Source.
President Bush – this is your “air traffic controllers” moment. Do not waver.
Someday, a nation will thank you for it.
92 Replies to “Let. Them. Go.”
Bought my first Honda in 1982. Haven’t looked back since. Currently an ’07 Civic that runs a treat. And it’s made in North America. Having lived in an auto town for several years, I can tell you these guys aren’t starving by any means. Laid-off workers get a top-up to 90%
of their salary and benefits include legal plan as well as medical, dental etc. CAW effectively runs the company. My prediction is the domestic auto industry is going to go the way of the Brits.
Phantom, I was raised a Ford man, but the only new car I bought was a 71 Camaro z28 (4 spd 4.10 rear heh). And I drove Volvos with fuel injection long before most people had even read about it.
Before that I also had a Porsche 1600 Super and a TR3, so I am a free thinker on autos.
But the fact remains that Detroit fell behind after Nader put the kibosh on Detroit innovation by going after GM over their first Corvair (I also had a 65 Corvair Corsa with the good suspension heh).
I also like cars I can fix but we are dinosaurs in the world today. Luckily most cars in general today are so superior to our older stuff it is unreal. Both Detroit and the furreignners deserve kudos for that.
Do all of you pick-up drivers live on farms or do you just enjoy spending more on gas than food each month?
What the hell use is a pick-up truck on a day-to-day basis if you aren’t rural (or a tradesman, etc.)?
Do all of you pick-up drivers live on farms or do you just enjoy spending more on gas than food each month?
What the hell use is a pick-up truck on a day-to-day basis if you aren’t rural (or a tradesman, etc.)?
Chuck, it is hardly my fault if you don’t like the results obtained by using the Big Three’s numbers. THEY say their costs are $73.20 per hour, and THEY say it takes almost 24 hours to build a car. If you think the result is incorrect, do the math yourself. IF you STILL don’t like the answer, your problem is with the data and that, amigo, is not supplied by the union. Those are facts, no matter how much you whine about it or pretend to be a financial wizard. As I said before, if you eliminate the labour cost completely, the cost of a vehicle is reduced by less than $1800 dollars. I’ll tell you what: you tell me how much YOU think the labour cost is for an average Big Three vehicle, if you really believe that Toyota has a $3000 cost advantage per vehicle.
Reality is that the US bailout, now up to $75 Billion, will mostly go to selling the existing inventory of cars at firesale prices. After that’s done, the Big 3 will declare bankruptcy because their products will not sell in the current situation.
It’s over .. nobody is going to invest in a big, overpriced yank tank because it has no resale value, and you can’t expect to keep running it after the manufacturers finally go bankrupt. Would you ‘invest’ in a Cadillac knowing it’s going the way of the dinosaur?
WTF did you think was going to happen with the Billion$$$ of bailout money … the rebirth of the Detroit Big 3 …???!!!
This could be very significant going forward;
[Now that it has negotiated a new labor contract with the United Auto Workers, General Motors has shrunk its labor cost gap with Toyota down to $800 per vehicle.
Just two years ago, that gap ran as high as $4,000 per vehicle, said Dave Cole, head of the Center for Automotive Research in Ann Arbor[Financial Week
Who knows, but at $4 bucks a share, we may look back some day and say; Boy was I stupid. The Engine and tranny lines alone were worth $40 bucks a share.
8 years ago, $81 bucks
A year ago, $25 bucks
Today, a share can be got for less than $3 bucks.
Even if GM clawed back to within only a quarter of it’s peak value ($20), that would represent a gain of 700% from today !!
Moves like that is what make the rich, really rich. Think Buffet.
Finnbar,
You haven’t even begun to address my argument. If you do not believe that the 12.5% disadvantage comes from labour, please make a rational case for another factor that could explain the discrepency. I already outlined the 3 major cost components. Please explain how Toyota could have a 12.5% advantage from raw materials or energy.
Meanwhile, GM has improved its gross margins from -0.6% (yes it actually lost money on each car it sold in the US before factoring in SG&A, depreciation, interest and taxes) in 2005 to 2.8% in 2007. How did it do this? Well, part of it is $9B in advantages from cutting costs from labour. That’s 5% of revenues. GM also estimates that its labour costs represent 30% of sales in 2007. It hopes to cut this to 25% by 2010. GM’s recent health care settlement with the union cut 1.1B in costs alone. Where did I get this info? How about simply reading the annual report? Apart from the auditors, thousands of analysts pour over these numbers to make sure they are correct. Lying on a 10-K amounts to fraud, and eventually these types of lies come to the surface … think Enron.
BTW, I don’t know what you do for a living, but you obviously have no clue how to analyse a company’s financials.
one word for the mess
UNION!!!!!!!!!!!!!!!!!!!!!
Ummmm … Ron … Buffet only buys stable businesses with great managements and great track records. GM is trading at $3 because it is about to run out of cash. It only has two ways out, finance itself with debt or equity. Since banks are not going to lend, it is safe to say equity would be the only option. If equity is used, current shareholders will face massive dilution and hence lose almost everything. If the company goes into receivorship, then the bondholders will have first dibs at the assets and you can bet there will be a fire sale. Either way, there are tons of great firms trading at outrageously low valuations … stay clear of GM.
Warwick, I buy big American trucks because I can, Chevy Avalanche, Silverado, Lincoln pick up, and Cadillac SRX V8 AWD. Why the hell not. While I live in an agricultural area, the only time my vehicles go off road is when I lose momentary control. Mind your own business and enjoy yourself in the rice grinders.
The Japanese manufacturers have gotten a free ride in the U.S. building facilicities with huge state benefits and no legacy overhead. In Japan, U. S. manufacturers can barely get through the red tape to establish mere showrooms. Similar to our beef and rice producers they have mammoth protectionist restrictions on foreign products. Some ally.
In the meantime, I buy my vehicles based on what I know, not what Catie Couric said on the news. My Dad was always a Ford man until I turned him to the “dark side” with GM. He owns two GMC Yukons and a GMC “Jimmy.” The Jimmy is the ranch truck and so only has around 220,000 miles. The two other Yukons do “road duty” and so have well over 300,000 miles. Neither has ever had any work to the 4WD or the motors. Actually, the 2001 turned over 300K this past Spring. Don’t tell me about Japanese quality. There is some fact in the reputation mixed with a lot of gullibility. I’ve been driving Fords or GM products, one Jeep Wrangler Sahara, since the ’70s. I don’t need either hand to count problems because there haven’t been any. AND, I thrash my vehicles. The Big 3 provided jobs, housing and college to millions of Americans over the decades. I for one would rather bail out those jokers than hand money over to smart ass venture capitalists who weren’t as smart as they thought they were and in any case should have known better.
