Auto Bailout Talks Collapse

[minnie61650]

Just an FYI:



Hourly wages for UAW workers at GM factories are about 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.

But the unionized factories have far higher benefit costs.
The higer benefits cost would have been phased out by the year 2011.
The GOP wanted the workers to cut their pay of all the current workers and cut the current benefits so the total pay plus benefits would equal Toyota's which is currently about $48.

GM Vs. Toyota Wages And Benefits
By The Associated Press
Manufacturing.Net - December 12, 2008






DETROIT (AP) --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 was prepared to agree to a restructure plan but some Senate Republicans insisted on an arbitrary deadline for the UAW but did not impose a deadline on any other stakeholder groups.

<SNIP>

In a statement, the UAW said that "it was prepared to agree that any restructuring plan should ensure that the wages and benefits of workers at the domestic automakers should be competitive with those paid by the foreign transplants. ... Unfortunately, Senate Republicans insisted that this had to be accomplished by an arbitrary deadline. This arbitrary requirement was not imposed on any other stakeholder groups. Thus, the UAW believed this was a blatant attempt to make workers shoulder the lion's share of the costs of any restructuring plan." <SNIP>

http://adage.com/article?article_id=133214

 

[CarlaKay]

Even bush did not buy the lame case made by the hateful and partisan GOP Southern Senators. There will be no bankruptcy for the US automakers http://www.msnbc.msn.com/id/28311743/

The Bush administration came to the rescue of the troubled U.S. auto industry Friday, offering $17.4 billion in loans in exchange for concessions from carmakers and their workers.

"Allowing the auto companies to collapse is not a responsible course of action," President George W. Bush said. He said that a bankruptcy was unlikely to work for the auto industry at this time and would deal "an unacceptably painful blow to hardworking Americans" across the economy.

One official said $13.4 billion of the money would be available this month and next, $9.4 billion for General Motors Corp. and $4 billion for Chrysler LLC. Both companies have said they soon might be unable to pay their bills without federal help. Ford Motor Co. has said it does not need immediate help.

 

[Charade]

Even bush did not busy the lame case made by the hateful and partisan GOP Southern Senators. There will be no bankruptcy for the US automakers http://www.msnbc.msn.com/id/28311743/

You just can't help yourself, can you?

 

[CarlaKay]

You just can't help yourself, can you?

I am very pleased that the hateful and partisan Southern GOP Senators are not getting their way. I saw earlier this week that Corker, Shelby and others were mad at bush for not backing up their power play and letting the unions off the hook. Too bad.

The bridge loan will keep the US car makers alive until President Obama can deal with this mess and the UAW will not be destroyed.

 

[Galahad]

the UAW will not be destroyed.

Why should it not be destroyed? What purpose does it currently serve? Auto workers at non-union companies are not abused or suffering. Eliminating the UAW is not sufficient to save the Big 3, but it is certainly necessary.

 

[MarkBarbieri]

I am very pleased that the hateful and partisan Southern GOP Senators are not getting their way. I saw earlier this week that Corker, Shelby and others were mad at bush for not backing up their power play and letting the unions off the hook. Too bad.

The bridge loan will keep the US car makers alive until President Obama can deal with this mess and the UAW will not be destroyed.

Well, you've finally motivated me to take action. I've added you to my ignore list. Unlike the others who shared your position on this subject, you've written nothing useful. Instead, you've simply spit out hate filled rants.

It's possible that I'm just dense and can't see that you are really a Republican trying to sabotage the Democrats by making them look mean spirited and hateful. If so, ha, ha - you tricked me. If not, I suggest that you learn how to discuss and debate a subject in a way that entices people with other viewpoints to consider yours, not be increasingly repelled by it. Thank goodness the country will soon be lead by someone that rises above this sort of thing.

As for the specifics of the President's bailout, they look remarkably similar to what the Republicans were proposing. It sounds like the country finally got the compromise that it wanted and not the one sided bill the Democrats thought they could force through congress. It's not what I wanted (a well managed restructuring), but it is better than the original proposal.

