Big 3 Bailout

[dashaver63]

I am curious as to what everyones thoughts are on this bailout. Do you think it will save the auto indutries or just delay the inevitable. I personally think it just a band-aid, just because they get new capital for operations, it won't help sales which is where the problem lies.

[Durand Dan]

I heard a gentleman the other day on NPR who contends that the root of all the problems occuring with the auto industry and sales in general are the wages of the American worker. He stated that wages today adjusted for inflation are on average 33% lower than 1973. That being said I don't believe that a bailout will cure the problem, but way not lend them the money? We're dumping cash in the financial market at an unbelievable rate.!! What's 30 billion dollars?

[Bender]

I think something needs to happen, but I don't quite know what needs fixed. All of this news is making the matter worse so now it is necessary for a bailout to regain consumer confidence.

They do need to adjust their line up of vehicles a little to sell more, but I understand they make a lot more on trucks and SUVs so they would rather sell those than small cars. In what direction do they need to go? Personally I think Hybrid technology is overhyped and not worth the expense. Look at the new Chevy truck, the hybrid option gains 3 MPG city and 1 MPG highway. E85 didn't work out too well either, cutting into the food supply and driving the price of corn through the roof. To me clean diesel seems to be a good way to go. We can make the fuel here, with biodiesel becoming more available all the time. I'm running a bio blend in my car right now getting 40-45MPG. A diesel just won the "Green car of the year" award last week too. The Big 3 do produce cars with similar technology for other markets around the world, why did they not bring them here? They brought the Opel/Vauxhaul Astra here under the Saturn name but without a diesel option. Would people buy them?

The next issue is health care and pension costs. There's a lot of talk about GM's workers costing about $71/hour and Toyota's costing $47. Right now Toyota has only a handful of retirees to pay for because they have had factories in the country that long. Maybe I'm wrong but wouldn't their labor cost be a lot higher if they had the huge amount of retirees that GM does?

Is it quality? I had my share of crappy American brand cars in the early and mid 90s and switched to German cars. Three of the last four cars we have bought within the past few years have been GM and I cannot complain about the quality at all.

These are just my observations as a supplier who has been in and out of factories for years and I am definitely feeling the crunch. I hope something happens soon at least for my sake.

P.S. I like maps and here are some interesting ones showing what an atlas looks like depending on car exports, imports, private healthcare costs, etc: www.npr.org/multimedia/2008/11/atlas/

[dartag]

As someone who has worked for GM for over 30 years this topic definitely hits home.  I have seen the best and worst in my time there.  This has to be the worst.  If one or more of the big 3 were to declare bankruptcy to trickle down would be huge.  When an airline declares bankruptcy they operate as normal until they emerge.  When someone is buying a 300.00 plane ticket there is not much to lose.  When you are paying 30,000.00 for a new vehicle would you want to take a chance the company would be gone in a year.  The jobs lost are not just the auto workers and retiree pensions.  Like Chris stated the suppliers, dealers, local economies would be affected.  The one number I read was an estimated 3 million jobs lost.  Gone are the days of profit sharing and bonus checks that used to help boat and RV sales.  I believe the big 3 will get there loans,  but  it will come with some huge changes in the way the auto industry is run in the future.  It is my hope they all survive and prosper,  so we do not become a nation of people depending on foreign cars for transportation.

Steve Smith
Commerce, mi

[Skulley]

I heard a gentleman the other day on NPR who contends that the root of all the problems occuring with the auto industry and sales in general are the wages of the American worker.

The gentleman on NPR doesn't have a clue.  Essentially he is saying it is alright for the CEO's and high ranking corporate officers to take the outragious bonuses.  That is where the pain is.  It is not the American Worker.  It is all I can do to make ends meet without any O.T. or anything like that.  Mulally won't work for a dollar a year.  Wagoner won't work for a dollar a year.  Nardelli already is.  Nardelli doesn't get paid until Chrysler turns a profit.

I am curious as to what everyones thoughts are on this bailout. Do you think it will save the auto industries or just delay the inevitable. I personally think it just a band-aid, just because they get new capital for operations, it won't help sales which is where the problem lies.