The labour costs in a big 3 vehicle accounts for only 7% of the final price. Canadian autoworkers could work for free and it would change nothing. Working in an assembly plant is very difficult. Yes, I work in one, and I can honestly tell you that I do not feel overpaid. There is no real quality gap betwwen the big 3 and others. Only a percieved gap. The plant I work in uses 17 man hours to build a vehicle – better than all the japanese plants. Our quality is second to none and always getting better. The vitrol in this thread (and others) toward the autoworker is unjustified. The canadian autoworker is the world’s best and getting better. This industry is definitely worth saving in my opinion. I am not a bloviating, loudmouth union lardass. Sure there are those, but they are generally ignored. We know what’s going on around us and have always been willing to change and compromise and improve to survive. Being a lifelong conservative is difficult in a union shop sometimes, but the union hard ons are increasingly being marginalized and ignored. Please stop dumping on the canadian autoworkers. We are smarter and harder working than most think. It is a vibrant industry that finds itself in the crosshairs of a serious situation. We will recover and continue to make vehicles second to none for a very good wage. What’s wrong with that? The claim that productivity suffers with every new collective agreement is simply not true. Productivity in the canadian auto indrustry is the best ever and getting better.
While there have been bailouts in the past that have worked (Lee Iaccoca Chrysler)
Posted by: rockyt at November 11, 2008 10:12 AM
Well, rockty, not to go all ideologically pure on you, but “worked” is questionable. Read some Frédéric Bastiat, esp. about the “what is seen vs. what is not seen”. To wit, you can’t know this ‘cos you don’t know what productive use this money could have been put to had it not been expropriated by the government.
That Crysler continued as a commercial enterprise does not prove that the bailout “worked”.
ok4ua I don’t get the point of your question. Whatever Kate’s gross family income is is hardly relevant here. We are not saying that there are no people who make more than Big 3 auto workers (certainly we all know about teachers, public servants, bus drivers . . . they all take home a pretty good buck.) The point is that in comparison to the average hourly wage, Big 3 auto workers are clearly way beyond the average. This tends to be the case with most union shops. The result is a two-tier universe — union workers and then others (many small business people). I think in view of this it is necessary to make some judgments about whether or not union concessions re salaries are appropriate if there is to be a bail out — or even whether or not a bail out is warranted. Funny, I have also noted that some among the most wealthy and priveleged of these well-paid union groups are also staunch NDP supporters (lots of teachers, univer. profs, etc.) — so much for “social justice”.
Charles, I agree. I used GM as an example how of this deep downturn could, could be a huge buying opportunity – even with a poorly run company as GM, Ford ect. (panic may, may have driven it lower, much lower than fundamentals would suggest.
I also agree, the stable, well run companies are the ones to hold today. They have been collateral damage in all this. (Proctor ? J&J ? Wells F ? Power Corp ? Genentech ?)
iowavette,
lol. well, if you want to piss away your money on gas, go right ahead. I will always have better things to spend my money on.
You did hit on a huge portion of the big-3-dino’s problems though. It’s the “legacy overhead” combined with bad engineering and a shoddy product which will sink them.
If you haven’t had your GM’s in to the shop much you must fix them yourself. My mom drove a Yukon Diesel and it was in the shop so often she was happy to be rid of it. My first car was a ford. It was my last ford. In my family, the GM’s and Fords have all sucked and the Hondas and Toyotas have been faultless. You can whine about it being “anecdotal” all you want but you go with experience. My current Honda was built right here in Canada and I my best friend just moved from Dana where he worked in a now defunct unionized truck frame plant (F150 frames) to the new Toyota plant. They provide plenty of jobs here.
As for the “big-3” not being “let into” Japan, I can’t see why anyone would want to try. The Japanese buy mostly small cars. In case you didn’t notice, there isn’t much room in the average Japanese city so if you drove a chevy half-ton you’d have a half-ton worth of paperweight while you sat stuck in traffic you can’t get through. There isn’t any demand there for the crap GM or Ford makes. They only people who buy big vehicles there are the rich who tend to favour Mercs and BMW’s to Lincolns and Suburbans.
Chuck,
Why do you refuse to address what I’ve said? Let’s continue, shall we? YOU say that GM says labour is 30% of its sales for 2007…fair enough, let’s use that figure. With 266,000 employees and 30% of 181 billion dollars, they now claim that each employee “cost” them about roughly $212,000. Since they didn’t pay me anywhere near that amount, the rest must have gone into funding my pension fully………oops, wha’dya mean my pension is underfunded? I do not know what they do with the money they earn but labour is hardly where it goes.
You seem quite willing to take their word for what the figures are, so much so that you convince yourself that auditors get to see the real books. You tell Ron that Warren Buffet wouldn’t buy GM because it is poorly run but then you have profess faith in their auditing process? Let’s make it real simple: if GM wants to get public money, the government should get unlimited access to their books. And if you think that will ever happen, I’ve got some very valuable GM stock to sell you.
finnbar
As an economic illiterate, I would not expect you to understand these things.
But you did hear that labour costs for the companies include RETIRED employees as well as those currently working?
In other words, the pensions, health benefits/drug costs, etc. have to be included.
I also bet you didn’t know that the retired employees cost MORE per year than those actually making their product?
If GM shut down today, tomorrow’s labour costs would still be huge.
Warwick asks(somewhat heatedly I must say): “What the hell use is a pick-up truck on a day-to-day basis if you aren’t rural (or a tradesman, etc.)?”
1. It will shrug off a direct hit from a minivan, and survive one from a transport truck.
2. You can put a 4×8 sheet of plywood inside where it won’t get rained on.
Try that with a Honda Civic.
The money I save on gas by driving a small car is no good to me if I’m dead. Being in the medical rehab biz, I’ve met a lot of people who’ve been smashed to crap in car accidents. This has left me with a profound need to have lots of mass on my side of the crash equation. I happily pay for the gas to haul all that mass around.
If I was poor, I’d drive some ancient barge like I used to when I was a kid. 1978 Olds, baby. Big like a mountain, nasssty like barbed wire. Nobody EVER cut me off in that thing. Same with the Pontiac. Same with my truck these days. The morons fear the big iron.
Conversely, every single time I drive my smaller car somebody will cut me off, tailgate me, or pull some other stunt. My driving style doesn’t change, just the size of the vehicle.
Big is good. Small, not so good. This is the Phantom Theory of Vehicles.
“2. You can put a 4×8 sheet of plywood inside where it won’t get rained on.”
1-How often you do drive around with plywood?
2-do you drive around with plywood more often because all your friends and family know you have a pick-up?
As for the size vs. survivability, engineering wins over mass and with a smaller car, if you aren’t an incompetent driver you can manoeuvre easier so you don’t get into an accident.
I’m not saying don’t buy what you want. I don’t care if you blow your money at the track. I’m just saying it surprises me how many people waste good money on pick-ups they don’t need. But to each their own.
Kill the corporate welfare fatted calf. Since when do tax dollars go for incompetence at business? To continue to make a lavish lifestyle for bums. The Unions have become a burr under the saddle of regular workers. Teachers unions I recon to be the worst for political & economic blackmail.
