. I hate the thought but studies show we are paying more than the rest of the western world and not getting much if anything for it, so let it be. This will go a long way to leveling the playing field between U.S. manufacturing and the rest of the world nad my short term fix above will never fly due to the anti-big 2.5 sentiment in this country.
CAFÉ (Corporate Average Fuel Economy). This law, in existence since the 1970s, says a company must average a certain MPG for their sales weighted car fleet. A different standard applies to light trucks. This law has a disproportionate affect on the big 2.5, and it explains a lot of the big 2.5s problems.
First, physics tells us that big cars and trucks get lower fuel economy (F=MA, where Force in a car is the force at the wheels which comes from gas. M is the mass of the vehicles. All the inventions in engine and trans efficiency in the last 30 years, including hybrids, only nibbled at this basic formula.
The big 2.5 were coming from a fleet and customer base biased toward big cars and trucks. The Japs from a base and customer base of small cars. The big 2.5 had to spend billions to meet the law, the Japs did not.
Some say if we “listened” to the CAFÉ law, and its proponents, we would not be in the mess we are in. Maybe true for the last year or two, but for the prior 28 the big 2.5 maximized their profit by “just” meeting. CAFÉ. In reality we lost out on profits by not being able to sell the customer what he wanted. We inflated the cost of big cars to lower demand and sold small cars at a loss of 1000s each to meet this law. The cars we did sell have 100s of dollars of fuel saving technology that the customer will never get a return on. All of this while simply trying to sell to our strength to meet customer demand. The Japs did not have to do any of this because their base was in small cars.
What did the Japs do with this windfall? Stole our market for one. They were able to use this cost advantage, and the legact costs, and the better labor attitude, to sell a better quality car for equal or lower price. There is not secret to quality; it costs money…and the big 2.5 had 1000s less to work with. And now what are the Japs doing? Building big cars and now going for the truck market. They have CAFÉ credits from their years of small cars that will allow them to exceed CAFÉ laws for years and steal that market. Thank you U.S. government for helping kill the U.S. auto industry. By the way, the other way to do this, which is done everywhere else in the western world, is by gasoline taxes. But the spineless U.S. government would rather use the CAFÉ blunt instrument, and hide the tax in the auto company’s sales prices. Killing the big 2.5 as collateral damage. The big 2.5 has always advocated the high gas tax method. Not because we want to kill our large car market, but because at least this would be a level playing field.
Not convinced. Try this analogy. Would it make sense to ask Mack Trucks to meet the CAFÉ standards? Of course not. Yet some big 2.5 company’s has always made ½ or more of its sales, and a higher percent of its profits, on trucks, so why was it fair to apply the same standard to that company as to the Jap company that made small cars?
One other item. I keep seeing it mentioned that the big 2.5 “gave” the unions their work rules, benefits, etc. Yes, like you give a thief you wallet with a pistol stuck down your throat.
Enough for now.
I have to echo you’re sentiments Mikey.If the majority of this board knew the talent involved with skill trades at some plants,it would baffel them.Some folks posts are really funny as the re-count their past experience doing some type of function in a plant that has UAW employees.
I have to believe most of these stories are from the past,say 15 to 20 years.Take my word for it,thats not the case anymore.
Mikey,you may agree with me about this.Team concept–or team build as many in assembly are used to hearing.This is a process which Toyota & Honda employeed at the begining of their American operations.Its now widely employeed in G.M. facalities.Its been tweaked,but the main emphasis is takin straight from the book “Toyota team process & Quality.”Its actually a good read and by all indications its working quite well in the plant I’m at.
Some people in the union ( UAW ) feel this process is a waste of time.You’ll find that at any place of employement,when change is needed there are those that dissent.Much more quietly in a Non-union place I’ll agree,but many at G.M. know that change is needed.The parameters at which we do our jobs are radically different the those procedures we employeed just a few years ago.Indications on quality and through-put are in the positive or green if you will.theres still a hell of a long way to go I’ll admit,but I think we have some time left hopefully to right the wrongs & get on with it.