Let's first understand that this is not a bailout but a bridge loan.  A bailout is what the banks got.  What that means is that the banks do not have to pay back any money to the Government whatsoever.  The Auto Companies want a loan.  That means they are going to pay it back.  The banks and AIG don't have to pay back a dime.  So tell me where that is fair.............This all started because banks were giving mortgages to people who were not qualified to get them.  So now we pay for their bad decisions.  That I am not in favor of.

We're dumping cash in the financial market at an unbelievable rate.!! What's 30 billion dollars?

Thirty billion is a mere pitance compared to what the banks have already gotten.  That thirty billion will be paid back unlike the 700 billion that went to the banks. 

If the auto industry or should I say the domestic three go under, so will a lot of other businesses.  The effect will be devistating to the Michigan economy.  The little market on the corner will go under along with all the other "Mom and Pop" businesses.  All the auto suppliers will go under and the devestation will waterfall until the economy in Michigan will be at depression standards.  Don't expect me the auto worker to take a pay cut until the Mulally's and the Wagoners take a cut.  The worker has already taken concessions.  I know I have and so have a lot of my Union Brothers and Sisters from GM and Ford.  Enough is enough.  The arrogance of the top ranking officers of these companies can not go on and neither can their compensation plans.

BD             

[Buckeye]

I want to say that I just jhope someone steps forward with a plan to help the companies compete.  I have to say I don't know what is best for the big 3.  I'm not that bright I guess.  I hear some claim bankruptcy is the way to go, and others say a bailout is needed.

I am opposed to bailouts 99%.  My wife and I spent our $1200 last year on our stimulus check (a bailout) on buying stock.  A lot of good that did.  I'm sure we lost it.  I drive a Chevy truck and wouldn't think of buying anything else.  But when we bought a new car, we went with a Honda Accord.  It's built right up the road in Marysville and employs Americans.  I want Americans to make a good wage for an honest day's work.  It just seems like any bailout is going to come with a lot of concessions.

I also agree that CEO's taking huge bonuses is a part of the problem.  Sam Walton built his business up on the principle that the owner of a company shouldn't make more than 5 times what the lowest person in the company made.  Those days are gone.

But, we're gluttons for punishment.  We shake a stick at the CEO's, but we'll turn on a football game on Sunday and watch a bunch of knuckleheads play games for millions of dollars.  We'll go to the movies and watch terrible films where actors make $20 million a film.  Pigs get fat, hogs get slaughtered.

Eric 

[cr]

I like the way it's played out so far , the big-wigs got chastised in the media for showing up in private jets, not knowing how much money they needed,and now they want to block the tracking of their jets. I'd like to see how the cost of total hourly costs,retiree's, current worker's,and health costs compare to the multi-million dollar bonuses, inflated pay and expense accounts of the top level executives . Not to mention the money spent on prototype cars that never go into production , car shows, which are just party's for the big-wigs ,pro-golf endorsements, Nascar and NHRA, etc...etc... Anyone who is naive enough to think the cars they're racing are in any way related to the cars in the showrooms, cant afford to buy one ...IMO...I think that the way to sell the most cars is to build the BEST car !!!!!  The hourly worker has no say in how the company is ran , but takes all the blame when things get tight . I hope they don't get the loan/bailout and then maybe the press will start to scrutinize where the money is really going and public sentiment might  turn in favor of us.

[djkimmel]

Don't know if a loan is such a bad idea when I think if this means Michigan will take a bigger hit than it already has on the economy, I am very worried. I hear from so many other businesses how tough and getting tougher this economy is on them already. I can't imagine it getting worse?

Interesting video produced by outdoor advocates who support our US auto/truck industry and want to make sure we all know what may be at stake. Take 30 seconds to watch it if you haven't already. Thanks.

Check out www.gmfactsandfiction.com if you haven't already.

[dashaver63]

The problem I see with the government loaning the automakers the money to survive is that alot of it will leave the country. GM, I beleive, has outsourced research to China and also makes alot of there cars there. So how would a bailout help the American people? BRING THESE JOBS HOME!

[Eric]

1.   Can't afford to bring the jobs home.  Unions have priced their labor right out of the market.

2.    Help companies compete.  Can't compete domestically.  Other labor is reasonable (affordable) and the quality of work is superior (no union rep to go cry to when you don't get your way or are asked to do your job).