The result of this socialization has been poor productivity, the loss of any real democratic Unions to user abuser mooches, who take from peoples checks with avarice, since they can’t work a real job. Presidents for life. Money for nothing & there homes for free , including cars. Frankly I see little difference in both these organizations leaders.
If where to pay these losers at least give us some stocks as compensation.
Spend some money in worker education. Inspection systems. Make the product well, not based on old models, but sound engineering as America was famous for with Canada. A low dollar made us lazy, sloppy & stupid for handing con men our lives out of expediency. We l noticed the price4s for cars did not go down when we equalized our dollar with the US. It took months until even the press figure3d it out. Gouging your customers can make money in the short term. Kills you with a bad rep. When the Canadian dollar went lower it was not 10 hours before they raised prices back to 40 cents on the dollar. Who needs these crooks. The3 same could be said for furniture companies & the rest including oil. I notice as usual between 20 & 10 cents less a liter in the EAST. Nice to know where being buggered that way as per usual by Easteners. Is there not one business, or bank, including the government in this Nation that doers not rip off its own Majority of peoples, by gouging with over taxation, high absurd prices or just plain theft?
JMO
Let’s get something clear. I do not believe GM should get any public money. Governments should never own companies because inevitably decisions become political and not economic If they do, I firmly believe management should get fired and the union canned. Management should have never caved in to the union.
Have you ever heard of the job bank? GM actually has to pay ex-employees 90% of their salaries even after firing them. Furthermore, GM has to pay insanely generous retirement benefits to past employees. So your formula does not work. It is simplistic and ignores reality.
I again will restate my position. How do you explain the EBITDA margin difference between GM and Toyota?
And another thing. GM is a poorly run company. But auditors are independent. Auditors must audit good and bad companies. What’s your point?
Chesswiz and Warwick, I meant to say at the end of this contract just signed. According to the Toronto Sun the high wage would be 94K with the median one being $83k. This is an incredible wage for 158 days of work.
Chesswiz, don’t be to sure that teachers would do just as well in the private sector. My wife, who was a director at one of Canada’s largest accounting firms, worked in Human Resources and interviewed many teachers at a downturn several years ago. They were in such a huff when she said you have few marketable skills for business with a degree in history or fine arts. As noted by many posters here these degrees mean little in private industry and many businesses are loath to hire former teachers as they come from a heavy, heavy union environment with all sorts of entitlements and attitudes. Check Dion out as an example!
Robert W. wrote: “It would be fascinating to show poll respondents the graph and then ask them whether they think the autoworkers should be bailed out with our tax dollars.”
The only way that the masses are going to become aware of this massive, potential tax liability is if people like us make them aware.
Copy and past the graph and title and comments provided by Kate (with attribution on course) and paste them into your Outllook or other e-mail program. Then send them to everyone in your address book and ask them to forward it to everyone they know.
Otherwise, with Ontario putting heat on Stephen Harper, it’s going to be a done deal and we’ll all be back in deficit territory again.
One other thing to be aware of with the Big 2.5 is the public’s perception of long term viability. If the potential buyer of a GM or Ford feels they may not be around in a few years they may be reluctant to purchase the vehicle and the tipping point would have been reached. This happened as mentioned to the English car companies and they all disappeared.
Actually Me N D, you have a good point about opportunity cost.
But the reality is that if Chrysler borrowed the money at the going rate, and paid it all back (ahead of time even) which they all did, then nothing was lost by the govt. In fact, comparing the Chrysler loan to the pathetic record of Cdn govt loans not being paid back ever or token repayments at best, it was a excellent investment for the US gubmint because a local company kept local people employed for another 20 years and they got all their tax dollars back.
And that’s all anybody else could have with the money at the time also.
Of course if you can show exactly where this same money was asked for by somebody else at the time and the exact noble purpose they were going to use it for, then maybe we can further discuss Bastiat’s/your theoretical side of the question.
Chazz said: “I can honestly tell you that I do not feel overpaid.”
That’s a first. A union worker who feels he’s not overpaid! Keep that one for the archives.
Dave, the numbers are fishy again. I assume you meant teachers work 185 days, rather than 158? Still doesn’t sound like much, I suppose, if you’re not in the profession — and not aware of how many evenings, weekends, and holidays are spent on the preparation and follow-up required to do the job properly. Then there are the additional qualifications courses taken at your own expense during summer “holidays.” For those teachers who DO dog it, well, like Warwick and his wife, I have a lot of sympathy for the idea of getting rid of them, and no patience at all for the unions that defend their incompetence.
Yes, the max. in 4 years time will be about 94K. That will be earned only by those teachers with maximum experience in the top pay category. I don’t know how the Star could claim to calculate a median, since that would require knowing how many teachers are employed, and what they each earn — which I doubt the Star does. I’m guessing they just picked a big number from what looked to be about halfway up the grid. And even if 83K will be the median in 4 years, that means half of all teachers in the province are making less than that — many of them a lot less.
Re: private sector jobs: point taken. I didn’t mean to suggest that any old teacher could simply walk in to any private sector job they wanted; I’ve known more than a few I wouldn’t hire to walk my dog. A more accurate way to put it would have been to say that a comparably educated professional in the private sector has the potential to make vastly more than a teacher ever will — one of the reasons fewer men have chosen to enter the profession in recent years, especially in the elementary division.
Correction: I meant “the Sun,” not “the Star.”
rockyt at November 11, 2008 5:21 PM
Well, rockyt, I DO confess that I had forgotten that the Chrysler bailout was a loan at market rates which was paid back before the deadline. Nevertheless, I’m still squeamish about risking taxpayers money on a gamble which may well not have paid off.
If it was such a good investment for the gubmint why not for private lenders? Also, I’m uncomfortable that CEOs even see this as an option, and even in the form of a loan it does create moral hazard.
But you’re right, my reference to Bastiat may not have been quite apt in this case.
On the subject of Bastiat’s “what is not seen” it is quite amazing how many economists fall for the fallacy. Recent Nobel laureat, the moonbat BDS sufferer Krugman opined that there was a silver lining in the cloud of 9/11 vis-a-vis the economic “stimulus” of rebuilding. The “broken window fallacy” I think Bastiat called it.
Wading into the war of experiences with vehicles, I can tell you after six years of renting vehicles instead of owning one, you get more bang for the buck with a toyota, honda, mazda, etc than a North American model. Even comparing a North American model, say Mazda Protege to a Mazda 3 built overseas, there is a difference, although not as blatant. Early rice burners did have issues with Canadian winters and roads in the early years (had a Hyundai and a Honda back in the 80’s) but they adapted and improved the product to the point that I’d rather not get a North American model.
And for the record, I was and always will be a pick up truck guy (’66 GMC) but now drive a Mazda 3 on a daily basis. It is fantastic on gas and parks great but I have trouble taking a plasma tv or sheet of drywall home, not to mention no trailer towing. If I had the luxury of a truck for weekends etc though it would be a Tundra (Toyota). Toyota Tundra Texas Edition is particularly sweet.