One thing I’d like to point out is that many here are quick to included outdated stereotypes about union people in a factory setting.Some include the “1 to 2 hour lunch break” or “thats not my job get someone else”.The best is someone saying above,” they quit 1 hour early to clean-up & wait in line to clock out.”
If these practices are still continuing,then shame on managment for allowing it to carry on.More shame should be placed on the shoulders of the union person for doing these things.The #1 thing all union people should do is be as effective as possible at the task at hand.This in essence is justifying ones worth at the workplace & showing self-pride behind that which you produce.
I’ve had to in the past represent employees for being late to a particular area or line,arguments over demarcation,habitual abseenteism.If their at fault,red-handed guilty,expect me not to jump down managments throat.The did their job enforcing the plant regulations and the employee in these instances failed to live up to their terms of employement.
As I said before,its going to be a fight for survival.A fight that many in G.M. can see & feel already.Its time for the slackers to move out of the way or get run-over.Rant-over.
Your babbling District Committeeman
UAW,local 549
Mike Frederick
Yeah Mike F we have agreed to GMS and team concept as part of our concession package,to get the Camaro.
Will it work?If the Silverado is any indication
yeah its gonna work.
Its gonna be the toughest negotiations ever.Neither side will come away happy but ya can giter done, without a strike.
Good luck from your brothers and sisters up north. LOCAL 222
“The Georgetown Toyota workers earning more than the unionized big three should send a clear message to the union that your employer’s sustained profit can benefit all workers.”
— labrat
Don’t the asian manufacturers match or pay over the Union rate to keep the union at bay?
Those workers (the non-union at the honda, toyota, huynday factories) will not earn a pension and will not get healthcare insurance after they retired, so they are not getting the same deal as the UAW workers (and they may not realize it)
But it seems clear that without UAW pays as a standard, everyone in the industry would earn lower wages.
And in this twisted opposition, both parties are evil. It just happens that the UAW was a little more succesful at convincing the manufacturers last time they sat at the table, but if there was no UAW, everyone would be making $7/hour, no paid vacation, no health care. It does not take a lot more skills to tighten a hexnut than to flip burger at McDonalds *
* Not my opinion, this is what the fancy pants MBA upper management thinks. I’m a computer analyst/programmer and that is my boss’s opinion. I can’t imagine what they think of mechanics.
“…if there was no UAW, everyone would be making $7/hour …”
I don’t buy that argument. Intel’s factory employees in their US plants are paid very well have health benefits, profit sharing, 401k plans and the like. Of course many of those employees have gotten at least an associates degree and don’t believe they have a right to their job. I worker my entire career in the US electronics industry and was well paid without a union in sight. Union apologists cling to the notion that the unions benefit everyone, but the facts are not clearly on their side at all.
Higher pay without higher productivity only produces inflation in the long run anyhow. Perhaps the union apologists need to study macro and micro economics a bit more.
News is coming out on the first day of the convention:
http://news.yahoo.com/s/ap/20070327/ap_on_bi_ge/uaw_contract_talks_19
“In a speech at the start of the two-day national bargaining convention in downtown Detroit, Gettelfinger said the union will fight companies at the bargaining table, in politics and “if need be on the picket line.””
I wonder if this is just bluster. The whole idea that the nature of employer:employee relations is as a fight between opposing sides is wrong at it’s root. Unfortunately most people, MBAs included, have been taught and believe this harmful paradigm.
Maybe I’m imagining things, but a few neurons are bouncing around the idea that sometime in the 1990s the UAW went to Ford for a Pattern Contract (instead of GM, the normal party). Ford, then having fewer older workers due to more recently laying off a large number of people, tried to screw GM by agreeing to larger retirement benefits.
At least, that’s what the neurons keep saying, and if so then I fail to see how the UAW can solely accept so much responsibility. In this, and other ways (Mullaly’s Family Gulfstream, anyone?) there seems to be a disconnect between short- and long-term interest in Detroit. If management is going to ask the UAW to choose long-term interest over short-term interest then there’s a precondition that management do likewise (that may not be sufficient, but it reasonably seems necessary). When management conspicuously chooses short-term interest then bashing the UAW seems beside the point. If management isn’t focused on long-term interest then the UAW would be foolish to give up members’ short-term interest.