3.    Hourly worker takes all the blame???  Ain't buyin it. See the end of number 2.


4.    Once upon a time unions were probaly necessary and I imagine are still good if you work for a bad employer, but for the most part the unions are largely to blame.  My experience is they just protect the bad employees and keep the quality of work down.  That has reached broadly enough that other industries, not as notable, have shut down, etc.  Secondary to that, the former employees, now jobless, now cannot afford to buy anything.  So, the big ticket item companies (like autos) suffer also because no one can afford to buy them.  Then they begin to experience financial struggles as we are hearing about today. 

My area has been noted nationally for the jobs that have left the area.  So much so that the state created programs extending educational and unemployment benefits to 24 months.  Now most all of those extended benefits have expired and very few of these people have jobs still.  It is very competetive for a job at McDonalds, and there are no "good jobs" to compete over.  Will an auto bailout or loan fix this kind of thing.  No way.  If they can't make any money now, how are they going to pay back a loan without any money.  Just another case of hey, can I get something for free too.  No way they will be able to pay it back, so the gov't will say don't worry about it, rather than force 3 million jobs to go away.

[cr]

 Hey Eric, I read your post this morning but waited to respond to it so I would'nt come across like Big Dog did . I'll have to disagree with every thing you said . I worked at four different divisions of GM in my 30 yrs of service and 95% of the poeple I had the pleasure of working with were honest hard working salt of the earth people . I have seen people come in early to start their job because they were not as fast as others, but took pride in the fact that they still got the job done. I will also say that in my opinion 90% of the workers never called their union rep because they never felt the need . Sure there was the 5% or so that were real pieces of dung, but why penalize every one in the union for the actions of a select few ? Back in the early eighties, when the economy was strong, GM was bragging about how great their work force was , before the pencil pushing pinheads took over .When the economy was good people were buying gas hogs and had two or three vehicles each . How can you blame the current state of affairs on the UAW? The big three are not the only companys having problems, just the only industrys large enough to affect MILLIONS of people!!!!  The UAW is not perfect ,but what or who is ? I'll have to agree to disagree with you, but would also say dont judge me or my UAW brothers until you walk a mile in my shoes, so to speak. 

[djkimmel]

Generalizations are usually not productive or accurate. What is that saying about painting everything with the same broad brush...? Or something like that? I realize these kinds of things often turn into an angry union/anti-union thing. We hear so much about the negative and not enough about the positive. We end up feeling like everything is negative, especially during tough times. I know because I fall into the trap of generalization all the time. It is easy to do.

I prefer not to get into another 1 of 1 trillion debates about union verses anti-union on here, but I won't delete the nonpersonal posts. Unfortunately, I do have to delete posts that make things personal. It is okay to disagree and say so, but not okay to say things about the person because you disagree. Talking about the 'union' is not the same as saying something about the character of a person although I recognize (as everyone should) that, particularly in this region, statements about unions will strike a chord with many. Just keep it about the topic, not the person please. Even if you feel like it is personal because the topic is close to home, keep it about the topic and what is said, not the person/person's character. Thanks.

A rule I try to follow most of the time... like don't shop while hungry... don't post while angry, especially really angry because something has struck close to home. It is often harder to get a message across when the red is still filling the eyes too much.

I do think this issue of the big three affects too many persons/companies to make the final decision based on any generalities or because of one aspect of the issue instead of the whole picture. I'm much more comfortable considering a loan to companies rather than just giving out a huge amount of money like they have done for the banks and then watching what appears to be questionable use and practices continued.  A loan, at least has more possible recourse behind it (I hope)?

[Eric]

Reading between the lines makes me think there was a post that got deleted that I didn't get to read.  That's a bummer.  If it was directed at me, if someone wants to pm me with some details, that would be great.  I enjoy a good read. 

Anyway. CR, I agree with you for the most part.  you are right that the vocal minority gets the most attention.  Millions of people aren't the minority, and do earn what they get.  I was simply sharing my experiences, and some of my opinions.  I never singled out anyone or any union.  Like I said, I'm sure there are places that unions are/were beneficial.  I have been fortunate enough to never have had my dad or myself work for a bad employer where the employees would have needed representation.  I remember him getting profit sharing checks, Christmas parties and turkeys, etc.  He, too was in the auto industry.  I know I am lucky.    Didn't mean to cause anyone to have a stroke or start a war, but........  I was home, surfing and bored, so I shared some of my experiences and thoughts.  Since mine are different than others, does that mean mine are wrong?

