Auto Bailout Bill: Dead

[nando]

it is true that the timing for this is not good. Delaying the inevitable may be the best choice. Some analysts are expecting 9% unemployment by the end of next year - I don't know if that factors in the potential fallout from a collapsed US auto industry, but if it doesn't, it doesn't look too good for the recovery.

However look at the market today. It was up about 2% despite the failed bailout effort. I think that means they are expecting something to be done before it's too late. Of course if they are wrong we could be in for another huge drop.

I don't like our auto industry - they've consistently made poor decisions and have been struggling for a long time. But I don't think now is the time to lynch them. For the same reason people don't understand the need for bailing out large financial institutions, people don't understand why this needs to happen. It's just too bad the UAW wouldn't give them a little room. Their stubborness could be their own undoing.

[gstuning]

Will they not be bought?
By possibly the other auto manufacturers. Or are the debts so bad that it´s impossible to actually get out ?

[Jand3rson]

We haven't had anything resembling a "free market" economy in 80+ years, that ship has long since sailed, and it's not coming back. Americans don't want it, the government doesn't want it, and frankly the "free market" doesn't want it. Arguing semantics and stupid textbook examples is pointless. The economy does not exist in a vacuum.

I'm not a "conservative", I'm a realist. The world isn't like Econ 201. Letting a major backbone of our consumer based economy crumble in the midst of a huge financial meltdown is suicide. The 18-30 billion that they're asking for as a lifeline is chump changed compared to the fallout of a massive unemployment bomb. Saying "fuck it, burn it all down" might appeal to the mouthbreathers & Paultards, but at the end of the day, it's a pretty shitty solution.

-Charlie

After doing a bit of reading here, I'm starting to agree.

[Charlie]

Even if they get a bail out, it's only going to delay the inevitable. At LEAST one of these companies is not going to make it through this downturn. My bet is Chrysler, but GM has much higher legacy costs so it may actually go first. If Ford can survive, I think they will actually benefit in the long term.

No argument there. Chrysler is gone regardless, the writing was on the wall 2 years ago when they were purchased by that cancer Cerberus. That organization serves to do nothing more than gut & firesell. The general buzz is that they will be absorbed by GM.

-Charlie

[Charlie]

I don't understand you, Charlie. You are a conservative, right, who believes in the free market economy?

We haven't had anything resembling a "free market" economy in 80+ years, that ship has long since sailed, and it's not coming back. Americans don't want it, the government doesn't want it, and frankly the "free market" doesn't want it. Arguing semantics and stupid textbook examples is pointless. The economy does not exist in a vacuum.

I'm not a "conservative", I'm a realist. The world isn't like Econ 201. Letting a major backbone of our consumer based economy crumble in the midst of a huge financial meltdown is suicide. The 18-30 billion that they're asking for as a lifeline is chump changed compared to the fallout of a massive unemployment bomb. Saying "fuck it, burn it all down" might appeal to the mouthbreathers & Paultards, but at the end of the day, it's a pretty shitty solution.

-Charlie

[E30 Wagen]

I don't understand you, Charlie. You are a conservative, right, who believes in the free market economy?

Well, the big three are falling behind. They allowed themselves to be bullied by the UAW, and they keep designing and producing vehicles with superficial appeal or are all together impractical. So, their sales are down.

So, do you support a bail out or not? Just because these companies are huge and thousands of jobs will be lost doesn't mean they deserve a bail out. They are failing at generating income, so too fucking bad. Time to start over. If they get a bail out, then why doesn't every other business in the U.S. deserve a bail out if they go under? Are you willing to shell out your hard earned money to the big three? Are you that confident that they are going to turn over a new leaf and make their business profitable once more?

You're being quite a know-it-all in this thread. So, what do you propose we do? Argue over the details of how much a UAW worker earns and figure out what the real problem is? Well, I think it's quite obvious that the real problem is not so much related to the UAW as it is to the unwanted cars that the big three are producing.

[Charlie]

Charlie, the first quote was made while I was finding mine form a past thread. They get to highlight the abuse of UAW on the companies' economics. And I am sorry for having noted that employees cost $100k per year. I was wrong. It's $133k per year.