Mr jthorner
I probably was not clear in my original post. And I don’t really want to be perceived as a union apologist (ouch). My point is that supply and demand applies to the job market. Building cars is mostly unqualified jobs, with a lot more people willing than positions to fill (see how many apply for each position in a factory) and without unions those jobs would be $7/hour. I’m not saying this is a good or bad thing, this is just a fact.
Look at other industries, facing external pressure, that had to either die (steel) or accept cutbacks (airlines). The auto industry is certainly headed that way.
Non-union shops in the auto industry do match the union rates, as an argument that “you don’t need to be organized to make a decent living” which is a pretty specious statement since indeed, those non union workers wages are carefully matched with union wages.
“The whole idea that the nature of employer:employee relations is as a fight between opposing sides is wrong at it’s root. Unfortunately most people, MBAs included, have been taught and believe this harmful paradigm.”
Absolutely! And dont get me started on people who “earned” a college degree in “Labor Relations”. Ask yourself, who promotes this white/blue collar garbage. This Us vs. Them crap. This is sooo 1917 Soviet Union/Bolshevik junk.
“Many of the posts above make reference to the mentality,or lack of on the shop floor.
While I hafta agree we don’t have many phds,we do have some well educated and inteligent people”
The UAW shop I worked at, the UAW rank-and-file members were very bright/competent. The UAW plant manager turned out to be a good friend since he was in my face constantly for, um, “Rules Violations”. We would party and hunt (sometimes simultaneously and in that order) on the weekends and he would be in my face on Monday for something I was not “allowed” to do. When the company went in the red most UAW people understood the concept of “loosing money” (since so many owned a 2.625 car :)) and knew what really needed to be done to get back to black. The problem was… The local UAW leadership started rallying the troops sorta speak with talk of “Fight for what we deserve” “Solidarity” Fight.Fight.Fight.Fight…Everything was some kinda freakin Fight. The word Fight is envolked to collect peoples minds and make them stop thinking, fall-in and play “follow the leader”. The maggots in DC use this word/mindscrew often as well. Count how many times Gettelfinger et al envoke the word Fight in the next few months. It still amazes me to this day that otherwise intelligent people would act like a mob of idiots when told to act that way by the “Leadership”. Everything that is “bad” thru-out human history can be attributed to a mob that played “Follow the Leader”. The UAW leadership does not have the rank-and-file’s best interests at heart… They are being duped.
The reason Toyota plants pay as well as the Big 2.5 is so they can compete against their own plant in California where Toyota Corollas and Tacomas are produced by UAW labor. If Toyota didn’t pay well, it gives the workers a reason to organize to match the pay of the California Toyota plant.
Its interesting to note that in these kinds of discussions, no one ever mentions how Toyota Corollas and Tacomas are assembled by UAW labor……
“It’s the union’s fault!!” is a mantra that’s repeated over and over when cars don’t sell. The workers ASSEMBLE the cars, they don’t design and market them. The very fact that Toyota Corollas and Tacomas sell very well and are supremely reliable demonstrate that it’s management’s fault, not the UAW. The union is just there to negotiate a fair contract that affords the workers a good living for their hard labor. Its’ difficult and dangerous work and the workers deserve EVERY penny.
And the pay is hardly making anyone rich. They don’t wear Diesel, they wear Levis. The pay at an auto plant affords the workers a decent middle class life. They make rent and send their kids to college. It’s good for the economy. Its good for society.
A quote from http://soldiersofsolidarity.com/: “Workers Rights are not defined by Law or Contract. Workers Rights are defined by Struggle. You will Win what you are willing to Fight for.”
“Fight” and “Struggle” (i.e. % “) and not “Contracts”?. And what about economic Freedom?.
Any self-respecting businessman would fire instantly the guys writing this kind of stuff.
Moreover: I think that it is UN-American to buy stuff produced by guys who write that. I say it seriously, and I am not American.
Spanish guy:
If there is no union, you can be fired for any reason (or NO reason) at ANY time.
