40 Replies to ““Have the powerful union bosses volunteered””

  1. It is interesting but all the commentary, on all media talk shows, says not a word about The Unions.
    Instead, the consumer is blamed for originally wanting ‘gas guzzling cars’. Then, the consumer is blamed for NOT wanting these gas guzzling cars produced by the Big Three.
    The Americans are blamed for, well, for being American. Oh, and for setting up plants in foreign countries.
    But not a word about the real reason for the problem, the fact that the auto industries unions with their enormous wages, pensions, benefits, creating an elite sector of workers, has effectively increased the costs beyond the capacity of most people to purchase.
    When it is mentioned, the unions immediately paint themselves and their workers as ‘the hapless poor’, ignoring that unionized workers make wages and benefits that put them in the level of an aristocracy and refuse to lower their wages.
    They expect the ‘govt’, yet another false name, for the government is really the taxpayer – they expect the taxpayer, those workers without those benefits and pensions, to support them.
    No way. Fire. Them. All.

  3. The unions expect the clerk at the 7/11 to give up part of his pay cheque to subsidize the union guy who makes five times as much.
    I don’t think it’s going to fly.
    The unions are out of touch as usual.
    And ET is right, there is not a peep out of the media on this while they never fail to mention the big CEO salaries.

  4. Shoot. Don’t even have to read the article to know the answer is a resounding NO.
    Fire.Them.All

  5. I saw a talking head, female variety, from the CAW, claiming that employee costs only account for 7% of the cost of a new vehicle.
    She also said it with a straight face.

  6. First of all, I believe that as recently as Oct, sales were still strong in most parts of Canada. We laboring taxpayers have already been pulling our weight, thank you very f**king much.
    Can anyone else here imagine the Michigan 3 worrying about saving Canadian”s jobs when they have US politicians to suckhole to for their own survival? Any offer we can afford to make will probably be pointless anyways.
    Things are different for the US feds who have little choice but to keep the massive employment this industry provides fueling the economy. Then, I ask, what will these “guardians of free enterprise” do in turn for foreign manufacturers operating on US soil? Maybe the media is filtering my messages again, but I don’t here them crying. Just maybe, it’s because they have been busy selling vehicles people want to buy.

  7. Apparently the labor cost of a car is 7% of the total cost. I don’t think wages are the problem. The design and fuel efficiency are the reason Detroit lost market share. Let the Big 3 go under. Japanese Plants will absorb the workforce.

  8. This “bailout” is in essence forcing every taxpayer to buy a Ford/Chev/Dodge without the added burden of having to provide them with an actual vehicle.

  9. I want to buy cars made in Canada,I want to buy cars from my clients, but I have already committed $80,000 for my Avalanche and Equinox and thats all they are getting.
    The companies and the unions are equally to blame for this mess and me for continuing to support them. The party is over, no more bandaid money ,get the government away from the free market,socialism can lead to bankruptcy and I do not want it to be me!

  11. Regardless of the labour cost of producing a new vehicle,and even with the prices of new Dodge 4X4’s reduced from $40,000 to $26,000, very few people are going to risk high car payments with all the MSM screaming “Recession” from the rooftops. Drive by your local auto dealer, you’ll love the attention you receive now.
    I saw a news item on the auto industry a few months back, and one couple interviewed, man and wife, each earned over $80,000 a year, working on an auto assembly line. And they were crying that if their plant shut down, they’d be flat broke!
    These people had worked at the plant for about 15 years, and they apparently had NO nest egg, NO rainy day funds saved up!
    Each of them earns about double my wife’s wage as a nurse,and she’s exposed to diseases on a daily basis that scare the hell out of me, while they work in a nice, safe plant. My heart does not bleed for them.
    Mr.Harper, and all other politicians anxious to bribe their potential supporters with OUR money,WE,THE GREAT UNWASHED DO NOT SUPPORT AN AUTO INDUSTRY BAILOUT!
    Most politicians have lived off us through the good times, now it’s up to them to prove they’re great managers in tough times, and live up to their pre-election rhetoric.
    I think we’re in a lot of trouble.

