GM closing nine plants

[Modelcar]

Toyota will soon be building cars in the Subaru plant here in Lafayette, Indiana. About 120,000 per year. As for GM's troubles I believe it is at a very critical stage and for sure, it would not be good for our economy in this country as it may cause some domino effects throughout the auto industry along with effecting so many lives. I also believe there is enough blame on all sides to go around that contributed to the situation GM finds itself in now....I think we all know pretty much what many of them are....I hope somehow people can come together with sensible minds and make the changes necessary to create a GM that can survive and make money...and better vehicles to compete with the world market. I'm not putting down GM as I have owned many of their vehicles...and at present have a Chevy Xtreme as one of my vehicles...and enjoy using it....

[greyhounds]

Just as an aside to the union issue, I flew home for the Thanksgiving weekend on Northwest from Minneapolis.

We all know that the Northwest mechanics are on strike and they had a four person picket line up at the airport. I don't think anyone cared. Everybody else just worked and got me home in fine shape. The airport was very uncrowded, to my suprise, the plane was on time and not full.

Unions have their place, but in the past they have been very unrealistic, especially with the railroads. They can, and should, protect workers from abuse, but they can't turn a $20/hour job into a $30/hour job with a piece of paper.

[MJ4562]

QUOTE: Originally posted by Tulyar15

QUOTE: Originally posted by 440cuin

Are the Honda and Toyota plants even unionizedd? I don't realy know but I have heard they are not.

Their plants in Britain most definitely are unionised, and they're also the most efficient in Europe. They also pay the best wages in the car industry here and seem to be doing well.

As Napoleon once said: "No such thing as a bad soldier, only bad officers".

The discussion is referring to plants located in the United States. I'm referring to their US operations. Plants outside the US are not relevant.

[Tulyar15]

QUOTE: Originally posted by 440cuin

Are the Honda and Toyota plants even unionizedd? I don't realy know but I have heard they are not.

Their plants in Britain most definitely are unionised, and they're also the most efficient in Europe. They also pay the best wages in the car industry here and seem to be doing well.

As Napoleon once said: "No such thing as a bad soldier, only bad officers".

[MJ4562]

QUOTE: Originally posted by edblysard
As for foreign autos...most of your Toyotas and Hondas are made right here, in Tennessee and Kentucky, and Toyota is building a plant here in Texas.
All built by American auto workers, all paying those extreme union wages.

No! No! No! Toyota and Honda plants are 100% non-union. There is a reason why Honda and Toyota locate their plants in right to work states. They do not pay anywhere close to what GM pays.

I blame GM management for not taking a tougher stance on the unions and allowing them to negotiate sweetheart labor contracts.

The unions need to realize that if they don't give, they will end up with nothing. Without drastic cuts in benefits GM's only viable option is bankruptcy. That will mean those retirees will lose their pensions and their health care (plus numerous other benefits they receive for free). One of the problems with the unions is that the union bosses really don't care about this--they are already set for life. They have more in common with GM management than with their members.

This is an issue for all Americans. Not only will the US economy take a major hit if GM goes under, but we will all have to pay when those former GM pensioners become wards of the state.

[Anonymous]

I didn't say I liked the idea. I know they did something like that, I'll just have to go do some reasearch


P.S You've got the right attitude about those taxes.

[rrnut282]

James
Japanese cititzens are not forced to buy a new car every year. The opposite is closer to the truth. A Japanese citizen cannot buy a new vehicle without proof of off-street parking for it. If I got all my taxes back every year, I might be able to swing another car payment. To be forced by my government would be grounds for a revolt.

[Anonymous]

QUOTE: Originally posted by jsanchez

Then why are the unionized Japanese plants not being shut down, also American Auto workers earn less than their Japanese and German counterparts. I used to be anti-union until I got a job on class one railroad, believe me unions are needed more than ever.
What kind of pay cuts are the executives taking at GM for making cars the public has little interest in, GM's biggest problem is going to be with consumers under 30 who much prefer Hondas, Suburus and Toyotas and for the most part do not even consider a GM product as an option. It helps to build a product people want and by the way Chrysler is doing well because of doing just that!