Warwick – good and valid quesion. I am not a farmer/tradesman but I do own a cottage about 30 minutes from where I live. I am always hauling something to or from the cottage so I decided I needed a truck. Now I did not buy a truck as a second vehicle. It is the only vehicle I own (other than my Harley). You know the saying “you should own a truck or a friend who has one.” I AM the friend who has one.
Dammit Me N D, you’re not playing fair!
I wanted you to suggest an alternative use for the money and then I was going to point out we could have a vote on the uselfulness of the Chrysler spending.
You may have also forgotten/not known that this famous govt loan allowed Chrysler to give the world the first, taaa daaaa, MINIVAN.
And you would have lost because all the soccer/hockey/baseball/tennis/everything Moms (bless them all) of North America would have voted massively for the van.
But seriously, I fully support and vote for small and frugal govt. The less the govt spends as a total of the national economy the freer the citizens are.
Luckily in Canada we (along with the IMF) were able to beat some sense in the feds about Canada’s total govt debt load bomb, that approached $900 billion, and they started slimming down in the mid 90s.
Cut the hell out of healthcare but financed the gun registry and Adscam – what a perverse value system!
Now the Canadian govt is in a very good position to help the economy thru the muddy road ahead with some judicious spending.
Canadian conservatives can stand up and take a bow over that one.
I wish that people who do not understand the “workings” of a business would take the time to learn BEFORE they spew their nonsense
when factoring labour cost for comparison you use only direct manufactoring costs, over head is a different matter
and when considering these direct labour costs, one must also take into account productivity and quality. Quality could mean a defective rate that brings the cost of production up due to rejects. These rejects at chrysler in brampton are scrapped because it cost to much (because of unions) to repair. These costs are often “hidden” in overhead
and as far as one poster claiming about the HARD work. I’v had one of the 3 bigs as a customer, and have yet to see anyone in there work, PERIOD!!!!!!
If these jokers get there way. Some day we may end up putting wreaths on monuments to the victims of these Wolves. Evil knows no shame. Id she doesn’t show up you know someone high up put the kybosh on this little exercise in propaganda.
Perfect idea Ezra. You just may have scared her away. Will be sending some more money, just takes time is all ,to save.
Chesswiz, thanks for the feedback. I didn’t mean to just focus on teachers but they are a blatant example of how escalating public sector union wages continue to soar in a time of economic crisis. Teachers take courses primarily to make more money though they are in most cases unrelated to their job, just padding the CV.
Whereas there will be a market correction for the unionized auto industry and they will adjust or die the public union’s greed seems to know no bounds. York University staff are on strike demanding 11% over 2 years and could care less that tuitions are soaring or students may lose their year, I want mine now.
As noted before, McGuinty has hired 41,000 public employees in the last year alone. An article in today’s Sun covered a restaurant owner that I patronize complaining about countless inspectors and myriad paper work to achieve compliance with scads of red tape, taxes of over $400,000, 10 times what he takes home before his own taxes. As Tom Zoras, the owner, states “I am essentially a civil servant with no benefits or pension.”
This overregulation will destroy small business. It is a reflection of too many government employees, each with a large salary, benefits and a huge pension feeding on the wealth creating side of business and consuming that wealth through make work jobs.
As a former director of payroll and human resource systems for the Oshawa Group, a former large national food company, responsible for a staff of 42 people and a payroll of $350 million I earned not much more than a teacher made at the time, just a few years ago with nothing like the benefits and pension. We worked the nights, Christmas, T4s, whatever it took to meet our deadlines.
I had a great staff and enjoyed the job but a good friend who worked for the City of Toronto retired at 53 with a 70% pension, fully indexed and took his last year off fully paid for by his accumulated sick days and vacation time. Who pays for this, you and I do in our taxes. The question is for how long can declining private industry squeezed by the reality of the marketplace continue to fund this?
GYM said, “as far as one poster claiming about the HARD work. I’v had one of the 3 bigs as a customer, and have yet to see anyone in there work, PERIOD!!!!!!”
What part of the plant are you in? You do realize how ridiculous that statement sounds? I can only speak for my plant, but everyone has a job. It’s the whole thing. The shiftwork (I’m not complaining, but everyone knows shiftwork impedes good health). Repeatitive work is inherently stressful. Strain injuries are very common, especially as the plant community ages. I could go on, but the point is, the public perception of the autoworker as “have yet to see anyone in there work, PERIOD!!!!!!” is largely simplistic. As in any workplace, their are exceptions, but the vast majority of canadian autoworkers are hardworking and loyal. Bailout or no bailout, I will survive. I really don’t care. It would be easier for me to finish out my worklife within the auto industry, but I’m prepared to move on, just like any other worker. I just want to clear up some facts. A factory doesn’t churn out a quarter million vehicles a year without hard work.
The problem with the car industry is they have totally over complicated the product based on stupid consumer demands. They are too heavy, to ineffienct, and way too expensive and their value drops like a rock once purchased. What kind of logic says somebody should be spending 30K plus (x 2) to drive kids to soccer and pick up groceries and get to work. People live such crappy lives revolving around paying for car loans, insurance, gas and maintaince.
My solution, ride a bike to work, drive and old car in town, and rent if a go on a long road trip and when I want to go fast, dust off the 82 750 Katana. For the wife, a basic Honda Civic.
Bye, Bye, big 3.
Didn’t mean to get the defensive going there, Warwick. GM and Ford produce small cars for the European market which are entirely appropriate for Japan. But that’s actually not the point. People in Japan buy Hummers but they have to move heaven and earth to get them because of the restrictive government import laws. Same thing with North American agricultural products. If foreign nationals want to sell over here, my neighbors sure as hell better be able to sell over there. In the meantime, does the phrase “engine sludge” have any meaning to you?”
And TCanuck, better check the gas mileage on your Tundra prior to purchasing. My Avalanche hauling the better half’s Victory gets about 5 MPG better. Now there’s advanced technology.
Chazz at 3:04 AM
tho I was not in the main production area, I counted over 60 heads before I stopped counting
and I will say it again, I did NOT see one person working
on other visits I saw some people doing things to look busy ,explained to me by one of the people I was there to see
now as to who I am
I’v completed my Industrial Eng coarse, I travelled all over NM and CM as a sevice tech, and have had my own bus. as well as worked at 50+ jobs, so I’v gain enough insite & experience to be able to observe and asses such things
in my experience I’v seen so much “trouble” caused by employees who are protected by unions, and they, not those who work, set the standards that ruin companies. I for one would not work in a auto plant, nor would I work again in a union enviorment
and chazz, I kno several who work at honda in alliston, whole different ball of wax
I don’t get it. You paint a picture of a complete fool’s paradise Jim. That’s just not accurate at all. Splain to me how a quarter million vehicles a year potentially leave the plant, when not one person works? You just sound angry to me, almost bitter.
