GM Declares Bankruptcy Imminent After $4.2 Billion Third Quarter Loss

[Ko-nsx]

I worked in the St.Louis chrysler plants for 7 years as an Electrician. People think the workers build crap. UAW workers make no decisions about, materials, marketing or what products they release. If the greedy CEO's care more about lowering line speeds and actually giving workers something good to build in the way of materials maybe the US carmakers would be in a better position as far as quality. Chrysler South minivan and North Ram truck plants used to roll out 1000 cars a day, at least 500 per shift. When the line speeds run that fast and people are putting vehicles together with wet toilet paper(that about sums up what the big 3 put in their materials vs the foreign carmakers), quality is last on the list. The foreign carmakers have nowhere near those line speeds, hence better quality. But upper management makes choices and they have made some bad ones. Chyrsler had 2 billion cash reserves before the Daimler merger. The UAW workers didn't steal all that money. Chrysler christmas parties for the big wigs used to be in excess or 500k. A guymaking $22 an hour to put in rear view mirrors didn't put the big three in the financial position they are in. They averaged at least 13k in profit on a minivan. Paying CEO's millions for poor performance is the problem.

Not taking up for the workesr but they are not to blame.

 

[drtruong]

I don't know what to believe. The media states that a worker (old timer) makes at least $70-75 hour ( including all the benefits) to put nuts and screws on the cars. On contrary, Honda and Toyota non-union workers get paid $40-$45 hour. I think that kind of salary is way too much for un-educated workers. In the end, they have to cut the corners to make the profits by putting cheap stuff on the cars.

 

[TC]

But upper management makes choices and they have made some bad ones. Chyrsler had 2 billion cash reserves before the Daimler merger. The UAW workers didn't steal all that money. Chrysler christmas parties for the big wigs used to be in excess or 500k. A guymaking $22 an hour to put in rear view mirrors didn't put the big three in the financial position they are in. They averaged at least 13k in profit on a minivan. Paying CEO's millions for poor performance is the problem.

Not taking up for the workesr but they are not to blame.

No doubt that top management made bad moves. Many that cost the companies billions. I agree that the workers aren't directly to blame but I still believe that the union system has been equally destructive to the Big-3 as management blunders. At its peak, the GM jobs bank had over 14,000 people, all earning 95% pay. That is well over a $1b per year expense. Most of the 6,000 workers still in the job bank today have been there for more than 4 years! Clearly, those workers have had no interest to even look for a job.

It was the workers and union that struck GM twice this year - what kind of greedy idiots strike a company that has lost money for 4 years running, not to mention that a new labor contract was signed in 2007? And, of course, they didn't strike the entire company, just the plant making the only Buick that is selling well, the Buick Enclave crossover. Whether the actual wage+benefit number of $50/hour or $75/hour, UAW pay and benefits are outstanding, so what were these strikes about?

My father was a machinist and tool & die maker for GM for 26 years and hated the union. As you probably know, the union caters to the line workers because there are so many of them. My father was a master tradesman and new-hire line workers made as much as he did with 10+ years of seniority. My father also hated the waste and laziness that the union system protects.

While you may not want to believe it, the workers did/do end up with all of the money from GM, Ford and Chrysler. The obscene pay that a guy like Wagoner gets - $17m per year plus a private jet at $20k per day and $500k parties even once a month adds up to $28m per year. GM is losing $2b per month. That money is going to about 250,000 workers at GM and Delphi, which GM is subsidizing. If you take 250,000 workers at the supposed $25/hour wage difference between the UAW and the US transplants, that comes to exactly $1b per month. So the union is costing GM a $1b per month and inept management is the other half. And this is not a new thing - GM has lost $65b over the past 4 years. And so far, the ONLY people who have actually lost anything are the shareholders and bondholders.

IMO, it is a perfectly equal 50-50 split on who is to blame - management and organized labor.