  12. I agree that trying to bail out GM et al is a waste of time, but this has been coming for at least thirty years.
    I could be wrong, but I understand that the Japanese and Koreans have had free unfettered access to the NA market for a long time. At the same time GM etc have been extremely limited in what they can sell in those markets.
    People say that people in those markets wouldn’t want to buy NA cars, and that might very well be true. But with no access to those markets what would be the point of trying to design a vehicle for that market? GM has done very well selling trucks in this market for a long time and has made money doing it. If they had free access to the Japanese market this last half century, they could be now selling us the useless subcompact pisscutter that I can’t fit my kids and groceries in, which is apparently the type of vehicle that the Japanese favour, to us now.
    The one thing that our government can and should do for our car industry is demand free access to the markets that won’t let us in, or restrict the import of products from the countries that do it to us. Probably too little, too late but that is one thing that the government could and should do. Free trade has to be a two way street.

  13. Best line of the day on the auto industry was from Art Cashin, a contributor on CNBC business news this am.
    He said that the auto worker unions got so powerful years ago that when they demanded a $10/hr raise, the manufacturers would counter with a ‘we’ll give $5/hr and better health benefits.’
    Mr Cashin finished by saying roughly, ‘so now we have giant health care companies that happen to make cars as a sideline’.
    Say good nite Detroit.

  14. I was waiting for someone to mention my favorite unionist. Even Bob “Proven Failure” Rae makes an appearance in appointing Bob “Betty ” White to a board:
    To whit:
    Bob White plays a major role in the 1985 documentary film: ‘Final Offer’ by Sturla Gunnarsson & Robert Collision. It’s shows the 1984 contract negotiations with General Motors that saw the CAW’s birth, and split with the UAW. It’s an interesting look at life on the shop floor of a car factory, along with the art of business negotiation.
    http://en.wikipedia.org/wiki/Bob_White

  17. The auto workera and pensioners get free Viagra.
    How does that old union song go?
    “Solidarity forever,
    The Viagra makes us strong”!?
    The CAW says they will not make any concession.
    And they want the single mom waitress and the kid at the 7/11 to take a pay hit to bail them out so they can keep getting their big wages and Viagra?
    I love the optics of that!
    http://www.consumeraffairs.com/news04/2006/04/gm_viagra.html

  18. ldd:
    Very nice. The only thing missing from this whorefest with our tax dollars is Brian Tobin preening like some drunken longshoreman demanding that the Auto Industry be relocated to Newfoundland to help the unemployment problem. Which is a little like asking for the Seagram’s Distillery to be relocated to North Main and Portage to help with the Aboriginal population.

  19. Mel Wilde is wrong about this: “The Canadian taxpayer would probably approve of helping the big three if these people had a track record of responsibly conducting their affairs.”
    Because if these people had a track record of responsibly conducting their affairs, they’d be getting the money they need from customers gladly handing it over inexchange for the vehicles, and they wouldn’t need help from the taxpayers.

  21. The Jokes Write Themselves
    yep.
    Stan ROLF
    So many ways to go on that.
    Seriously, so they’d like their Viagra in billions of cash so they can continue to screw us, longer.
    🙁
    But, but, I didn’t get company pension, medical benefits, dinners, or a vehicle – just their bill for it.

  22. I don’t think the East Germans produce the TRABANT anymore as it is no longer competitive.
    http://en.wikipedia.org/wiki/Trabant
    Corporate welfare is killing the capitalist cat.
    Woof, woof.
    Reduce production, retool, produce more quality cars people will buy. Don’t let Honda and Toyata forever eat your lunch.
    BTW you don’t need VIAGRA to erect a vehicle!
    Cheers
    Hans-Christian Georg Rupprecht, Commander in Chief
    Frankenstein Battalion
    2nd Squadron: Ulanen-(Lancers) Regiment Großherzog Friedrich von
    Baden(Rheinisches) Nr.7(Saarbrucken)
    Knecht Rupprecht Division
    Hans Corps
    1st Saint Nicolaas Army
    Army Group “True North”

