Maximized

You guys have never been in a GM plant. Unions drive up the cost, while providing a lower quality product. Unions are one of the major factors why GM is struggling.

cob3683

The only ones for me is the C6 and my Tahoe. Other than those....nada.

F23A4

No, I somewhat agree. Unions

CGTSX2004

iTrader: (1)

:playstaps: I think it's the beginning of the end for GM as it is now...

Water-S

I was reading in detriot press about GM reporting 1.1 billion dollar loss. they said if this continues they will have to cut one branch of GM. here's my prediction:
Chevy: won't happen. this is what people think of when they think GM
Buick: no because they really up their quality in the last couple years. I'm not saying I like them but according to J.D. Powers a Buick better built than a Honda.
Hummer: Won't get rid of them due to goverment contracts.
Saab:they own controlling stock in Saab. I personally see GM selling controlling in Saab.
also subaru: GM owns 10% of Subaru. I see them selling that stock.
people i've talked with said Saturn is done. but in the last couple years I've seen Saturn put some serious money into cars to get new buyers or encourage people to buy cars.(which i know most car makers do) but if you know the end is near would you spend that kind of money.I wouldn't if I was the CEO.

Water-S

GM as whole company(i'm talking all brands) will never go under. they have so many companies like Chevy,GMC, Pontiac,Saturn, Caddy,Hummer, Buick. yeah they might trim some of those back as far as lines offered. and GM know for using the same car in 2-3 lines but just redoing it slightly to adapt to the line.example the Silverado and GMC Sierra. they'll quit that to reduce cost.

gavriil

General Motors boosts first half Europe sales 2.3% - - Reuters / July 12, 2005 - - Source: Automotive News

gavriil

GM posts $286 million second-quarter loss - - Auto business loses more than $1 billion - - Reuters / July 20, 2005 - - Source: Automotive News

gavriil

I mean....how much would they have lost if it were not for this employee discount program? Talk about "losing my shirt" here... Gee...

Bobbydoedoe

blame the unions and those overpayed exec.

titan

The employee program has been their saving grace, this quater, and they still lost $286million. That's a huge reduction compared to the first quater's 1 billion pluss loss, but still... without the employee sale it'd still be high. All that tells me is that they haven't really fixed what ails them, yet. Get the legacy costs under control; and the union has also GOT to budge, and more than just a little. In addition, they're product mix is still fucked up. Pontiac, even with the sale, lost money in June. Hummer and Buick had huge increases. So the G6 isn't doing what it was designed to do. And the Soltice will be a big step in the right direction, but it definitely needs a supporting cast of good bread and butter cars behind it.

ludachrisvt

iTrader: (2)

well if they want to get ahead of the azns they need to take some notes. We also need to get legislation that limits the cost of health care. My insurance tripled from last year!!!!

phipark

Well, at least the good news is that GMNA is the only divsion that lost money. All other divisions posted profits. To me, that should be a clear indicator that the UAW and health costs are driving the company downward.

cob3683

Unions and Lack of Intelligence on B.O.D. = Death of GM

heyitsme

Think its going to take a long time to get a company this size back on its feet, having waited so long to start the process. It sounds like its well beyond releasing new product also.

Loseit

iTrader: (1)

I think these things become glaring issues when no one wants to address the core issue. They wanna point the finger at something or someone for there problems. I am not saying these are not problems but the main problem is the product. Plain and simple. If that is not fixed nothing will happen. They can bitch and moan about that stuff all they want...but the fact is they are not making any money off there vehicles and can't even make costs. That is the bottom line. If they built vehicles people wanted and they were flying off the shelves at reasonable prices (ie w a profit margin for them) this issues wouldn't be so monumental.

We need that guy from VW to come to GM and basically come over here and tell em how it is. It's amazing that a company from the country were we like to tell it like it is doesnt wanna do so.

phipark

Why can't they make costs? Because the labor put into every vehicle is too damn expensive. Also, I doubt the labor they pay for is the best. GMNA is the only operation not creating a profit. Why? Because it is the only segment that includes the UAW. Europe has a union but seems to be more under control and agreeable than the UAW.

AcuraGT-3

SO sad, this is like weekly news...

youngTL

I don't think they'll die. Even if they got blown away in north america (unlikely), they still have operations internationally where they sell many, MANY cars.

kansaiwalker1

Fitch Ratings cuts GM deeper into junk status

DETROIT (AP) — Fitch Ratings lowered General Motors' (GM) credit rating deeper into "junk" status Monday, saying the automaker has made little progress in reducing its high costs and is vulnerable if gas prices remain high.