Sorry, change the “%” for “Force”.
In Europe (and Canada) socialized medical care and pensions mean that the entire cost of maintaining an army of retirees doesn’t fall on the corporation that employed them
Yup, you are right: It falls on the European States, and the whole d****d pyramidal scheme is based on high birth rates, gone in Europe since the 1960´s-70´s.
Think in Europe as a still bigger GM, making promises that can not keep in the future. The European retirement and healthcare meltdown will be BIG. Massive immigration is only postponing (and making worse) the unavoidable day of reckoning.
There´s a simple principle forgotten in this “socialized medicine” scam: That can not be paid for individually can not be paid for collectively.
But, OTOH, s also want to believe in their own Santa Claus, and it is called the State (in Europe) or the employer (in the USA).
There is no reason for the State (or the employer) paying for your education, your healthcare, your housing, your food or your recreation. The State or the employer can only “give” you what you gave them in the first place. People forgetting this principle always has to pay on the long run.
I find it baffling that people stand by the “If the UAW shops weren’t around pay would be less at company x, y, or z”.
Look at your local economies. I can tell you factually in Central Ohio that companies compete on wages to keep good people. This includes restaurants – McD’s pays over $8 an hour due to the labor competition. This is true anywhere – most labor in the area is non-Union to boot.
It all boils down to competition in an area for labor.
As far as the Cafe standards are concerned, the Asians and Europeans have been working on technologies to make their engines more fuel efficient for years due to the high prices of fuel in the respective countries. The US has had it easy for years compared to the rest of the world when it comes to gasoline costs. The US automakers are now in a catch-up mode because they felt what the had was good enough and no one was complaining. This definitely falls on management to push the envelope, but then you have all those union-line contracts to prevent things from changing in a timely manner. One person said it best with the concessions they had to make to get to make the Camaro. The fact that concessions had to be made speaks volumes of the problems with organized labor and why the big 2.5 cannot win in a market where their competitors don’t have these restraints in a constantly evolving marketplace and economy.
Jersey Devil: welcome to the rest of the real world. There is one answer to that one – do your best work, help the company to make a profit and not a loss, and you will be safe. They don’t owe you a job.
I could lose my job at any time. I can also walk out anytime I want. I like it that way. I know that at the end of the day, as long as I have done my job and help to make sure the company is running well I am safe.
At the same time, if I see red flags on the company’s health I can leave at any time and find another similar paying position.
If there is no union, you can be fired for any reason (or NO reason) at ANY time.
Yes, with no pesky labor laws interfering you can be fired any time. And this is a GOOD thing:
You can walk away from the deal with your employer any time. You are not his/her slave.
The employer is neither your slave. He/she should also be able to walk away anytime, for whatever reason.
And believe me, if you are fired, there´s a good reason in the mind of the employer.
Consumers also have the right to “fire” the employer anytime for any reason refusing to buy his/her product. Economics is a continuous process of creation and destruction. Try to freeze that process and you´ll end in a Soviet Union redux.
I think that the transplants are able to pay comparable wages/benefits to the UAW is that without the stringent union rules for who does what/when/how that the workers can be more productive. Yes, that means that they work harder than their UAW counterparts, but that’s the way of the world right now. And they’ll have to keep improving to keep their jobs here, as globalization chips away at the slight geographic advantage of a plant on “home” soil.
Spanish guy said And believe me, if you are fired, there´s a good reason in the mind of the employer.
sometimes yes. sometimes no. i was fired once because i innocently found out about my bosses affair with one of the companies suppliers wives.
Orian,
I think you are mistaken. A UAW worker will not be kept in a layoff because he is the best worker. They do things differently as I understand it. To avoid being fired is merely a matter of meeting a standard.
Jersey,
The reasons for firing are many and varied, but not all of them are good. Often enough, the guy doing the firing knows his reasoning is not good.
Still, you are correct about the rest. A truly free market removes the stigma from losing a job and let’s both employers and employees shuffle around until they find the best fit. This is best for everyone except people with real problems who then can’t stick anywhere.