  24. It’s funny all this is happening right now. I am leaving Saturday to go to the local dealer to buy a new vehicle (my first in over ten years). Since I have been little we have always had a Ford or GM vehicle. So as I always do before making a big purchase I started examining all the vehicles from the various local places. From talking to friends and dealers the best vehicles are Honda and Toyota. The vehicles from the big three have worse gas milage, prone to more frequent breakdowns and at least $10,000 more then a new vehicle from the big three.
    I can’t wait to get my new Toyota. I wonder if the big three takeover will be as delightfully funny as Gung Ho.

  25. I don’t know what things are like with the CAW, but here in Detroit I hear lots about the UAW contracts. Last year the Union actually took quite a wage rollback for any new workers hired by the auto companies. I understand that new employees make 15 bucks an hour and benefits are slashed. This leaves the car companies furiously trying to buy out the old guard so they can be competitive in wages again.
    They also did some deal where the UAW was responsible for the retirement and healthcare costs of retired workers. called VEBA. All those who think the UAW folks need to get theirs should note that although some are still making their rediculous wage, the UAW’s day of reckoning has come and gone already and it was last year.

  26. The woman from CAW who said that Labor only accounted for 7% was correct but as usual she neglected to include some of the other associated costs that have to be accounted for. These include all of the people in the “job pool” and the associated health and pension benefits for retirees. When these two factors are accounted for the “labor” factor winds up at over 25% of the cost of production. This is disproportionate when compared to Japanese and Korean manufacturers who produce cars and trucks domestically. An excellent article that details just how out of touch these people are with reality.
    http://www.heritage.org/Research/Economy/wm2135.cfm

  27. Cookies, I share your sentiments, but the $10,000 figure? No way. Compare a Focus to a Civic to a Cobalt. A Tundra to an F150 to a Silverado.
    The Japanese cars, because of reliability and brand recognition, are no longer bargains. There are bargains to be found, but they are in the Korean manufacturers’ lines.
    The Americans are now producing pseudo-bargains because no one wants their vehicles. Yet, for some reason, they still pump them out regardless of sales figures, which leads to huge incentives to move them off the lot.
    I’m speaking as the owner of nothing but Hondas and Suzukis for the last decade, while my wife has had Ford SUV’s during that time.
    (FYI, I checked. A CRV 4×4 starts at 32K. An Escape, similarly equipped, is $27K. An Accord is $1,000 more than a Fusion… it goes on.)

  28. All of the above comments are valid and interesting. I read yesterday that Ford was about to sell a majority share of Mazda – maybe it should keep Mazda and sell itself…
    I spent a good part of the summer as a contractor at the CAW headquarters in Toronto. Does a union mentality exist in a union headquarters? Ohhhh yes, it certainly does – to an extreme that most consumers would never imagine.
    These dough-heads were so ‘shop’ oriented that when a bunch of signs were to be prepared for the Labour Day Parade, there were arguments over who would staple the cardboard to the 2×2’s and once that was done, who would be responsible for storing these now large encumbrances. Then there were the guys who rented the trucks to take these vast pieces of propaganda to and from the parade staging grounds – they wouldn’t carry all the signs – only ‘x’ number. It was a friggin unionfest of outrageously uncooperative behaviour.
    I was rather amused – except for the fact that the auto industry really does employ a great number of people that are not directly paid by the big 3,2,1…. (poof!)

  30. While I am certainly no lover of unions, I wonder what the taxpayers want them to do in order to make the big 3 profitable again? Cut the pensions of those retired? Somehow I don’t think that is legal and definitly not criket. Imagine retiring after a working career and then find out a few years down the road that someone has decided you don’t deserve what you were legally entitled (and paid into). I guess there is always a job at Mickey D’s if they allow walkers behind the counter.
    Company pension plans should always be run apart from the company and never be invested heavily in the company stocks or even that sector of the industry. Folks at Enron found that out the hard way.
    The big 3 need to seroiusly restructure and learn a few things from their foreign competitors. Observe, learn, adjust and adapt. Remember the early rice burners back in the ’70s? It was often colder inside than out and you drove with a hand on the wheel, another on the stick and another on a scraper. Lessons learned, today’s foreign cars are as toasty as any other.
    Until you can put a Honda Civic next to a Ford Frustration and not be able to tell the difference in performance, quality, workmanship, and reliability wise, there will still be trouble for the Three Amigos.

