Google Detroit News Union Bust

 

Here's a poll on the issue from the Detroit News. The responses seem to be running some 3-1 against the union as I post this (of course, that could change).
http://info.detnews.com/autostalk/le...opic=UAWstrike

 

Im with JP on this is not exactly a bad move, no more huge inventories building up on dealer lots, that have to be sold at huge discounts.

 

Unfortunately it is clear that the strike is hurting GM and they are going to have to cave to the demands, which in turn will weaken not only GM but the American auto industry even more, and lower the number of union workers even lower.

I honestly don't understand how unions miss the big picture.

However, the people that work at these plants (Toyota/Honda included) are a big part of middle/upper middle class America. We can argue that they are overpaid, but the fact is, they are a large part of what makes up the middle section of the income scale. So I really don't have a problem with the dollars they make.

BUT what I do have a problem with is them using their powers in numbers to force our ailing American auto manufacturers to pony up a significant portion of their health care bill forever. Health care costs are out of control -that's a fact - and we all need to pay more. But why does the employer have to get stuck with all of it? And why does the employer have to guarantee jobs?

ok rant over...

 

The UAW has got to cut the crap, make some more concessions on
the pension/healthcare front and get back to work. If you add pension
costs to the health care figure (I think they're approximately $700) the
cost per vehicle becomes a 10:1 ratio. Absolutely staggering

Health Care Costs per Vehicle in 2004
Source: 2005 Harbour Report & A.T. Kearny Inc.

GM:
$1,525

Toyota:
$201


Profitability per Vehicle
Source: 2005 Harbour Report

GM:
Loses $2,331 per vehicle

Toyota:
Makes $1,488 per vehicle


http://www.npr.org/news/specials/gmvstoyota/

 

There are a few hot sellers like the Acadia (etc..) if they run out people will just go to a MDX or Highlander or Veracruse or whatever and GM will never see those customers again leading to smaller yet again market share and loss of profitable cars (ie. whatever they can't sell well will have a steep discount).

 

seriously...

as mentioned above, Toyota is working towards building their OWN healthcare provider and providing secure benefits without promising huge sums of money till death...GM seriously needs to get a grip and rethink this thing with the UAW. These costs cannot remain if the company wants to succeed!

 

WOW!! Those are extreme numbers!! GM's got bigger problems than the Union!

How could GM management allow these problems to spiral out of control?

 

That's nothing new. GM has been selling many of its models for years at a discount..............incentives. Except for a few hot-selling, high-demand GM vehicles like the Silverado, Sierra, and the CTS to a lesser extent, incentives are what has kept the company in buisness.

 

The UAW is hastening the death of their golden goose.

But GM won't have to cave in. If the strike goes on and on, the UAW's position actually becomes weaker because GM will want more concessions to help them recover from the damage.

If the UAW goes too far, GM will eventually just declare chapter 11 at some point and be able to rip up all the union contracts.

 

I think that before that happens, you'll see GM selling off some of their non-traditional branches like Saab, Hummer, and Opel.

 

GM, UAW reach tentative deal; strike is off

Sharon Terlep / The Detroit News


General Motors Corp. and the United Auto Workers reached a tentative agreement early this morning on a historic new labor contract, instantly ending a two-day strike and paving the way for GM to pay the union to take over $50 billion in retiree health obligations.

In calling off GM's first national walkout in 30 years, UAW President Ron Gettelfinger said he is excited to present the deal to members and hopes to win ratification by the weekend.

Both sides touted the accord as one that addresses the competitive gap that exists with GM's foreign-based competitors while protecting U.S. factory jobs. GM will make a massive payment to the union to take over retiree obligations in a move that would erase those costs from the automaker's books while locking in benefits for more than 400,000 retired GM autoworkers.

"It's an agreement we're proud to recommend to our membership," Gettelfinger said at a 4 a.m. news conference at UAW headquarters in downtown Detroit. "This contract will be better in some ways; it will be different in some ways. Our retirees will be exceptionally pleased with the contract."

GM CEO Rick Wagoner said in a statement that the contract will allow GM to become more competitive while investing in its U.S. operations.