Bought my first Honda in 1982. Haven’t looked back since. Currently an ’07 Civic that runs a treat. And it’s made in North America. Having lived in an auto town for several years, I can tell you these guys aren’t starving by any means. Laid-off workers get a top-up to 90%
of their salary and benefits include legal plan as well as medical, dental etc. CAW effectively runs the company. My prediction is the domestic auto industry is going to go the way of the Brits.
Phantom, I was raised a Ford man, but the only new car I bought was a 71 Camaro z28 (4 spd 4.10 rear heh). And I drove Volvos with fuel injection long before most people had even read about it.
Before that I also had a Porsche 1600 Super and a TR3, so I am a free thinker on autos.
But the fact remains that Detroit fell behind after Nader put the kibosh on Detroit innovation by going after GM over their first Corvair (I also had a 65 Corvair Corsa with the good suspension heh).
I also like cars I can fix but we are dinosaurs in the world today. Luckily most cars in general today are so superior to our older stuff it is unreal. Both Detroit and the furreignners deserve kudos for that.
Do all of you pick-up drivers live on farms or do you just enjoy spending more on gas than food each month?
What the hell use is a pick-up truck on a day-to-day basis if you aren’t rural (or a tradesman, etc.)?
Do all of you pick-up drivers live on farms or do you just enjoy spending more on gas than food each month?
What the hell use is a pick-up truck on a day-to-day basis if you aren’t rural (or a tradesman, etc.)?
Chuck, it is hardly my fault if you don’t like the results obtained by using the Big Three’s numbers. THEY say their costs are $73.20 per hour, and THEY say it takes almost 24 hours to build a car. If you think the result is incorrect, do the math yourself. IF you STILL don’t like the answer, your problem is with the data and that, amigo, is not supplied by the union. Those are facts, no matter how much you whine about it or pretend to be a financial wizard. As I said before, if you eliminate the labour cost completely, the cost of a vehicle is reduced by less than $1800 dollars. I’ll tell you what: you tell me how much YOU think the labour cost is for an average Big Three vehicle, if you really believe that Toyota has a $3000 cost advantage per vehicle.
Here’s an article regarding labour costs of GM and Toyota:
http://www.financialweek.com/apps/pbcs.dll/article?AID=/20071008/REG/71004020/1001/TOC
Reality is that the US bailout, now up to $75 Billion, will mostly go to selling the existing inventory of cars at firesale prices. After that’s done, the Big 3 will declare bankruptcy because their products will not sell in the current situation.
It’s over .. nobody is going to invest in a big, overpriced yank tank because it has no resale value, and you can’t expect to keep running it after the manufacturers finally go bankrupt. Would you ‘invest’ in a Cadillac knowing it’s going the way of the dinosaur?
WTF did you think was going to happen with the Billion$$$ of bailout money … the rebirth of the Detroit Big 3 …???!!!
This could be very significant going forward;
[Now that it has negotiated a new labor contract with the United Auto Workers, General Motors has shrunk its labor cost gap with Toyota down to $800 per vehicle.
Just two years ago, that gap ran as high as $4,000 per vehicle, said Dave Cole, head of the Center for Automotive Research in Ann Arbor[Financial Week
Who knows, but at $4 bucks a share, we may look back some day and say; Boy was I stupid. The Engine and tranny lines alone were worth $40 bucks a share.
8 years ago, $81 bucks
A year ago, $25 bucks
Today, a share can be got for less than $3 bucks.
Even if GM clawed back to within only a quarter of it’s peak value ($20), that would represent a gain of 700% from today !!
Moves like that is what make the rich, really rich. Think Buffet.
Finnbar,
You haven’t even begun to address my argument. If you do not believe that the 12.5% disadvantage comes from labour, please make a rational case for another factor that could explain the discrepency. I already outlined the 3 major cost components. Please explain how Toyota could have a 12.5% advantage from raw materials or energy.
Meanwhile, GM has improved its gross margins from -0.6% (yes it actually lost money on each car it sold in the US before factoring in SG&A, depreciation, interest and taxes) in 2005 to 2.8% in 2007. How did it do this? Well, part of it is $9B in advantages from cutting costs from labour. That’s 5% of revenues. GM also estimates that its labour costs represent 30% of sales in 2007. It hopes to cut this to 25% by 2010. GM’s recent health care settlement with the union cut 1.1B in costs alone. Where did I get this info? How about simply reading the annual report? Apart from the auditors, thousands of analysts pour over these numbers to make sure they are correct. Lying on a 10-K amounts to fraud, and eventually these types of lies come to the surface … think Enron.
BTW, I don’t know what you do for a living, but you obviously have no clue how to analyse a company’s financials.
one word for the mess
UNION!!!!!!!!!!!!!!!!!!!!!
Ummmm … Ron … Buffet only buys stable businesses with great managements and great track records. GM is trading at $3 because it is about to run out of cash. It only has two ways out, finance itself with debt or equity. Since banks are not going to lend, it is safe to say equity would be the only option. If equity is used, current shareholders will face massive dilution and hence lose almost everything. If the company goes into receivorship, then the bondholders will have first dibs at the assets and you can bet there will be a fire sale. Either way, there are tons of great firms trading at outrageously low valuations … stay clear of GM.
Warwick, I buy big American trucks because I can, Chevy Avalanche, Silverado, Lincoln pick up, and Cadillac SRX V8 AWD. Why the hell not. While I live in an agricultural area, the only time my vehicles go off road is when I lose momentary control. Mind your own business and enjoy yourself in the rice grinders.
The Japanese manufacturers have gotten a free ride in the U.S. building facilicities with huge state benefits and no legacy overhead. In Japan, U. S. manufacturers can barely get through the red tape to establish mere showrooms. Similar to our beef and rice producers they have mammoth protectionist restrictions on foreign products. Some ally.
In the meantime, I buy my vehicles based on what I know, not what Catie Couric said on the news. My Dad was always a Ford man until I turned him to the “dark side” with GM. He owns two GMC Yukons and a GMC “Jimmy.” The Jimmy is the ranch truck and so only has around 220,000 miles. The two other Yukons do “road duty” and so have well over 300,000 miles. Neither has ever had any work to the 4WD or the motors. Actually, the 2001 turned over 300K this past Spring. Don’t tell me about Japanese quality. There is some fact in the reputation mixed with a lot of gullibility. I’ve been driving Fords or GM products, one Jeep Wrangler Sahara, since the ’70s. I don’t need either hand to count problems because there haven’t been any. AND, I thrash my vehicles. The Big 3 provided jobs, housing and college to millions of Americans over the decades. I for one would rather bail out those jokers than hand money over to smart ass venture capitalists who weren’t as smart as they thought they were and in any case should have known better.