  31. Piss poor management and greedy, seedy unions
    Makes for a great business model.
    Let nature take its course.

  32. non jobs, real pay & benefits !!
    “One issue contributing to the UAW’s strike against GM is that negotiations reached an impasse regarding the future of the “jobs bank,” or what the Wall Street Journal calls “GM’s Anti-Jobs Bank, the company’s euphemism for a post-employment limbo in which GM pays laid off members of the United Auto Workers not to work.” As the WSJ points out today, it’s “Nice nonwork, if you can get it.”
    There probably isn’t a single issue that better highlights the problems facing GM and the UAW than the “Jobs Bank,” which they both agreed to in 1984. Here is what the WSJ had to say about it in a 2005 editorial “GM’s Anti-Jobs Bank”:
    If you want to know why GM’s costs are too high for the number of cars it sells, here’s one explanation – the Jobs Bank.
    GM doesn’t like to talk about the “jobs bank,” to the point that it won’t disclose how many idled workers are in the bank or even how much it costs the company. However, the Detroit Free Press has dug around and reported that the “bank” holds some 5,000-6,000 employees, at an annual cost of as much as $800 million a year. And that’s just the beginning of the damage it does. ”
    http://tinyurl.com/5lhbj2

  33. Brian M,
    Great link. I urge all to read it. This is the essence of the resolution to the problem going forward. The problem today is it isnt clear that they can bridgge their way to new future.
    As for the 7% of cost….maybe direct labour is 7%, not including benefits and the overhead associated past employees….this only highlights the problem. It means that each vehice generates cash but that cash has to pay for a far more than the other guys….example, your net takehome pay is the same as your neighbour, but your neighbour has a large home that they leave the windows open on in the windter and summer, run their air conditioning and heating at high levels, have expensive cars, eat out all the time, have high end cable subscriptuons, send their kids to private school….and yet these neighbours claim they are poor.
    Choices are, get a new job that pays more (ie sell more cars that earn higher margins (these were SUVS and Trucks) or cut your your luxurious overhead.
    So the VEBA mentioned in the article is the equivalent of the kids leaving home, allowing you to shut the windows, cancel some cable subscriptions, cook in rather go out and get rid of the private school costs. Problem is they arent moving out for a couple of years and they are demanding that you pay for the moving van and the first and last on the new condo.
    This is the way out, contrary to people saying that nobody wants to buy their cars, they sell lots of cars and trucks, just not as many as they used to. Combined the big three in NA still sell close to 50% of the vehicles in NA and 2 of the three have viable International divisions, there is a viable business in at least two of the three NA automakers (Ford and GM)
    The transition needs to happen faster, much faster. The strategic and critical element, for their to be ANY NA auto industry, is a the shared supply chain that ALL nabufacturers use, including the Japanese and German NA manufacturers. This employs far more people and geenrates more value. If this is saved then really what you are talking about losing are the assembly jobs and the design and product jobs…that isnt sooo bad.
    Nonetheless, the way out isnt a bailout, I would consider a loan to G to payout VEBA today with GM paying in 5 years. This accelerates the reduction in cost and quite frankly the health and pension problems land in taxpayers hands ultimately anyway.
    If not that then I do think the government guaranteeing financing while GM and Chrysler go into Chapter 11….based on the proviso that the suppliers feeding the manufacturers get paid…honestly, they have been squeezed and they are the efficient, non union, part of the value chain that makes up the auto industry.
    The surgery needs to be done at head office, the pensioners and assembly level labour contracts.
    What has ticked me off in this process is the auto companies havent demonstrated what the end point is, just shaken fear at everyone. If they were making an investor presentation the investor would ask, so I give you this money and in 5 years what do things look like, how will you be sustainable and on a growth path….even the most patient investor, and government can be the most patient (whether it should be is an other question), will want to know that the problem is fixed and their money has done its work. Those goals havent been ennunciated by the car companies.
    I will say there is one executve whose honest opinion I would love to hear, that is Mullaly of Ford. He has been there less than 2 years, he did an AMAZING job at Boeing. If there is one executive who understands how to run an American industrial eneterprise it is this guy. The question is have we heard his unvarnished opinion, or is he just playing along to help the other two.
    They arent too big to fail but it is time for the government and courts to do what only they can do, decide whose ox gets gored to feed the village.