Which bass boat is best, which motor is best, MSU or UM, Ford, Chevy, or Dodge, who makes the best line........................................

Anyone wanna go fishin?

[LAPORTE]

Well I have been waiting to post.

And I suck at writing these things

(Just my opinion does it make it the only one or the right one.  no way) 

     I too work for Ford Motor Company I'm skilled labor. But I have not been here all of my work life.  I worked for the first 10 years of my carrier at a small job shop of about 200 people where I did my apprenticeship. When I worked there you were always busy performing tasks within your trade and other trades as well. We had all of the great things that small companies have very nice Christmas parties and over the top picnics, for the most part a great place to work. Only until the management changes along with owner ship did things lately change in a big way. Last Christmas  The very same company just up and fired over 20 persons skilled and non skilled giving no reasoning... most of these persons were in the later stages of there employment 25 plus years each some with health issues. Now they have nothing but what they have saved in there 401k and bank roll. I guess you could say a Union would have been nice.

   Now like I have said this was my first 10 years. My last 15 have been with Fords and yes my first months in the plant were like wow!! A whole different world. I started cleaning my machine. While I was waiting for a trades person to come over and look at it to make repairs. Wham a cleaner came over and ask that I please stop doing his job. Ok now what. A supervisor told me to go over and read a paper and wait.
       That was 1994; today 2008-9No cleaners exist in the plant.  All have gone, not to other jobs but just retired. They in no way could start on a line at there age.

  We started off in my department with 22 heads. For 2900  production heads working 6 day 12 hours as of Jan 1 2009 we will be operating with 5 heads for about 600 heads total working 40 hours for the last 3 years in the plant. In a nut shell we are putting out more work with 5 heads than we did with 22 the biggest difference has been the attitude.  When we lost the 17 heads over the last 5 years all of the old school thinking went out the door. The younger seniority stepped up and asked for better equipment to do a better job faster with out of the box thinking.

The days of thinking that every auto worker goes to work to sleep until they get off .... Man is that so old.
Yes I'm blessed to have a great job. But did you ever stop to think I wonder what the guy make picking up trash or how much does that person make giving my wife a perm for her hair. My point is that hundred of jobs out there make above average money. Why are the autos always right to the forefront.... I just not sure

My hope is that we can get some help from the government to get thru these troubling times. And start putting a car or truck out that the people just love. Also people love things that are cheaper.... I think that all of the import companies should be taxed as we are taxed in their countries. Other countries seem to protect their own we need to do the same. If a person were to buy a new import that is fine with me. I just wish they had to pay about 40% more for the car or truck that they do now

The big 3 have been making cars here for over 100 years and thru most all of that time they have agreed  to take care of there employees. The imports on the other hand have been here for 35 years and are just taking care of themselves.  I was wondering with no legacy cost (retiree cost) from the imports to speak of and if there labor is so much cheaper (new hires in my plant 14 dollars per hr.)  Maybe cars should be ½ the cost of a domestic car or truck.


         I know several of us have seen an e-mail flying around over the past few years about the 9-11 auto donations. I just got that one yet again a week or two ago. It was listing all of the monetary donations that the auto companies had given after 9-11  All of the domestic autos shelled out millions including  Volkswagen and 1 other  were out of the states and you guessed it Imports totaled a big ZERO I was hoping if this was true it would be picked up by main stream media.... It may be just a giant hoax..... Maybe they did give monies im not sure.... 

As you may have already guessed I'm not a huge fan of imports... I have several friends and some family that drives them I just don't understand how you can't buy a truly American car. If you want to know if you drive an American car just as yourself one simple question when you give the dealer a check for the car where does the money go!!! Over the pond or S.E. Michigan 

it's gonna be a long winter with these kind of topics...

who started this....lol 

Don L

[bosshawg]

 i hope these CEO's think long and hard as they drive their way to washington for this next go around.