The point is that if the US car companies want to pursue business, they need to have a little monetary discussion with their employees, with or over UAW. And I think it is exactly what the southern senators required yesterday. Salaries and other conditions at par with the US-based Asian car manufacturers.

Lee, that's the thing. Modern era UAW guys are getting paid what their non-union counterparts make. They've got the same level of benefits. It's the guys that signed up in the 60's that get the huge pensions & bene plans. Asking them to take a huge pay cut for what their grandfathers got is literally crucifying the son for the sins of the father.

Remember, there's been a huge number of layoffs & buyouts over the past 5 years at all 3 of the detroit manufacturers. The workforce has shrunk significantly. The proverbial 25 year seniority guy is gone. The Modern guy is really no different than what Toyo & Honda have right now. People can't seem to understand that.

-Charlie

[Massive Lee]

Charlie, the first quote was made while I was finding mine form a past thread. They get to highlight the abuse of UAW on the companies' economics. And I am sorry for having noted that employees cost $100k per year. I was wrong. It's $133k per year.

The point is that if the US car companies want to pursue business, they need to have a little monetary discussion with their employees, with or over UAW. And I think it is exactly what the southern senators required yesterday. Salaries and other conditions at par with the US-based Asian car manufacturers.

[Charlie]

Quoted for this forum. Which is a quote from an article.

"He explained that in 2006, widely available industry and Labor Department statistics placed the average labor cost for UAW-represented workers at the former DaimlerChrysler at $75.86 per hour. For Ford it was $70.51, he said, and for General Motors it was $73.26.

“That includes the hourly pay, plus the benefits they’re receiving and all the other costs to General Motors, Ford and Chrysler, including legacy costs – retirement costs, pensions, and so on – so it’s looking at the total labor costs per hour worked for workers,” Perry said.

For U.S. workers at Toyota, however, the per hour labor cost is around $47.60, around $43 for Honda and around $42 for Nissan, Perry added, for an average of around $44.

“So we’re looking at somewhere around a $29 per hour pay gap between the Big Three and the foreign transplants that are producing cars in the United States,” Perry, chairman of the economics department."

Simple maths show that an employee costing hourly GM the sum of $73.26 and working 35 hours per week x 52 weeks = $133,333usd

And also.
http://www.detnews.com/2005/autosins...A01-351179.htm

Lee, how is that different than the quote 2 posts above yours?

GM says its total hourly labor costs are now $69 including wages, pensions and health care for active workers, plus the pension and health care costs of more than 432,000 retirees and spouses. Toyota says its total costs are around $48. The Japanese automaker has far fewer retirees and its pension and health care benefits are not as rich as those paid to UAW workers.

I'm not sure if you're intentionally being obtuse, or you just don't posess the ability to grasp simple concepts. The current employees aren't what's bankrupting the company, it's the legacy costs. They have 15x as many retirees to support. You don't actually think that employee sees the 133k, do you?

-Charlie

[Massive Lee]

Quoted for this forum. Which is a quote from an article.

"He explained that in 2006, widely available industry and Labor Department statistics placed the average labor cost for UAW-represented workers at the former DaimlerChrysler at $75.86 per hour. For Ford it was $70.51, he said, and for General Motors it was $73.26.

“That includes the hourly pay, plus the benefits they’re receiving and all the other costs to General Motors, Ford and Chrysler, including legacy costs – retirement costs, pensions, and so on – so it’s looking at the total labor costs per hour worked for workers,” Perry said.

For U.S. workers at Toyota, however, the per hour labor cost is around $47.60, around $43 for Honda and around $42 for Nissan, Perry added, for an average of around $44.

“So we’re looking at somewhere around a $29 per hour pay gap between the Big Three and the foreign transplants that are producing cars in the United States,” Perry, chairman of the economics department."

Simple maths show that an employee costing hourly GM the sum of $73.26 and working 35 hours per week x 52 weeks = $133,333usd

And also.

http://www.detnews.com/2005/autosinsider/0510/17/A01-351179.htm

[nando]

the UAW hung themselves, that much is obvious. People have seen this coming for YEARS.