  34. The big 3 complain about their costs. How much longer are they going to pound their thumbs with the hammer letting their genius management drive into the ditch.
    How much has GM spent developing the new 500 horse Camero? 400 horse G8. How about building a 60 mpg Malibu.
    How much has Ford spent building the new Flex worth 50 grand instead of building plants that would build cars similiar to what they sell in Europe.
    It was reported that Wagner and the boys flew to DC yesterday in the private jet begging for money, the jet, $20 grand a hop.
    In Calgary, the GM dealers have rows of Vettes, 4×4 trucks and SUVs sitting with their tires going square, and they is over a 5 week wait for a Vibe.
    A guess the MBAs missed the class on forecasting.

  35. Here’s what I’ve heard from union bosses. Some Grand Fromage union jerk was live on BNN last night, claiming as noted by many above that the “labor cost” of a GM vehicle was 7%, which is hardly anything, and all you Canadian taxpayers should f-off and stop blaming the unions!!! So shut it and fork over the dough to save the Big Three before we have to rough you up.
    As also noted above, maybe their hourly wage comes to 7%, but their total cost to the company comes in far higher. The bill for benefits is extremely high.
    One hidden cost which never gets mentioned is the “slave ship” mentality that pervades every union shop I’ve ever had the misfortune to be stuck in. On a slave ship, the rule is “don’t row”.
    Jobs are timed at a glacial pace, and if you go faster than the job time somebody will pull you aside for a quiet word. It takes (on average) half an hour to paint an entire door and door frame, both sides, with a paint brush. I’ve personally seen a union painter take two hours to paint one door. From what I hear, he was moving like lightning compared to what you see on an actual union job.
    Electricians do not carry ladders and laborers do not touch electrical equipment, as Brian M. noted so well. Laborers carry ladders, and electricians climb them. That’s why it takes two men to change a light bulb in a union shop. That’s not a joke, that’s reality at GM. You go to their factories and you’ll see $50/hr electricians screwing in light bulbs while the $20/hr laborer leans on the ladder. Sometimes two laborers if its a long ladder or there are many light bulbs to carry. Minimum $70 bucks an hour to change light bulbs.
    Safety regulations! I worked at the Royal Botanical Gardens in Hamilton a couple years ago as a painter on a private contract. I was painting the trim on a ticket booth, maybe 12 feet tall in the center and 7’6″ at the edge of the roof. I used a step ladder, obviously. The union filed a safety grievance because I wasn’t working on a scaffold with a safety harness. GM is no different.
    At Toyota and Honda one guy changes the light bulbs, jobs are done at a pace that doesn’t injure the workers but doesn’t put them to sleep either, and guys paint the trim without $10,000 worth of scaffolding being built. That’s probably a 10% cost saving right there.
    However my friends, as scummy, thuggish and downright loathsome as the UAW/CAW and public sector union attitude and behavior is, and as much as they are indeed dragging the Big 3 down, there is another problem which costs the Big 3 MORE. No, I do not mean management stupidity. Others have covered that, and to be fair the management is every bit as fubar as the unions.
    The big frickin’ elephant in the room here is GOVERNMENT. I do not have numbers, and I am no expert accountant. But I’d be willing to bet that something on the order of 40+% of the cost of a car ends up being due to tax.
    This would include direct corporate tax, direct labor related fees, taxes, contributions to CPP/UIC blah blah blah, taxes to all levels of government for land, environment, emissions, garbage, blah blah blah, and also the indirect taxes passed on to them from every company they buy materials and services from. Oh, and the costs imposed by complying with regulations from all levels of government.
    Funny that I don’t hear anybody talking about those costs in this equation.
    You wonder why GM became a bank that makes cars on the side, that’s why. Without the bank part spinning money out of thin air to offset all these union and tax costs, a GM truck would cost as much as a Ferrari.
    Sometimes I used to look at these huge companies and add up costs in my head, trying to imagine how the hell they ever turned a profit. I just didn’t get how they could, it didn’t add up. Now the truth finally comes out, they didn’t make any profit on the cars at all. They made money on financial derivatives created by the car loans and levered up at 40-1. The cars were just an excuse for the leverage. Now that’s all come to a crashing halt and these idiots are burning through $1+ billion a month because nobody can afford their stuff without a loan. Hell, without the loan and the leverage they can’t make money anyway. They’re pooched.
    You wonder why the Honda or Toyota costs more than the Chevy, its because they don’t have a financial derivatives business offsetting their costs. They have to actually charge you for the whole nut up front. That the Honda doesn’t cost $100,000 is due to no union, competent management, and mayyyybe a “special deal” kinda cozy relationship with two or three levels of tax collectors.
    Bottom line, I think (but can’t prove) that the whole edifice from union to company to government is as crooked as hell, and they’ve been scamming the life out of us since WWII.
    I say let the whole rotten structure collapse. Good chance to stomp on the friggin’ giant, cockroaches that scurry out of the wreckage.
    Here endeth the cranky rant.