The labour costs in a big 3 vehicle accounts for only 7% of the final price. Canadian autoworkers could work for free and it would change nothing. Working in an assembly plant is very difficult. Yes, I work in one, and I can honestly tell you that I do not feel overpaid. There is no real quality gap betwwen the big 3 and others. Only a percieved gap. The plant I work in uses 17 man hours to build a vehicle – better than all the japanese plants. Our quality is second to none and always getting better. The vitrol in this thread (and others) toward the autoworker is unjustified. The canadian autoworker is the world’s best and getting better. This industry is definitely worth saving in my opinion. I am not a bloviating, loudmouth union lardass. Sure there are those, but they are generally ignored. We know what’s going on around us and have always been willing to change and compromise and improve to survive. Being a lifelong conservative is difficult in a union shop sometimes, but the union hard ons are increasingly being marginalized and ignored. Please stop dumping on the canadian autoworkers. We are smarter and harder working than most think. It is a vibrant industry that finds itself in the crosshairs of a serious situation. We will recover and continue to make vehicles second to none for a very good wage. What’s wrong with that? The claim that productivity suffers with every new collective agreement is simply not true. Productivity in the canadian auto indrustry is the best ever and getting better.
While there have been bailouts in the past that have worked (Lee Iaccoca Chrysler)
Posted by: rockyt at November 11, 2008 10:12 AM
Well, rockty, not to go all ideologically pure on you, but “worked” is questionable. Read some Frédéric Bastiat, esp. about the “what is seen vs. what is not seen”. To wit, you can’t know this ‘cos you don’t know what productive use this money could have been put to had it not been expropriated by the government.
That Crysler continued as a commercial enterprise does not prove that the bailout “worked”.
ok4ua I don’t get the point of your question. Whatever Kate’s gross family income is is hardly relevant here. We are not saying that there are no people who make more than Big 3 auto workers (certainly we all know about teachers, public servants, bus drivers . . . they all take home a pretty good buck.) The point is that in comparison to the average hourly wage, Big 3 auto workers are clearly way beyond the average. This tends to be the case with most union shops. The result is a two-tier universe — union workers and then others (many small business people). I think in view of this it is necessary to make some judgments about whether or not union concessions re salaries are appropriate if there is to be a bail out — or even whether or not a bail out is warranted. Funny, I have also noted that some among the most wealthy and priveleged of these well-paid union groups are also staunch NDP supporters (lots of teachers, univer. profs, etc.) — so much for “social justice”.
Charles, I agree. I used GM as an example how of this deep downturn could, could be a huge buying opportunity – even with a poorly run company as GM, Ford ect. (panic may, may have driven it lower, much lower than fundamentals would suggest.
I also agree, the stable, well run companies are the ones to hold today. They have been collateral damage in all this. (Proctor ? J&J ? Wells F ? Power Corp ? Genentech ?)
iowavette,
lol. well, if you want to piss away your money on gas, go right ahead. I will always have better things to spend my money on.
You did hit on a huge portion of the big-3-dino’s problems though. It’s the “legacy overhead” combined with bad engineering and a shoddy product which will sink them.
If you haven’t had your GM’s in to the shop much you must fix them yourself. My mom drove a Yukon Diesel and it was in the shop so often she was happy to be rid of it. My first car was a ford. It was my last ford. In my family, the GM’s and Fords have all sucked and the Hondas and Toyotas have been faultless. You can whine about it being “anecdotal” all you want but you go with experience. My current Honda was built right here in Canada and I my best friend just moved from Dana where he worked in a now defunct unionized truck frame plant (F150 frames) to the new Toyota plant. They provide plenty of jobs here.
As for the “big-3” not being “let into” Japan, I can’t see why anyone would want to try. The Japanese buy mostly small cars. In case you didn’t notice, there isn’t much room in the average Japanese city so if you drove a chevy half-ton you’d have a half-ton worth of paperweight while you sat stuck in traffic you can’t get through. There isn’t any demand there for the crap GM or Ford makes. They only people who buy big vehicles there are the rich who tend to favour Mercs and BMW’s to Lincolns and Suburbans.
Chuck,
Why do you refuse to address what I’ve said? Let’s continue, shall we? YOU say that GM says labour is 30% of its sales for 2007…fair enough, let’s use that figure. With 266,000 employees and 30% of 181 billion dollars, they now claim that each employee “cost” them about roughly $212,000. Since they didn’t pay me anywhere near that amount, the rest must have gone into funding my pension fully………oops, wha’dya mean my pension is underfunded? I do not know what they do with the money they earn but labour is hardly where it goes.
You seem quite willing to take their word for what the figures are, so much so that you convince yourself that auditors get to see the real books. You tell Ron that Warren Buffet wouldn’t buy GM because it is poorly run but then you have profess faith in their auditing process? Let’s make it real simple: if GM wants to get public money, the government should get unlimited access to their books. And if you think that will ever happen, I’ve got some very valuable GM stock to sell you.
finnbar
As an economic illiterate, I would not expect you to understand these things.
But you did hear that labour costs for the companies include RETIRED employees as well as those currently working?
In other words, the pensions, health benefits/drug costs, etc. have to be included.
I also bet you didn’t know that the retired employees cost MORE per year than those actually making their product?
If GM shut down today, tomorrow’s labour costs would still be huge.
Warwick asks(somewhat heatedly I must say): “What the hell use is a pick-up truck on a day-to-day basis if you aren’t rural (or a tradesman, etc.)?”
1. It will shrug off a direct hit from a minivan, and survive one from a transport truck.
2. You can put a 4×8 sheet of plywood inside where it won’t get rained on.
Try that with a Honda Civic.
The money I save on gas by driving a small car is no good to me if I’m dead. Being in the medical rehab biz, I’ve met a lot of people who’ve been smashed to crap in car accidents. This has left me with a profound need to have lots of mass on my side of the crash equation. I happily pay for the gas to haul all that mass around.
If I was poor, I’d drive some ancient barge like I used to when I was a kid. 1978 Olds, baby. Big like a mountain, nasssty like barbed wire. Nobody EVER cut me off in that thing. Same with the Pontiac. Same with my truck these days. The morons fear the big iron.
Conversely, every single time I drive my smaller car somebody will cut me off, tailgate me, or pull some other stunt. My driving style doesn’t change, just the size of the vehicle.
Big is good. Small, not so good. This is the Phantom Theory of Vehicles.
“2. You can put a 4×8 sheet of plywood inside where it won’t get rained on.”
1-How often you do drive around with plywood?
2-do you drive around with plywood more often because all your friends and family know you have a pick-up?
As for the size vs. survivability, engineering wins over mass and with a smaller car, if you aren’t an incompetent driver you can manoeuvre easier so you don’t get into an accident.
I’m not saying don’t buy what you want. I don’t care if you blow your money at the track. I’m just saying it surprises me how many people waste good money on pick-ups they don’t need. But to each their own.
Kill the corporate welfare fatted calf. Since when do tax dollars go for incompetence at business? To continue to make a lavish lifestyle for bums. The Unions have become a burr under the saddle of regular workers. Teachers unions I recon to be the worst for political & economic blackmail.