Unions were great back in the day when there were no government regulation on employee safety, pay and work hours. Without the government to protect people from exploitation, the unions stepped in. But now that there are so many government regulations on employment unions are basically a relic of the 19th century. They need go go away.

I used to have a union job. the union basically did nothing except collect $50 a month in dues. Our benefits were average at best and basically because all wages were set by the union, once you had reached the top there was no way to get a performance raise.

I now work for an employee owned company without a union - way more money, way better benefits, better future. Good riddance.

Even if they get a bail out, it's only going to delay the inevitable. At LEAST one of these companies is not going to make it through this downturn. My bet is Chrysler, but GM has much higher legacy costs so it may actually go first. If Ford can survive, I think they will actually benefit in the long term.

[hugh jass]

Well, I wonder how come GM employes make 50% more than the ones at Honda or Toyota US plants. The big Three employees cost $14 billion more per year in extra salary and benefit over Honda and Toyota, in the US. Where is the thread from last month about that?

I am 100% for social benefits, medic aid, and pensions, but not to the point of strangling a company when it is obvious low education employees get over paid for basic tasks.

Dude, do your research.

Autoworker wage and benefit differences

By The Associated Press – 18 hours ago

Hourly wages for United Auto Workers laborers at General Motors Corp. factories actually are almost equal to those paid by Toyota Motor Corp. at its older U.S. factories, according to the companies. GM says the average UAW laborer makes $29.78 per hour, while Toyota says it pays about $30 per hour.

The difference is in benefits, with the unionized factories having far higher costs.

GM says its total hourly labor costs are now $69 including wages, pensions and health care for active workers, plus the pension and health care costs of more than 432,000 retirees and spouses. Toyota says its total costs are around $48. The Japanese automaker has far fewer retirees and its pension and health care benefits are not as rich as those paid to UAW workers.

The UAW has not been able to organize workers at a Toyota plant in this country; it does represent workers at one joint GM-Toyota plant in Fremont, Calif.

[Charlie]

That sucking sound you hear is the sound of all that money disappearing in the marketplace. If I was still at Ford, I may have bought that Massive Front and Rear sport brake kit. Now, just can't. There are 3 million plus people out there that are *customers* that are tied to the US auto industry for better or worse.

Bingo.

I'm far from a card-carrying UAW member, but it seems to me that trying to fix a disposable income consumer-based economy by trashing 3 million jobs seems somewhat counterproductive.

18 billion is a drop in the bucket compared to what a massive jobs-creation program is going to cost.

-Charlie

[ed94r]

Another angle:

All these autoworker out there making $60-100K were out there *spending their money*. So all the little donut shops, restaurants, furniture stores, retailers of all types, parts sellers, shop owners, online vendors, etc, benefitted from the churn of money in the marketplace. You make it, you spend it..eventually.

These autoworkers just didn't hoard the money under their mattresses. I'm not just talking about Detroit. You'd be surprised at how many assembly plants, parts plants, modular assembly vendors, suppliers of all tiers and types are scattered through the USA. All middle class wage earners spending their money on middle class stuff.

I worked for FOMOCO in both salary and hourly functions for over 12 years. I spent the money and did my part to help pay other peoples mortgages and business expenses by participating in the economy. I earned it and I spent it. My 24V E30 was bought and paid for with the wages I earned. I may have even bought a thing or 3 on these boards.

That sucking sound you hear is the sound of all that money disappearing in the marketplace. If I was still at Ford, I may have bought that Massive Front and Rear sport brake kit. Now, just can't. There are 3 million plus people out there that are *customers* that are tied to the US auto industry for better or worse.

I'm on the fence about the buyouts..and have an open mind for both sides. I'm not adding this post to argue, just to offer a different view.

Ed

[Farbin Kaiber]

What's killing the Big 3 is the legacy costs of its retired employees. Healthcare, pension, etc. So what do you do there? It's not the 25 year old guy making 16 bucks an hour, it's the 75 year old guy with a bunch of health complications. How do you cut that?

-Charlie

Scheduled Euthanasia?