  36. Gee Phanton, tell us how you really feel.
    I know I’ve been around for a heck of a long time but I seem to remember several “bailouts” of the auto industry already. They seem to be sandwiched between years that there are union contract negotiations and strikes.
    As I said before they have to go down in flames before re-inventing themselves as the new phoenix.

  37. For me, the bottom line is that any money for a bailout can only come from the taxes paid by those sectors of the economy which are productive and profitable enough to grow in their own right. Choking those sectors by creaming off their profits to feed the sinking hulks of the North American auto industry is a formula for deepening the existing economic woes.
    As pointed out above, investors would ask tough questions like “Why should I lend you this money and how will you use it to remodel the business and restore it to profitability?” Unfortunately, I’m not confident that governments, motivated by the political bottom line in the short term political quarter rather than the financial, will ask those tough questions. More than likely my taxes will simply be flushed into the hole of companies which will continue to make vehicles at a higher real cost than that for which they can be sold, due to whatever combination of union labour or corporate governance under which they labour.

  38. Can’t, Texas. Kate has her rudeness filter engaged, so the primal scream and the swearing kinda loses in the transmission phase.
    After I wrote this the giant Fools on the Hill down in Warshingtoon threw together some deal and the market spiked. Then it became apparent that they were a bunch of DemocRats trying to save face and there wasn’t a chance in Hell it would pass, and the market has taken another dump. The Dow Jones just closed at 7565 kids, but it bounced off 7505 a couple minutes ago. Tomorrow we could easily see 7400’s, no sweat. Guys on TV are starting to talk 6000’s.

  39. Anyone else too afraid to look at their RRSPs and investments? I know deep down that the markets will settle down and work the way they should but right now its like catching a ride with a drunk; all over the place but you dare not jump off until things slow down. What is the biggest danger, jumping or staying for the ride. Neither option enthuses me.

  40. The unions expect the clerk at the 7/11 to give up part of his pay cheque to subsidize the union guy who makes five times as much.
    Freeloading, Conservative voting, small dead farmers expect every taxpayer to give up part of their paycheck to subsidize THEIR lifestyle…as long as wind blow, grass grow and sun shine…..what’s good for the goose is good for the gander, right, small dead minded???

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