Fitch first cut GM to junk or high risk, high yield status in May. The latest action, which applies to GM and finance arm General Motors Acceptance Corp., lowered the rating one more level to BB, or two levels below investment grade. Standard & Poor's and Moody's Investors Service have also cut the automaker's rating to junk.

The move will likely make it more expensive for GM to borrow and refinance debt. The automaker has about $136 billion of senior debt, or obligations with priority for repayment in a liquidation, and more than $100 billion of other debt, Fitch said.

Fitch said GM is at heightened financial risk because of ongoing restructuring talks with Delphi (DPH), its former parts division. Delphi is threatening to declare bankruptcy next month because it says its spinoff agreement with GM left it with unsustainable labor costs.

"Although GM will benefit over the longer term by Delphi's expected lower cost structure and the ability to re-source product away from Delphi, Fitch is concerned about the short-term costs or other forms of financial support necessary to restore Delphi's financial position to viability," the agency said.

GM could be liable for $4.4 billion to $6.7 billion worth of pension and health care benefits for Delphi employees if the supplier goes bankrupt, Merrill Lynch analyst John Casesa said in a recent note to investors.

The carmaker also is disproportionately exposed if gas prices remain high because it's introducing so many large vehicles, Fitch said. The all-new 2007 Chevrolet Tahoe, GMC Yukon/Yukon Denali and Cadillac Escalade go on sale in January.

Fitch said there may be progress in GM's ongoing discussions with the United Auto Workers union on reducing health care costs, but that progress would be modest in the short term, since the UAW has indicated it won't reopen its contract with GM. The more significant event will be the contract negotiations between GM and the UAW in 2007, Fitch said.

GM spokeswoman Gina Proia said GM is committed to addressing its high costs as quickly as possible.

"We are firmly committed to improving our business performance in North America," she said. "We recognize there's still work to be done."

GM shares rose 8 cents to close at $31.15 on the New York Stock Exchange, where they have had a 52-week range of $24.67 to $43.29.


--------------------------------------------------------------------------------
Copyright 2005 The Associated Press. All rights reserved. This material


http://www.usatoday.com/money/autos/...-gm-debt_x.htm

Moog-Type-S

ouch.

Moog-Type-S

Will GM follow Delphi into bankruptcy?
One analyst puts bankruptcy at GM at 30% after Delphi filing, but another disagrees.
October 10, 2005: 1:52 PM EDT
By Chris Isidore, CNN/Money senior writer


NEW YORK (CNN/Money) - The chances that General Motors will have to file for bankruptcy are now up to about 30 percent, according to one industry analyst, following the bankruptcy filing by the company's former parts unit, Delphi.

The Banc of America Securities analyst, Rod Tadross, estimated Monday that GM's retirement liabilities are now up to about $6 a share, as the automaker warned Saturday that it could be on the hook for up to $11 billion in contract obligations to its former employees at Delphi.

GM spun off the world's largest auto-parts maker in 1999, but retained responsibility for some of the company's retirement health and pension benefits if Delphi filed for bankruptcy before 2007.

"Our strong belief that the United Auto Workers union will be tougher on GM than Delphi should get GM to more seriously consider bankruptcy protections," Tadross wrote in a report Monday morning.

Tadross also cut his 12-month target price for GM shares to $18 from $32.

Shares of GM (down $1.62 to $26.67, Research) fell about 5 percent, to under $27 a share, at mid-session Monday morning, following the Saturday Chapter 11 filing by Delphi. In Chapter 11, a company is protected from creditors as it tries to reorganize and work out a plan to pay its debts.

Despite billions in losses recently from its core North American auto operations, GM has a healthy balance sheet, with $32.3 billion in cash on hand.

It also has said it has a fully funded pension plan, though that does not include retiree health care costs, which have become a significant burden for the automaker.

Auto analyst David Healy of Burnham Securities said he agrees that Delphi's bankruptcy is a significant hit for GM but one that he thinks the embattled automaker is well positioned to handle, given its strong balance sheet.

"I still think it's unlikely," said Healy about a bankruptcy threat at GM. "I think GM has the liquidity it needs. In addition to the cash, it has $50 billion in untapped borrowing."

Even though Healy said GM probably will have to assume billions in additional contract obligations due to the Delphi filing -- maybe as much as $11 billion -- he said Delphi's move could eventually work out to be a good thing for its former parent.

He believes the United Auto Workers be more willing to deal with GM on the cost savings it is seeking to avoid the risk to more members and retirees. And he said that GM estimates it is paying $2 billion a year in above-market pricing when it buys parts from Delphi.

"A billion here and a billion here adds up," he said. "In the long run a restructured Delphi could supply GM with parts at lower prices."

GM Chairman and CEO Rick Wagoner has said repeatedly this year that the automaker needs to negotiate lower health-care costs for active and retired union members and their families, but has so far not won an agreement in negotiations.