 

[ntsammy5]

It sounds like the country finally got the compromise that it wanted and not the one sided bill the Democrats thought they could force through congress..

Au contraire! As has been the norm in the Bush White House (until just recently) there has been and was a total lack of compromise. The Republican Right took a position that they would not budge from even a little bit. This has been the approach they have taken many times - my way or the highway is not compromise it's petulant juvenile behavior, especially when applied to the U.S. Senate.

 

[CarlaKay]

Boo Hoo. In addition to being filled with hate for unions, these southern GOP senators are also crybabies http://www.talkingpointsmemo.com/archives/248957.php

Sen. Shelby (R-AL) releases statement about auto bailout ...

"The plan the President announced today gives the taxpayer no upfront assurances that these companies will take the steps necessary to become efficient and competitive. In fact, the only assurance the taxpayer has is that these companies will be back for more money soon. It is unrealistic to think that companies who have failed to make tough choices over decades will get their act together now that they have received a down payment from the taxpayer."
"Congress was wrong to grant the Administration the authority to bail out the financial industry through the TARP in the first place. The President is wrong to use this authority to bail out GM and Chrysler. Instead of pursuing the more responsible course to ensure that these companies restructure through Chapter 11 bankruptcy, the President chose to stick the taxpayer with the tab as he walks out the door. I believe it is a shameful attempt by the President to protect his own legacy. The taxpayer will surely remember him for it."​

The senators are so filled with hate for the UAW and unions that they are crying about bush's actions. Too bad

 

[CarlaKay]

As for the specifics of the President's bailout, they look remarkably similar to what the Republicans were proposing. It sounds like the country finally got the compromise that it wanted and not the one sided bill the Democrats thought they could force through congress. It's not what I wanted (a well managed restructuring), but it is better than the original proposal.

Except that these provisions are not part of any law and so therefore can be rescinded or modified when a sane and less hateful administration takes office. This bailout does the important thing of getting the US automakers past the bush administration so that people who do not hate unions will be in charge. After the first of the year, Shelby and the rest of his union hating crybabies will be down in votes in the Senate and will be easier to deal with the next time they try a filibuster (that is why this time period was the last best chance for these union busters to try to bust the union).

 

[jodifla]

Except that these provisions are not part of any law and so therefore can be rescinded or modified when a sane and less hateful administration takes office. This bailout does the important thing of getting the US automakers past the bush administration so that people who do not hate unions will be in charge. After the first of the year, Shelby and the rest of his union hating crybabies will be down in votes in the Senate and will be easier to deal with the next time they try a filibuster (that is why this time period was the last best chance for these union busters to try to bust the union).

Exactly. The Big 3 needed to survive until an Obama presidency, where a man who knows the meaning of the word COMPROMISE is in office.

It's very telling to me that even Bush felt the need not to let the auto companies fail.

 

[minnie61650]

Boo Hoo. In addition to being filled with hate for unions, these southern GOP senators are also crybabies The senators are so filled with hate for the UAW and unions that they are crying about bush's actions. Too bad

I am also dissapointed in the way some of the southern senators ,both Republicans and Democrates who have tried to defeat the much needed bridge loan for the Detroit 3.

My 27 year old staunch Republican son is so mad at the southeren senators for the way they treated the Detroit 3. He is especially mad at Senator Shelby and said he will never ever buy anything from Alabama again!

I have never seen him mad at/or say a negative word against a fellow Republican before. (Of couse he will not refer to Senator Shelby as a Republican he just groups Shelby in with the (insert bad word) "Southren Senators" .)

Just my 2 cents.

 

[S. C.]

http://apnews.myway.com//article/20081220/D956NTL00.html

Motor City's woes extend beyond auto industry


Dec 20, 6:20 PM (ET)
By DAVID CRARY and COREY WILLIAMS


DETROIT (AP) - One measure of how tough times are in the Motor City: Some of the offenders in jail don't want to be released; some who do get out promptly re-offend to head back where there's heat, health care and three meals a day.

"For the first time, I'm seeing guys make a conscious decision they'll be better off in prison than in the community, homeless and hungry," said Joseph Williams of New Creations Community Outreach, which assists ex-offenders. "In prison they've got three hots and a cot, so they commit a crime to go back in and come out when times are better."