[dashaver63]

Yes Don, I'm the culprit here. I also work for Ford as a supplier for the Edge and MKX. We make the entire chasis parts for those 2 cars. If you take off all the outer body parts, what's left comes from Findlay, Ohio. We also do parts for GM and Mitsubishi but on a MUCH smaller scale. I didn't intend this thread to become a discussion about Unions, however I have to agree with Eric. There is a reason Ford suppliers like the one I work for are non-union facilities, wages and benifits, plain and simple. Suppliers have to keep their costs down to sell low cost parts to Ford. The entire chasis for one vehicle that Ford buy's from us costs less than $200.00. All other suppliers have the same contract with Ford that we have and that is to show a certain percentage of cost savings ever year, meaning we have to sell those same parts for less. Guess who has to pay for those cost savings? The workers do. They save money by paying less of our health insurance every year, so we pay more of it. Then our little raise every year doesn't even cover a tenth of the increase, so we lose money out of our pockets. I have worked there for 10 years and have 10 days vacation, 5 of which I have to use for July shutdown. We have asked for more but it comes back to cost. So, where does that cost savings go that we give to Ford? Spending less every year for parts you would think the cost of the vehicles would go down, but no, they go up to pay the union wages and raises they get every year, and all the upper management and ceo's. I'm not anti-union by any means, but I would like to be treated comparably to the union workers. We make enough parts in one day to build almost 1000 vehicles, and it's not easy work either, all hands on, no automation or robots. So, walk a mile in MY shoes, I feel like the unwanted stepchild looking in the window while my brothers and sisters opening their christmas presents.

[1javelin]

Never have I worked for a union company, so I may be off a little, but:
  I have been at my job for 5 years now and would be tickled to death if I could receive the hourly wage of a union employee.  But, here goes the "I want to get as much as him" agenda.  Why don't you get as little as me instead?  I am not a lowly man on the totem pole here, I have worked as the General Manager and 'Assistant Manager' for my company for years now.  I was lucky enough to make $40,000 a year, once.  Now I work for well under $15 per hour, so as not to implicate my exact salary, have 2 weeks of vacation, my insurance coverage was just cut in half, my 401k match was just cut in half, but I am still working.  I own a home, 2 vehicles, a boat, and am in debt over my ears.  Come live in my shoes and tell me that unions don't make it harder for us. 
  We had a power problem and it took 6 employees of the electric company to repair it, 5 to watch and 1 to work.  How much were these guys making??  I bet a lot more than $15 per hour.  No wonder the cost of everything is going up around here, a few people get overpaid while most of us get underpaid, then wonder why we show up in an import; because we can't afford to pay for domestic!!  We shop at Wal-Mart, who puts companies out of business with their foreign products, because we save a few bucks over shopping local goods!!  I pinch and pinch while everyone else cries about how they can't go on 3 vacations this year and what not.  I agree with you 99% Eric.  Some unions may still be good, but it's a matter of time before they are just as corrupt as the rest of them.

1Jav

[LAPORTE]

What a topic... There is no place for this one to go but down hill. With that said, I sure is a great country we live in to be able to say what we want about the things that mean so much to us all.

I'm out,  see you in the spring for sure .... I love you all no matter what you drive where you work or how much you make. Because I'm happy just to be able to wake up and talk about fishing....

Don L

[thedude]

you can't point the finger at any one level of the auto industry.
- Unions causing unnecessary overhead
- Management / White collar jobs that are pointless or even anti-productive
- Gross overcompensation of executives
- Lack of vision and planning at the executive level

What it really boils down to is the fiscal dysfunction of large, bureaucratic corporations (much like our federal gov't).  Manufacturing has changed and the auto industry has just been big enough to ride the storm until now. We absolutely need a domestic car manufacturing market for numerous reasons - we need to get away from the Big 3 and go to the Medium 12 however. Allowing a company to be competitive also means not having all your eggs in one basket. That said dumping money into a sinking ship just means your money sinks with it... i think the bailout is a bad idea, and a waste of money.  Either way, it will be painful... I don't foresee GM making it out alive either way. It would almost be best to just hunker down, let them go bankrupt and be there with the 30bil to help start up new companies and manufacturers from the ashes.  Use some of the money to backup the pensions and warranties on the current vehicles.

Like i said - either way wont be pretty. I just don't feel that we should let fear spur us into setting a big pile of money on fire.

[Eric]

It looks like there is a lot of intelligent discussion going on here.  That is very cool I think.  We all have our own opinions, and regardless if I agree with yours, I will fight for your right to have it.  I love America.  How many people have learned something from this thread.  I know I have, and I have looked into some things I hadn't heard before this thread.  So, even though this ain't about fishin, it's still pretty cool, I think. Keep 'er goin' boys.

Go Wings!