GM spokesman Jerry Dubrowski said the company is not commenting on Tadross' note to clients or its own view of the risk of a GM bankruptcy in light of the Delphi filing.

In its statement Saturday evening, GM said it was too soon to specifically assess the impact of the Delphi filing on its own finances, adding it "expects no immediate effect on its global automotive operations." It said it could potentially face anywhere from zero to $11 billion in contract obligations from Delphi's filing.

Wagoner dodged commenting on the risk of bankruptcy in prepared comments in June when he discussed financial problems facing the automaker.

"What happens if we can't reach agreement with the United Auto Workers on [retiree health-care costs] promptly? Well, I don't believe that it serves a useful purpose to speculate on that," he said at that time.

"Let me just emphasize that our very strongly preferred approach is to do this in cooperation with the UAW, because we're convinced that is the best way for our employees, our stockholders, all our constituents."

Fibonacci

I'd put the probability higher than 30%. Their current business model is simply unsustainable unless they get relief on the cost side or their sales suddenly go through the roof, and I see either scenario as highly unlikely.

iamhomin

Ouch. Let's go Solstice!

cusdaddy

GM has many billions of liquid cash and assets. This article is sensationalist. I read a number of articles on the plight of GM and they are far from going bankrupt. The government would never let it happen anyway even if it came close.

I like how one so called "Analyst" makes a statement like this and an entire headline is devoted to it.

Fibonacci

GM also has many more billions of liabilities. Take a look at their balance sheet.

As for Uncle Sam, I wouldn't bet too much on that horse. If you're looking for an institution which is mismanaged, THE US Federal Government is a case study.

M TYPE X

Whatever happens with the suppliers, look for supply disruptions. Ford and GM have had a lot of cars not coming into full production on schedule, because the suppliers have been in financial turmoil and unable to deal with it ... or, their Honda/Nissan/Toyota accounts have been more important to them.

GM, this is your road to redemption. Now drive 55.

agranado

I hate the way GM is doing business right now, but that is pure sensationalism like cusdaddy said.

If several analysts came together and said the same thing, then, well, different story..

Fibonacci

Noone is saying GM's going out of business, just that bankruptcy seems to be the only option to release them from the burden of high costs.


Worries about GM rise after Delphi bankruptcy
One brokerage says risk of automaker filing for bankruptcy now heightened

Updated: 4:01 p.m. ET Oct. 10, 2005
DETROIT - General Motors Corp. shares fell sharply early on Monday on worries about heightened risks for the world’s largest automaker after auto parts maker Delphi Corp. filed for bankruptcy over the weekend.

Delphi is GM’s largest supplier, and the automaker warned that it faced an increased risk of costly supply disruptions after Delphi filed for Chapter 11 protection in U.S. Bankruptcy Court in New York on Saturday.

One brokerage said the Delphi bankruptcy increased the chances that GM might take the same step, dealers said.


Delphi bonds were quoted 6 percentage points lower in over-the-counter dealings, a trader said, sending ripples through the debt markets . GM shares fell 4 percent.

GM said a Delphi restructuring could “create operating and financial risks for GM,” but added that the bankruptcy filing did not necessarily make it liable for post-retirement health-care and pension benefits for employees at Delphi, which it spun off in 1999.


The range of exposure extends from potentially no material impact to up to $11 billion at the high end, with amounts closer to the midpoint more possible than either end, GM said.

Citing fallout from the bankruptcy, dealers said on Monday that Bank of America had downgraded its rating on GM to “sell” from “neutral” and cut its price target on GM shares to $18 from $32.

Bank of America also increased its estimate of the likelihood that GM itself would file for bankruptcy to 30 percent, the dealers said.

A spokesman for GM, which posted a loss of $2.5 billion in its North American operations in the first half of 2005, was not immediately available for comment.

GM faces many of the same problems, centering on high wage and benefit costs, that drove Delphi into bankruptcy.

Troy, Michigan-based Delphi has struggled since its spinoff, posting net losses of $741 million in the first half of 2005 alone. It had sought financing from GM and sharp cuts in wages and benefits from the United Auto Workers union to restructure unprofitable U.S. operations.

The Chapter 11 filing for reorganization potentially allows steep cuts in wages, benefits and jobs to go forward without the UAW’s approval, marking a big setback for the traditionally militant trade union.

In court papers filed over the weekend, Delphi said it would ask a judge to void its labor contracts if it cannot reach a restructuring agreement with its unions by mid-December.

Delphi, the largest U.S. auto parts supplier, said it would file motions on Dec. 16 to avoid the contracts and eliminate retiree health and life insurance benefits. It proposed starting a court hearing on these matters on Jan. 17.