For now, better times seem distant. Even with no hurricane or other natural disaster to blame, Detroit has - by many measures - replaced New Orleans as America's most beleaguered city.

The jobless rate has climbed past 21 percent, the embattled school district just fired its superintendent, tens of thousands of homes and stores are derelict and abandoned, the ex-mayor is in jail for a text-messaging sex scandal. Even the pro football team is a pathetic joke - the Lions are within two losses of an unprecedented 0-16 season.

And overarching these and many other woes is the near-collapse of the U.S. auto industry, Detroit's vital source of jobs and status for more than a century.

"We're the Motor City," said Scott Alan Davis, who oversees community development projects in one of the worst-hit neighborhoods. "When the basis for that name collapses, that's started to scare people."

Among the worried is 81-year-old Warlena McDuell, a retired surgical technician who shares a home with her cancer-stricken daughter. On a recent weekday, she was among hundreds of Detroiters, most of them elderly, filling orange-plastic grocery carts at a food bank run by Focus:HOPE, a local nonprofit.

"It's a depression - not a recession," McDuell said, with the authority of someone who has lived through both. "It will get worse before it gets better."

Behind her in line, stocking up on canned apple juice and fruit cocktail, was Benjamin Smith, 77, who once held jobs with Uniroyal and Chrysler. Maneuvering his cart slowly, one hand gripping a cane, he was unable to muster much cheer when someone extended holiday good wishes.

"How are we going to do well?" he replied. "Everything's busted up."

Focus:HOPE's food program serves 41,000 people a month; manager Frank Kubik estimates that's only half the number of Detroiters in need of the assistance.

"It's not going to be a nice Christmas for a lot of folks," he said.

DeWayne Wells, president of Gleaners Community Food Bank of Southeastern Michigan, said demand is up by 25 percent from a year ago in the region's food banks as auto-industry layoffs multiply.

"Many people are first-timers - they have no idea how to navigate the system, how to qualify for food stamps," Wells said. "Last year, some were donors - now they're clients."

---

 

[ols386]

I've owned Chrysler and GM cars within the past 5 years and they all stunk!! Quality problems up the wazzooo! Have a Honda for three years with no issues.

You make junk cars and you go out of business.

I've owned GM vehicles all my life, and have not had quality problems. I wouldn't even think of buying a Honda....it doesn't help the U.S. economy. But if you want to buy them, and put your money in the pockets of a foreign country, then you have every right to do so.

 

[Galahad]

I've owned GM vehicles all my life, and have not had quality problems. I wouldn't even think of buying a Honda....it doesn't help the U.S. economy. But if you want to buy them, and put your money in the pockets of a foreign country, then you have every right to do so.

But this isn't how it works. It certainly does help the U.S. economy. I buy Honda's and it puts my money in the hands of the American workers that build them and the American dealers that sell and service them and the American advertising companies that market them and the shareholders that own stock - which can and should be people from all over the world. It ain't us vs. them any more. The more we try to make it us vs. them the more likely it is that we will lose that little tussle.

 

[arminnie]

I've owned GM vehicles all my life, and have not had quality problems. I wouldn't even think of buying a Honda....it doesn't help the U.S. economy. But if you want to buy them, and put your money in the pockets of a foreign country, then you have every right to do so.

My Honda was made in the U.S. by American workers. But I guess in your world any workers outside of Michigan are just non-deserving slackers who don't help the U.S. economy.

My GM automobile was also made in the U.S. by TOYOTO employees.

 

[minnie61650]

My Honda was made in the U.S. by American workers. ........
My GM automobile was also made in the U.S. by TOYOTO employees.

Which is another reason we (US citizens) should hope the Detroit 3 do not go belly up.

The Detroit 3 , US Honda , and Toyota are inter connected. They share the supliers and if the Detroit 3 fail then the auto parts suppliers would most likely fail causeing the US Honda & US Toyota to close thier US factories.

In that senerio all of our auto would be imports.