QUOTE: Originally posted by Lotus098

Paul,

Businesses have to think of wages as a cost, like steel. A company is not going to over pay for supplies; neither are they going to pay for high wages. Now because of it (and other factors) none of these people have jobs, a lot of good those unions did, and are earning nothing instead. The money to pay people more has to come from somewhere, in this case the price of the car. If you are in such favor of Unions I suggest you always pay the highest price for everything, since odds are that has the most Union people to pay. Raising wages, be it minimum wage, or by unions, is like inflation, it really doesn't get anyone any more money, since the people earn more, but also pay more for goods. Unions had their place historically, but have outlived most of their usefulness, becoming collections places for a certain political party, in fact did you know that the ACLU was founded by communist?

I believe in Japan their citizens were\are, forced to buy new cars every year. That explains that. I think when it comes to these companies especially European ones; people are willing to pay for quality, no American company has anything close to an Audi, either quality or price wise. Also, Japanese cars, like Honda, were good quality high mileage cars; so they had a part of the market with little competition, from American companies. This, as noted, was a big problem for GM.

I am always looking to see how people think on issues like this. Why, in your opinion do we need the unions now more than ever? What do you view as flawed in what I said about economics?

[Modelcar]

...As most know GM's costs per vehicle are too high as compared to competition...and everyone that is around the bargaining table must take some blame. Now the problem has mushroomed to a breaking point and action must be taken or we will not have a GM much longer. Seems both sides will now have to dig pretty deep to "save" the operations....The end result down the road in a year or so will be very different than it has been in the past and as it is now....

[TH&B]

Are the Honda and Toyota plants even unionizedd? I don't realy know but I have heard they are not.

[jsanchez]

Then why are the unionized Japanese plants not being shut down, also American Auto workers earn less than their Japanese and German counterparts. I used to be anti-union until I got a job on class one railroad, believe me unions are needed more than ever.
What kind of pay cuts are the executives taking at GM for making cars the public has little interest in, GM's biggest problem is going to be with consumers under 30 who much prefer Hondas, Suburus and Toyotas and for the most part do not even consider a GM product as an option. It helps to build a product people want and by the way Chrysler is doing well because of doing just that!

QUOTE: Originally posted by Lotus098

Paul,

Businesses have to think of wages as a cost, like steel. A company is not going to over pay for supplies; neither are they going to pay for high wages. Now because of it (and other factors) none of these people have jobs, a lot of good those unions did, and are earning nothing instead. The money to pay people more has to come from somewhere, in this case the price of the car. If you are in such favor of Unions I suggest you always pay the highest price for everything, since odds are that has the most Union people to pay. Raising wages, be it minimum wage, or by unions, is like inflation, it really doesn't get anyone any more money, since the people earn more, but also pay more for goods. Unions had their place historically, but have outlived most of their usefulness, becoming collections places for a certain political party, in fact did you know that the ACLU was founded by communist?

[jeaton]

QUOTE: Originally posted by eastside

QUOTE: Originally posted by jeaton
Of course, these day, one might question how much time is ever given to thinking.

Have people there also remarked that that this week's cuts may have only been round one? I haven't seen anything specific to Janesville, but most analyst articles that I've read insist that GM must go much further.

Many prople around here are of the opinion that Janesville is at the edge, but not OUT of the woods.

Jay

[eastside]

QUOTE: Originally posted by jeaton
Of course, these day, one might question how much time is ever given to thinking.

Have people there also remarked that that this week's cuts may have only been round one? I haven't seen anything specific to Janesville, but most analyst articles that I've read insist that GM must go much further.

[jeaton]

QUOTE: Originally posted by Chris30

Kick 'em when they're down...

As mentioned previously, I'm also surprised that the GM plant in Janesville, WI survived. It's an old plant that has been in the cross-hairs for some time. Without the GM plant in Janesville, I'm guessing that the UP would give up and sell the Harvard & Cottage Grove subs to the Wisconsin Southern.

I didn't see it posted anywhere else... I wonder how much politics had to do with a plant closing or staying open?

CC

While the Janesville operation has been around for a long time, a few years back GM put a ton of money into the facility. I have an iron worker as a tax customer and he usually comes with at least a half dozen W-2's a year from the different contractors he has worked for during the year. Back just a few years he had two years of only one W-2 from the contractor doing work on the Janesville plant.

My reading of the business press isn't as great as it used to be, but I haven't seen anything that suggests that politics had anything to do with the selections for closing.

One would think that they not only looked at a ranking of "performance" for the different plants, but also looked at what would be left in terms of the efficiency of the configuration of the remaining plants.

Of course, these day, one might question how much time is ever given to thinking.