I have been fired from several jobs, and always found a better one for more pay. I have never been fired from a job where I was happy, so I tell people not to sweat it.
OTOH, I was laid off once, and that was a nightmare because the market for my skills was then flooded and I had to change industries to find a job.
I guess I should have addressed Spanish for that last one.
i was fired once because i ly found out about my bosses affair with one of the companies suppliers wives
I am sorry for your misfortune.
But even in that case he had a (bad) reason to fire you: To hide his dishonesty.
Suppose you win lotto a month before being fired, and you quit your job. Did you have a right to quit your job?. Absolutely. The same for your boss: He also had a right to quit and fire you, for a reason as casual as your winning lotto ticket: To hide an affair.
Nevertheless, the employer who engages in this kind of irrational firing is nailing his/her own coffin as a businessman, because too high employee turnover is bad for business: That´s the reason Henry Ford raised wages to a (then) unheard 5$ a week (see http://en.wikipedia.org/wiki/Henry_Ford#Ford.27s_labor_philosophy Yeah, Wikipedia is crap, but this is true).
OTOH, we are talking about property owned by other people, and people has a right to use his/her property irrationally, as long as they pay the price of that behaviour.
As conscience humans, we have an inalienable right to self-ownership and by extension, earned property. The jobs I create are my property and I can choose to dispose of them however I choose. I extend these same rights to all others because I am a moral man that does not wish to be labeled a hypocrite. If I reserve these rights for myself and deny them to others, that would make me just a common thief/slavemaster.
If anyone claims entitlement to any aspect of another persons life, that makes them a thief whether it be a spouse or a criminal gang that calls themselves “Government” or the #^$& that stole my garden hose last night…Arg.
Hmmm….
http://money.cnn.com/2007/03/28/news/companies/uaw_contract.reut/index.htm?postversion=2007032815
mike_i_n_mich has probably the most level-headed, accurate portrayal of the current situation in the US auto industry I’ve ever read on this site, and gets nary a comment. Where are the rebuttals from all of you? They are conspicuous in their absence.
I for one will say that I agree with him 100%.
# Spanish guy:
March 28th, 2007 at 9:46 am
Sorry, change the “%” for “Force”.
In Europe (and Canada) socialized medical care and pensions mean that the entire cost of maintaining an army of retirees doesn’t fall on the corporation that employed them
Yup, you are right: It falls on the European States, and the whole d****d pyramidal scheme is based on high birth rates, gone in Europe since the 1960´s-70´s.
Think in Europe as a still bigger GM, making promises that can not keep in the future. The European retirement and healthcare meltdown will be BIG. Massive immigration is only postponing (and making worse) the unavoidable day of reckoning.
There´s a simple principle forgotten in this “socialized medicine” scam: That can not be paid for individually can not be paid for collectively.
But, OTOH, s also want to believe in their own Santa Claus, and it is called the State (in Europe) or the employer (in the USA).
There is no reason for the State (or the employer) paying for your education, your healthcare, your housing, your food or your recreation. The State or the employer can only “give” you what you gave them in the first place. People forgetting this principle always has to pay on the long run.
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This has to be by far the most intelligent and insightful comment I have seen here in a long time. He captures in a couple of paragraphs the whole fallacy of government thru socialist policies giving us something for “free” and the damage it eventually does, even if that damage is only to make us less self reliant. There will always be a day of reckoning. Kudos to you sir!
I second that. Spanish Guy is more American than a lot of Americans. He studied Austrian School Economics I assume.
Also thanks mike_i_n_mich for your insights as well. A good analogy for GM/UAW negotiations is “Lets negotiate how much you are going to pay me to mow your lawn as I point a gun to your head”. Gettelfinger called Delphi’s offer “stupid”. I think that means he’s getting ready to pull the trigger.
I agree, the post by mike_i_n_mich had great insight.
Guest columnist perhaps?
Unions, they are the cause of all evil in this country. $75 and hour plus benifits to do what? I hope the government doesn’t give a dime to these companies and I hope we break every union in the country and start being sensible about how we do work and how we are compansated. Unions are KILLING our country!