The result of this socialization has been poor productivity, the loss of any real democratic Unions to user abuser mooches, who take from peoples checks with avarice, since they can’t work a real job. Presidents for life. Money for nothing & there homes for free , including cars. Frankly I see little difference in both these organizations leaders.
If where to pay these losers at least give us some stocks as compensation.
Spend some money in worker education. Inspection systems. Make the product well, not based on old models, but sound engineering as America was famous for with Canada. A low dollar made us lazy, sloppy & stupid for handing con men our lives out of expediency. We l noticed the price4s for cars did not go down when we equalized our dollar with the US. It took months until even the press figure3d it out. Gouging your customers can make money in the short term. Kills you with a bad rep. When the Canadian dollar went lower it was not 10 hours before they raised prices back to 40 cents on the dollar. Who needs these crooks. The3 same could be said for furniture companies & the rest including oil. I notice as usual between 20 & 10 cents less a liter in the EAST. Nice to know where being buggered that way as per usual by Easteners. Is there not one business, or bank, including the government in this Nation that doers not rip off its own Majority of peoples, by gouging with over taxation, high absurd prices or just plain theft?
JMO
Let’s get something clear. I do not believe GM should get any public money. Governments should never own companies because inevitably decisions become political and not economic If they do, I firmly believe management should get fired and the union canned. Management should have never caved in to the union.
Have you ever heard of the job bank? GM actually has to pay ex-employees 90% of their salaries even after firing them. Furthermore, GM has to pay insanely generous retirement benefits to past employees. So your formula does not work. It is simplistic and ignores reality.
I again will restate my position. How do you explain the EBITDA margin difference between GM and Toyota?
And another thing. GM is a poorly run company. But auditors are independent. Auditors must audit good and bad companies. What’s your point?
Chesswiz and Warwick, I meant to say at the end of this contract just signed. According to the Toronto Sun the high wage would be 94K with the median one being $83k. This is an incredible wage for 158 days of work.
Chesswiz, don’t be to sure that teachers would do just as well in the private sector. My wife, who was a director at one of Canada’s largest accounting firms, worked in Human Resources and interviewed many teachers at a downturn several years ago. They were in such a huff when she said you have few marketable skills for business with a degree in history or fine arts. As noted by many posters here these degrees mean little in private industry and many businesses are loath to hire former teachers as they come from a heavy, heavy union environment with all sorts of entitlements and attitudes. Check Dion out as an example!
Robert W. wrote: “It would be fascinating to show poll respondents the graph and then ask them whether they think the autoworkers should be bailed out with our tax dollars.”
The only way that the masses are going to become aware of this massive, potential tax liability is if people like us make them aware.
Copy and past the graph and title and comments provided by Kate (with attribution on course) and paste them into your Outllook or other e-mail program. Then send them to everyone in your address book and ask them to forward it to everyone they know.
Otherwise, with Ontario putting heat on Stephen Harper, it’s going to be a done deal and we’ll all be back in deficit territory again.
One other thing to be aware of with the Big 2.5 is the public’s perception of long term viability. If the potential buyer of a GM or Ford feels they may not be around in a few years they may be reluctant to purchase the vehicle and the tipping point would have been reached. This happened as mentioned to the English car companies and they all disappeared.
Actually Me N D, you have a good point about opportunity cost.
But the reality is that if Chrysler borrowed the money at the going rate, and paid it all back (ahead of time even) which they all did, then nothing was lost by the govt. In fact, comparing the Chrysler loan to the pathetic record of Cdn govt loans not being paid back ever or token repayments at best, it was a excellent investment for the US gubmint because a local company kept local people employed for another 20 years and they got all their tax dollars back.
And that’s all anybody else could have with the money at the time also.
Of course if you can show exactly where this same money was asked for by somebody else at the time and the exact noble purpose they were going to use it for, then maybe we can further discuss Bastiat’s/your theoretical side of the question.
Chazz said: “I can honestly tell you that I do not feel overpaid.”
That’s a first. A union worker who feels he’s not overpaid! Keep that one for the archives.
Dave, the numbers are fishy again. I assume you meant teachers work 185 days, rather than 158? Still doesn’t sound like much, I suppose, if you’re not in the profession — and not aware of how many evenings, weekends, and holidays are spent on the preparation and follow-up required to do the job properly. Then there are the additional qualifications courses taken at your own expense during summer “holidays.” For those teachers who DO dog it, well, like Warwick and his wife, I have a lot of sympathy for the idea of getting rid of them, and no patience at all for the unions that defend their incompetence.
Yes, the max. in 4 years time will be about 94K. That will be earned only by those teachers with maximum experience in the top pay category. I don’t know how the Star could claim to calculate a median, since that would require knowing how many teachers are employed, and what they each earn — which I doubt the Star does. I’m guessing they just picked a big number from what looked to be about halfway up the grid. And even if 83K will be the median in 4 years, that means half of all teachers in the province are making less than that — many of them a lot less.
Re: private sector jobs: point taken. I didn’t mean to suggest that any old teacher could simply walk in to any private sector job they wanted; I’ve known more than a few I wouldn’t hire to walk my dog. A more accurate way to put it would have been to say that a comparably educated professional in the private sector has the potential to make vastly more than a teacher ever will — one of the reasons fewer men have chosen to enter the profession in recent years, especially in the elementary division.
Correction: I meant “the Sun,” not “the Star.”
rockyt at November 11, 2008 5:21 PM
Well, rockyt, I DO confess that I had forgotten that the Chrysler bailout was a loan at market rates which was paid back before the deadline. Nevertheless, I’m still squeamish about risking taxpayers money on a gamble which may well not have paid off.
If it was such a good investment for the gubmint why not for private lenders? Also, I’m uncomfortable that CEOs even see this as an option, and even in the form of a loan it does create moral hazard.
But you’re right, my reference to Bastiat may not have been quite apt in this case.
On the subject of Bastiat’s “what is not seen” it is quite amazing how many economists fall for the fallacy. Recent Nobel laureat, the moonbat BDS sufferer Krugman opined that there was a silver lining in the cloud of 9/11 vis-a-vis the economic “stimulus” of rebuilding. The “broken window fallacy” I think Bastiat called it.
Wading into the war of experiences with vehicles, I can tell you after six years of renting vehicles instead of owning one, you get more bang for the buck with a toyota, honda, mazda, etc than a North American model. Even comparing a North American model, say Mazda Protege to a Mazda 3 built overseas, there is a difference, although not as blatant. Early rice burners did have issues with Canadian winters and roads in the early years (had a Hyundai and a Honda back in the 80’s) but they adapted and improved the product to the point that I’d rather not get a North American model.
And for the record, I was and always will be a pick up truck guy (’66 GMC) but now drive a Mazda 3 on a daily basis. It is fantastic on gas and parks great but I have trouble taking a plasma tv or sheet of drywall home, not to mention no trailer towing. If I had the luxury of a truck for weekends etc though it would be a Tundra (Toyota). Toyota Tundra Texas Edition is particularly sweet.