Jay

[chad thomas]

QUOTE: Originally posted by CrazyDiamond

QUOTE: Originally posted by chad thomas

Not me, I have a 69' Plymouth Sport Fury that I plan on keeping till the day I die.[8D]

I own a '68 Plymouth Satellite Sport Convertiable.....440....WOW what a car. I'll never sell that baby if I can help it. [:D]

Sweet !!!!![8D]

[TomDiehl]

QUOTE: Originally posted by CrazyDiamond

QUOTE: Originally posted by chad thomas

Not me, I have a 69' Plymouth Sport Fury that I plan on keeping till the day I die.[8D]

I own a '68 Plymouth Satellite Sport Convertiable.....440....WOW what a car. I'll never sell that baby if I can help it. [:D]

I'm guessing you don't use that as a commuter car, especially with today's gas prices.

[CrazyDiamond]

QUOTE: Originally posted by chad thomas

Not me, I have a 69' Plymouth Sport Fury that I plan on keeping till the day I die.[8D]

I own a '68 Plymouth Satellite Sport Convertiable.....440....WOW what a car. I'll never sell that baby if I can help it. [:D]

[Chris30]

Kick 'em when they're down...

As mentioned previously, I'm also surprised that the GM plant in Janesville, WI survived. It's an old plant that has been in the cross-hairs for some time. Without the GM plant in Janesville, I'm guessing that the UP would give up and sell the Harvard & Cottage Grove subs to the Wisconsin Southern.

I didn't see it posted anywhere else... I wonder how much politics had to do with a plant closing or staying open?

CC

[greyhounds]

As for locomotives, GE seems to be doing all right these days. For a long time they've had an emphasis on developing good management. (It doesn't just grow on trees.) It seems to have paid off for years.

Other bright spots (although not as bright in US manufacturing include Boeing, which seems to have righted its ship and my hometown favorite, Caterpillar.

[Anonymous]

What new name do you suppose is going to be the future crown name for locomotives on the American railroads?

Honda
MIC - "Made In China" - to replace EMD
Sushimoto
Suzuki
Toyota
Yamaha

I despise the future for anything anymore!!! We were sold out as a nation, by our politicians, to tird world nations. NAFTA anyone?? CAFTA's next.

I'm just going to watch my train videos and sink back into the days of old - the 50's the 60's ..... when the chrome was still thick and the women were women ... when a team of ALCOs would go racing by with black diesel smoke filling the air and the fuel spilling out all over the gutter ... and there was no such thing as an environmentalist who is an "environmentalist " only because he could never make an honest living nor could he fill a baker's shoes.

Does some minute part of our politicians' concept of a futuristic brave new world involve us coming to a stop in our Hondas/Toyotas at a railroad crossing (signal parts & accessories made in China, Japan, & Taiwan) while waiting for two Sushimotos and a Honda locomotive pulling 100 corrugated aluminum frame fiberglass body railcars made in Taiwan, to come slithering by??? Is this "progress"?

[eastside]

As I recall it, the central issue of the blowup between GM and its unions in the ‘90s was outsourcing. In those days, outsourcing had nothing to do with foreign countries. It meant being able to use non-GM sources for parts. GM settled by caving in to the unions by offering generous compensation for lost jobs. This was extended in the crazy way in which GM structured the Delphi spin-off by ceding operational control yet remaining liable to pick up the pieces if it failed, canceling out almost all the benefits! GM’s every attempt to implement fundamental changes to its production processes seemed to have been either stymied or diluted at every turn. The ‘90s were a lost decade for reforming GM. A whole book could (and should) be written about this episode.

[eastside]

QUOTE: Originally posted by erikthered

Give some credit to GM's execs for selling EMD when they did. If they tried to sell it now, it would be going for a fire sale price.

Which makes one ask the question, was EMD doing that badly? I thought EMD was one of the few divisions of GM doing fair to middlin well. I figured EMD got sold to private owners simply to allow GM to focus closer on automobile and truck production.

1. If EMD were being sold now, a potential buyer would perceive GM as being in a weak position, desperate to raise cash, and would likely be more aggressive
2. We're further into the economic cycle and sales will probably start tailing off
3. Senior executives doubtlessly have more pressing matters than negotiating the sale of a minor division. Better that they got the sale of EMD out of the way

[andrewjonathon]

Maybe, just maybe the GM executives planned the Avian flu and it is on the way to rescue GM. If predictions are right, it could kill millions of people. Assuming it comes to the US and takes out enough of those "pesky" GM retirees that will take care of the pension problem.[:)] Of course it is a risky business for the executives as it could also take them out at the same time.