Take a look at this article:

Why Toyota wants GM to be saved
A GM failure would cause production problems, crush already weak demand and potentially open the door to low-cost competitors.

Last Updated: December 16, 2008: 9:53 AM ET


NEW YORK (CNNMoney.com) -- Detroit's Big Three aren't the only automotive companies that want to see the government step in with some much-needed financial help.

Overseas automakers, most notably Toyota Motor, all endorse some form of federal aid to keep General Motors (GM, Fortune 500), Chrysler LLC and possibly Ford Motor (F, Fortune 500) out of bankruptcy.

The Senate killed an effort to get the automakers a stopgap loan last week and now the Bush administration has said it is looking at providing the automakers help from the $700 billion approved to bail out banks and Wall Street firms.

"We support measures to help the industry," said Toyota Motor (TM) spokeswoman Mira Sleilati. "We just want a strong, competitive healthy industry."

This may seem surprising at first, especially considering that much of the opposition to the auto bailout was from senators from Southern states that are home to auto plants operated by Asian auto companies, such as Alabama and South Carolina. But the Asian automakers insist they never lobbied against such help for the Big Three.

And this makes sense after taking a closer look at the dynamics of the auto industry and the intertwined fates of its companies.

Here's why Toyota, Honda Motor (HMC) and other Asian auto manufacturers clearly believe they are all better off if GM and Chrysler survive.

Collateral damage

The overseas automakers, who between them produce more than 3 million vehicles a year at U.S. plants, all worry their production would be hurt if one of the U.S. automakers went under. That's because a Big Three failure would likely lead to widespread bankruptcies in the auto parts supplier industry.

Erich Merkle, lead auto analyst with the consulting firm Crowe Horwath LLP, said there is much overlap between the automakers' suppliers. Since most parts in an automobile have only a single supplier producing them, the disruptions in production will be severe and prolonged.

"It could take months for a Toyota to work through that and resume normal production," he said.

Merkle said the current network of auto suppliers, manufacturers and dealerships has worked well for the overseas automakers, who have posted steady gains in their U.S. market share during the past few years.

Besides sharing suppliers, many dealers sell both U.S. and overseas brands. So the failure of a U.S. automaker could hurt the overseas manufacturers' dealer network and their sales as well, Merkle said.

"There would be a severe disturbance in the force," he quipped.

Economic shockwaves
A collapse of one of the Big Three would also probably cause an even more severe hit to the U.S. economy. That would further eat into demand for U.S. auto sales, which hit a 26-year low in November.

"The U.S. economy would be in shambles," Merkle said. "The robust U.S. economy that Toyota and the others depend on would suddenly not be as lucrative." <SNIP>

Full Link:

http://money.cnn.com/2008/12/15/news/companies/overseas_automakers/index.htm

Just my 2 cents

 

[JimFitz]

Except that these provisions are not part of any law and so therefore can be rescinded or modified when a sane and less hateful administration takes office. This bailout does the important thing of getting the US automakers past the bush administration so that people who do not hate unions will be in charge. After the first of the year, Shelby and the rest of his union hating crybabies will be down in votes in the Senate and will be easier to deal with the next time they try a filibuster (that is why this time period was the last best chance for these union busters to try to bust the union).

Carla......Do you honestly believe the Big Three have a chance to survive? I guarantee we are back in the same boat in 20 years. There will be mergers and other things but in the end we will be back on the same situation.

This is the Unions fault for their excessive greed. This is managements fault for poor management.

 

[minnie61650]

Carla......Do you honestly believe the Big Three have a chance to survive? I guarantee we are back in the same boat in 20 years. There will be mergers and other things but in the end we will be back on the same situation.

This is the Unions fault for their excessive greed. This is managements fault for poor management.

I am not Carla but I honestly think at least 2 of the big 3 can survive. Chrysler may be sold or merge with one one other 2 in the future but I really think a leaner stronger U.S auto industry will survive.

Mergers have taken place in the past and a merger may take place in the near fure but yes I think at least 2 of the Detroit 3 will survive. Because if they don't survive than as I said the ripple effect will kill all the US plants including the US Toyota and Honda Plants.