Warwick – good and valid quesion. I am not a farmer/tradesman but I do own a cottage about 30 minutes from where I live. I am always hauling something to or from the cottage so I decided I needed a truck. Now I did not buy a truck as a second vehicle. It is the only vehicle I own (other than my Harley). You know the saying “you should own a truck or a friend who has one.” I AM the friend who has one.
Dammit Me N D, you’re not playing fair!
I wanted you to suggest an alternative use for the money and then I was going to point out we could have a vote on the uselfulness of the Chrysler spending.
You may have also forgotten/not known that this famous govt loan allowed Chrysler to give the world the first, taaa daaaa, MINIVAN.
And you would have lost because all the soccer/hockey/baseball/tennis/everything Moms (bless them all) of North America would have voted massively for the van.
But seriously, I fully support and vote for small and frugal govt. The less the govt spends as a total of the national economy the freer the citizens are.
Luckily in Canada we (along with the IMF) were able to beat some sense in the feds about Canada’s total govt debt load bomb, that approached $900 billion, and they started slimming down in the mid 90s.
Cut the hell out of healthcare but financed the gun registry and Adscam – what a perverse value system!
Now the Canadian govt is in a very good position to help the economy thru the muddy road ahead with some judicious spending.
Canadian conservatives can stand up and take a bow over that one.
I wish that people who do not understand the “workings” of a business would take the time to learn BEFORE they spew their nonsense
when factoring labour cost for comparison you use only direct manufactoring costs, over head is a different matter
and when considering these direct labour costs, one must also take into account productivity and quality. Quality could mean a defective rate that brings the cost of production up due to rejects. These rejects at chrysler in brampton are scrapped because it cost to much (because of unions) to repair. These costs are often “hidden” in overhead
and as far as one poster claiming about the HARD work. I’v had one of the 3 bigs as a customer, and have yet to see anyone in there work, PERIOD!!!!!!
If these jokers get there way. Some day we may end up putting wreaths on monuments to the victims of these Wolves. Evil knows no shame. Id she doesn’t show up you know someone high up put the kybosh on this little exercise in propaganda.
Perfect idea Ezra. You just may have scared her away. Will be sending some more money, just takes time is all ,to save.
Chesswiz, thanks for the feedback. I didn’t mean to just focus on teachers but they are a blatant example of how escalating public sector union wages continue to soar in a time of economic crisis. Teachers take courses primarily to make more money though they are in most cases unrelated to their job, just padding the CV.
Whereas there will be a market correction for the unionized auto industry and they will adjust or die the public union’s greed seems to know no bounds. York University staff are on strike demanding 11% over 2 years and could care less that tuitions are soaring or students may lose their year, I want mine now.
As noted before, McGuinty has hired 41,000 public employees in the last year alone. An article in today’s Sun covered a restaurant owner that I patronize complaining about countless inspectors and myriad paper work to achieve compliance with scads of red tape, taxes of over $400,000, 10 times what he takes home before his own taxes. As Tom Zoras, the owner, states “I am essentially a civil servant with no benefits or pension.”
This overregulation will destroy small business. It is a reflection of too many government employees, each with a large salary, benefits and a huge pension feeding on the wealth creating side of business and consuming that wealth through make work jobs.
As a former director of payroll and human resource systems for the Oshawa Group, a former large national food company, responsible for a staff of 42 people and a payroll of $350 million I earned not much more than a teacher made at the time, just a few years ago with nothing like the benefits and pension. We worked the nights, Christmas, T4s, whatever it took to meet our deadlines.
I had a great staff and enjoyed the job but a good friend who worked for the City of Toronto retired at 53 with a 70% pension, fully indexed and took his last year off fully paid for by his accumulated sick days and vacation time. Who pays for this, you and I do in our taxes. The question is for how long can declining private industry squeezed by the reality of the marketplace continue to fund this?
GYM said, “as far as one poster claiming about the HARD work. I’v had one of the 3 bigs as a customer, and have yet to see anyone in there work, PERIOD!!!!!!”
What part of the plant are you in? You do realize how ridiculous that statement sounds? I can only speak for my plant, but everyone has a job. It’s the whole thing. The shiftwork (I’m not complaining, but everyone knows shiftwork impedes good health). Repeatitive work is inherently stressful. Strain injuries are very common, especially as the plant community ages. I could go on, but the point is, the public perception of the autoworker as “have yet to see anyone in there work, PERIOD!!!!!!” is largely simplistic. As in any workplace, their are exceptions, but the vast majority of canadian autoworkers are hardworking and loyal. Bailout or no bailout, I will survive. I really don’t care. It would be easier for me to finish out my worklife within the auto industry, but I’m prepared to move on, just like any other worker. I just want to clear up some facts. A factory doesn’t churn out a quarter million vehicles a year without hard work.
The problem with the car industry is they have totally over complicated the product based on stupid consumer demands. They are too heavy, to ineffienct, and way too expensive and their value drops like a rock once purchased. What kind of logic says somebody should be spending 30K plus (x 2) to drive kids to soccer and pick up groceries and get to work. People live such crappy lives revolving around paying for car loans, insurance, gas and maintaince.
My solution, ride a bike to work, drive and old car in town, and rent if a go on a long road trip and when I want to go fast, dust off the 82 750 Katana. For the wife, a basic Honda Civic.
Bye, Bye, big 3.
Didn’t mean to get the defensive going there, Warwick. GM and Ford produce small cars for the European market which are entirely appropriate for Japan. But that’s actually not the point. People in Japan buy Hummers but they have to move heaven and earth to get them because of the restrictive government import laws. Same thing with North American agricultural products. If foreign nationals want to sell over here, my neighbors sure as hell better be able to sell over there. In the meantime, does the phrase “engine sludge” have any meaning to you?”
And TCanuck, better check the gas mileage on your Tundra prior to purchasing. My Avalanche hauling the better half’s Victory gets about 5 MPG better. Now there’s advanced technology.
Chazz at 3:04 AM
tho I was not in the main production area, I counted over 60 heads before I stopped counting
and I will say it again, I did NOT see one person working
on other visits I saw some people doing things to look busy ,explained to me by one of the people I was there to see
now as to who I am
I’v completed my Industrial Eng coarse, I travelled all over NM and CM as a sevice tech, and have had my own bus. as well as worked at 50+ jobs, so I’v gain enough insite & experience to be able to observe and asses such things
in my experience I’v seen so much “trouble” caused by employees who are protected by unions, and they, not those who work, set the standards that ruin companies. I for one would not work in a auto plant, nor would I work again in a union enviorment
and chazz, I kno several who work at honda in alliston, whole different ball of wax
I don’t get it. You paint a picture of a complete fool’s paradise Jim. That’s just not accurate at all. Splain to me how a quarter million vehicles a year potentially leave the plant, when not one person works? You just sound angry to me, almost bitter.