[eastside]

QUOTE: Originally posted by GP40-2

A few thoughts:

1) EMD was not a "crown jewel" of GM. Even when it ruled the railroad environment, EMD's revenues and profits were insignificant to GM. For the past 10-15 years, it was a money loser for GM.

[:D] C'mon, you think I was being serious?

[TomDiehl]

QUOTE: Originally posted by cmeastern

Some how, some way foreign carmakers figured that prices were only going to run up. Perhaps they actually believe what most experts in science say — that we are nearing the point when oil production actually starts to dip - permanently. Oh, that's right again. The Bush administration doesn't like to hear the truth and kills the messagers.

The gasoline prices in the US were always WAY below the rest of the world. This is probably the only country that didn't worry about gas mileage in their cars. Foreign car manufacturers were designing for their market.

[TomDiehl]

QUOTE: Originally posted by JOdom
[TomDiehl - In the '50's there were more than 4 domestic automakers. Hudson and Nash combined to form AMC in 1954. Studebaker bought the remnants of Packards sometime in the mid-50's, then Studebaker died in 1966.

When I was 2 years old, I really wasn't into cars. Also, notice I said '50's AND '60's

[GP40-2]

A few thoughts:

1) EMD was not a "crown jewel" of GM. Even when it ruled the railroad environment, EMD's revenues and profits were insignificant to GM. For the past 10-15 years, it was a money loser for GM.

2) GMAC: There are a lot of rumors flying aroud Wall Street that GMAC will be the next divsion GM will sell off to remain afloat. Seems those pesky retirees just aren't dying off fast enough. Of course, GMAC is about the only thing GM gas left that actually makes a profit, so the future dosen't look to bright for the General.

3) Ford went down the same road as GM with the large SUV's, however, the last figures I saw for Ford legacy/health care costs was only around $800 per vehicle (half of GM's $1500 per vehicle). Ford will also stop supplying rental car companies with cut-rate vehicles. That destroyed the resale value of used Ford's. For example, the new 500 and Fusion sedans will not be sold in large numbers to rental/fleet buyers. This alone has increased the projected used value of those products close to Toyota/Honda used values. Most of Ford's new cars have been highly received by auto reviewers-the new Fusion has been reported to have Honda quality and European driving manners. That is something that GM has never figured out how to do in a mass production car.

[Anonymous]

Did you know back in the 20's Republic trucks were in hot competition with Ford. In fact one year (1924?) they out sold Fords, and now you can't find Republic trucks. They got sold to a fire engine manufacturer.

History aside, don't panic about hybrids, good old American Ingenuity will come through and, we will have a better hybrid. In fact I will bet on it.

[samfp1943]

Oldsmobile, gone in 2004 and Spring Hill scheduled to close, Saturn will be gone in 2006. Maybe thay can sell that plant to Nissan who needs the space to build vehicles. You might say that Darwin's Theory of Natural Selection is at work in the auto industry.. Adapt or die.
GM on it's way to being another Fallen Flag.

[mnwestern]

Just goes to show you that high-priced management is usually the biggest bunch of dumb----- known to man. Here was GM, and other U.S. automakers, cranking out big, ole gas-hog SUVs and pickups (actually rolling battleships) because they are short-term cash cows, when foreign makers were putting research into the cars of tomorrow — hybrids, flex-fuel vehicles, light composites, etc. and raking in the increased sales as people finally switch to efficient vehicles when prices went through the roof.

Apparently, GM, Ford and Daimler-Chrysler execs were not invited to VP Cheney's little pow wow with energy execs back in 2001 when they mapped out the strategy to ratchet up gas prices to increase oil company profits to record levels (if that wasn't the plan, how did oil company's turn in record third quarter profits when they were said to have suffered so much physical damage from hurricanes.) If the carmakers had known that, they would have moved quickly to quit building battleships that will rust in the dealers lots (Oh, Heck, even I don't believe GM officials could move quickly on anything except running for their bonus checks.)

Some how, some way foreign carmakers figured that prices were only going to run up. Perhaps they actually believe what most experts in science say — that we are nearing the point when oil production actually starts to dip - permanently. Oh, that's right again. The Bush administration doesn't like to hear the truth and kills the messagers.

So, GM will not be the last American automaker to face bankruptcy. Why do we think that in the future we'll still build cars here. We build very little else. Everything is sent off to Asia, or Asians come back here to show us how it is done cheaply, without the old, crushing union contracts that are milking the auto industry just like the heritage air carriers.