As far as the Unions go the new hires will not have compny heatlh insurance or retirement benefits when they retire. Come this January 1st 2009 all retired white collar workers will no longer have health insurance paid by the Detroit 3 auto companies.

By 2011 the Detroit 3 even with the retired workers Health and pension benefits will be even in pay with the US honda and US toyota employees.

It is too a great a risk to let GM and Chrysler fail!

Do you rember a car company called American Moters?

Here is a little history:

American Motors was the company created by the merger of Nash-Kelvinator Corporation and Hudson Motorcar Company in 1954. At the beginning of the automotive era, there were literally hundreds of auto makes; Nash and Hudson were two of the largest independents.

When the Great Depression came along, almost all of the smaller ones were wiped out, leaving giants like GM, Ford, and Chrysler, and a few small independents like Kaiser, Fraser, Nash, Hudson, Packard, Studebaker, Willys, Checker, Crosley, and probably a few others I'm forgetting.

Kaiser swallowed up Fraser and Willys; while Packard merged with Studebaker, and Nash went with Hudson. The plan of then-Chairman of Nash, George Mason, was to eventually merge Stude-Packard with Nash-Hudson and then, taking the various strengths of each partner and creating a cohesive larger company on the model of Chrysler or Ford, to share subassemblies, engines and other parts across all divisions in an effort to become an all-market player.

It never worked out. Studebaker-Packard decided to go it alone and ultimately went out of business, in the mid-sixties. Nash and Hudson sales, for their part, dropped through the floor as sales from the company's Rambler division began a march toward profitability. In 1957, the last Nashes and Hudsons rolled off the assembly lines and American Motors became the sole division until 1970 when AMC purchased the rights and facilities of Jeep from Kaiser-Willys.

American Motors lasted thirty years. Some of the little company's best years were in the early seventies, when the company sold over 300,000 cars for a couple of years. Then, poor product planning such as the seven-year lack of a four-cylinder engine for the Gremlin and millions of dollars on development money wasted on poorly conceived models lineup ruined the future for AMC. They never recovered.

By 1987 a trail of red ink followed behind a stumbling and eviscerated company, and Chrysler Motors purchased it for a fire-sale price. <SNIP>

Link to full article:

http://hasdrubal.tripod.com/AMC-01.htm

 

[minnie61650]

From 7 myths article:

Chrysler tied Toyota as the most productive automaker in North America this year, according to the Harbour Report on manufacturing, which measures the amount of work done per employee. Eight of the 10 most productive vehicle assembly plants in North America belong to Chrysler, Ford or GM.

The oft-cited $70-an-hour wage and benefit figure for UAW workers inaccurately adds benefits that millions of retirees get to the pay of current workers, but divides the total only by current employees. That's like assuming you get your parents' retirement and Social Security benefits in addition to your own income.

Hourly pay for assembly line workers tops out around $28; benefits add about $14. New hires at the Detroit Three get $14 an hour. There's no pension or health care when they retire, but benefits raise their total hourly compensation to $29 while they're working. UAW wages are now comparable with Toyota workers, according to a Free Press analysis.

Contact MARK PHELAN at 313-222-6731 or phelan@freepress.com.

 

[CarlaKay]

Carla......Do you honestly believe the Big Three have a chance to survive?

All of the automakers are being hit by the latest financial crisis. Toyota just cancelled or delayed a 300 million plant to build hybrids in the US. I think that with some support and some hard work, the US automakers can surivive. Ford had already passed on this assistance.

The real issue here is that a group of southern GOP senators were using this emergency to destroy the unions that they hate. The GOP blames the unions for the losses in 2006 and 2008 and were going to use this situation as an excuse to hurt the UAW.

Because of the hatred and stupidity of these GOP Senators, there is no Car Czar and the restrictions in the loans from the TARP funds and the Treasury department can be modified and changed by the Obama administration after President Obama takes office.

I think that Ford and GM will survive. Chrysler is owned by Cerebus which is a private equity fund that has taken some large hits lately and I think that we will see Chrylser sold at some point.