"There's no question this was one of the most complex and difficult bargaining sessions in the history of the GM/UAW relationship," he said. "This agreement helps us close the fundamental competitive gaps that exist in our business. The projected competitive improvements in this agreement will allow us to maintain a strong manufacturing presence in the United States along with significant future investments."

The union will convene national leaders in Detroit on Thursday or Friday for a vote on the deal. Gettelfinger said the union hopes it will win ratification from the full membership over the weekend. Workers could return to the picket lines if the deal is voted down.

He said the strike broke a logjam with the company over commitments on job security the union was seeking from the automaker.

"I would say the strike probably helped our side more than theirs," he said.

He said did not know if the UAW would bargain next with Ford Motor Co. or Chrysler LLC.

Gettelfinger mum on specifics

Specific details of the tentative pact were not released, but Gettelfinger said the deal includes a voluntary employees' beneficiary association, or VEBA, that covers retiree health care benefits for the next 80 years.

Details that were coming together on Tuesday night included a two-tier wage structure for non-manufacturing jobs and cash bonuses over the next four years.

The two-tier wage system would allow GM to save money on jobs not directly related to building an automobile, such as housekeeping, security and janitorial work. Those jobs could command wages as low as $12 to $15 an hour. The new wage structure would apply to new hires, not current workers.

The bonuses, meanwhile, could help win ratification of a contract. The payments would be $3,000 to start, followed by three years of lump-sum payments roughly equal to 3 percent of annual wages.

The agreement also would include modifications to the controversial jobs bank program in which laid-off workers receive pay and benefits. The changes will expand the geographic area in which workers would be required to take a new job if one is available. Under current rules, workers are allowed to remain off the job and in the bank unless there's an opening within 50 miles of their old job.

Gettelfinger said the UAW "got the job security guarantees we were looking for." The UAW was pushing GM to make specific commitments to invest in U.S. facilities and build future products here.

Closing the gap

With both sides in agreement over shifting retiree health costs to a company-funded, union-run trust, the focus in the last days of negotiations centered on finding a way to slash GM's labor costs without cannibalizing the union's ranks or worker wages.

GM's goal was to wipe out what it says is a $25- to $30-per-hour gap in wages and benefits with foreign-based carmakers operating in the United States, especially rival Toyota Motor Corp. The automaker lost $12 billion over the past two years despite dramatic production cuts and marked improvements in its product lineup.

The UAW is fighting to stem a nearly 30-year trend of declining membership amid drastic downsizing of the U.S. auto industry and growing production overseas. UAW membership has fallen to 576,000 active members from a 1979 high of 1.5 million.

"Two words were used in the announcement -- competitive and investment. That's the framework of this contract," said labor expert Harley Shaiken of the University of California Berkeley. "GM gets an agreement that will make it more competitive and the UAW achieves investment in new plants and product."

The health care trust was in the spotlight through much of the negotiations, though Gettelfinger said on Monday that the strike wasn't over the VEBA.

The company has been pushing hard for a trust that will allow it to offload the retiree burden. Gettelfinger said it was the union that initially wanted a VEBA.

The arrangement still must win court approval and undergo an accounting review by the Securities and Exchange Commission, according to the GM statement.

Bargaining has continued throughout the strike that began Monday after nine days of post-deadline bargaining couldn't bring the two sides together. GM's hourly workers have been manning picket lines across the country since the strike started.

While protests remained peaceful on Tuesday, the strike's impact was beginning to be felt elsewhere, especially among parts makers and GM's Canadian suppliers.

 

Made a nice stock profit with this. Thanks UAW.

On the flipside this probably just made the UAW one of the largest HMOs in the world.

 

One thing I noticed is the lack of interest in the entire subject. News stations placed the subject in the middle to last just before the weather and sports.
Does anyone really care about GM and the UAW these days? A 2 day strike? Come on...........I thought they were serious about their convictions.

 

I remember the big strike in 1970....I was a high school senior. GM was a real automotive powerhouse in those days, and the strike was not just back-page news. It helped push the country into a recession. The saying was " As the country goes, so goes General Motors).

Today, of course, Toyota, at least to an extent, has taken GM's place as the country's premier automaker....but Toyota's U.S.-market employees seem content, at least for the moment.