The company said it plans to submit written proposed contract changes to the unions on or before Oct. 21.

Delphi Chief Executive Steve Miller told Reuters on Saturday to expect a significant reduction in U.S. employment and manufacturing operations, including dropping 4,000 idle UAW workers the company pays under its contract, and others as a reduction in operations makes them unnecessary.

The company aims to eliminate underperforming U.S. plants, which potentially includes about a dozen previously identified as unprofitable.

The start of trading in Delphi shares was delayed on the New York Stock Exchange pending news. The shares fell by nearly half in pre-market trading on the Inet electronic brokerage system, to 60 cents from a Friday NYSE close at $1.12.


http://www.msnbc.msn.com/id/9651172/

zeroday

couldnt happen to a better company.

SpeedyV6

Even though GM is often thought to be a poorly run firm a lot of their problems would be nearly insurmountable to even the most talented executives. A friend of mine who works with a mangement consulting firm that does a lot of business with automakers and suppliers told me that labor costs (including wage and benefits) at some of the firms in that industry are well over $100K per year even for blue collar employees. It's also very costly for some of those companies to lay off their employees. In some instances a layoff would require severance benefits that amount to nearly three years of pay. In many cases the companies have virtually no other choice exept to operate at close to full capacity.

KilroyR1

The problem is, they let the unions walk all over them during the "good times" and now they can't afford to pay those employees.

At some point, union leadership may understand that nobody and market a competitive product assembled by six-figure employees.

To top it off, they do shoddy workmanship.

fsttyms1

GM needs to go bankrupt. BOOT the Union out and then start making profits!

F-C

The UAW is the biggest problem for GM. Let's see how this Delphi situation shakes out.

Fibonacci

For Big Three, All the Signs Are Warnings
By DANNY HAKIM
DETROIT, Oct. 10 - Jerome B. York is looking over Rick Wagoner's shoulder, and that should make Mr. Wagoner nervous.

Mr. York, 66, is the point man for Kirk Kerkorian, the billionaire financier who in the last few months has become one of the largest shareholders in General Motors; Mr. Wagoner is G.M.'s chairman and chief executive.

Many analysts say they believe that Mr. York's emergence has put Mr. Wagoner's job security on the clock, because neither Mr. Kerkorian nor Mr. York is known for sitting on his hands. They are, in fact, reprising their roles of a decade ago, when Mr. Kerkorian was Chrysler's largest shareholder and turned to Mr. York to be his right-hand man in what became an unsuccessful and contentious takeover bid.

A spokeswoman for Tracinda, Mr. Kerkorian's private investment firm, said Mr. York would not comment for this article.

But several of G.M.'s assets are viewed as potentially expendable, people briefed on the situation said. Among them are parts of the General Motors Acceptance Corporation, G.M.'s large financial services division, including its insurance business and its mortgage business, pieces of which it has already sold.

The Saab brand is thought to not be worth further investment. Hummer is not seen as a core asset but one that should be sold.

And while there is an appreciation of the difficulties that G.M. faces, Tracinda is not expected to remain on the sidelines unless the company comes up with a more comprehensive turnaround strategy that refocuses G.M. on making fewer, but more desirable, car and truck models.

Tom Kowaleski, a spokesman for G.M., declined to comment on the company's relationship with Tracinda, but referring to Saab and Hummer, he said, "We believe both of those brands are core to our growth and our ability to bring in non-G.M. customers." Through the first month of sales of the new Hummer H3, 70 percent of the buyers have never been G.M. owners before, Mr. Kowaleski said.

Gerald C. Meyers, a professor at the University of Michigan business school, said of Tracinda, "If they think they're going to lose a big chunk of their investment, they'll be quite vocal, and there will be a sense of urgency."

At different times, both Mr. York and Mr. Wagoner have taken part in corporate role-playing exercises Professor Meyers has organized for his business school students.

"He cuts through like a surgeon," Professor Meyers said of Mr. York, who is a former chief financial officer of both Chrysler and I.B.M. "If you have a pile of numbers, he'll get right to the heart of things in a hurry, and he can make it hurt. Should Wagoner be worried? If the numbers don't speak friendly to a guy like York, it will become embarrassing. If you respond well to him, he can be a help."

G.M.'s standing was greatly complicated over the weekend by the bankruptcy filing of its former parts division, Delphi. G.M. agreed in its 1999 spinoff of Delphi to pay much of the medical, pension and life insurance benefits of Delphi retirees if the company filed for bankruptcy. G.M. said on Saturday that the filing could add as much as $11 billion to its future liabilities, more bad news for a company awash in red ink this year.

On Monday, reacting to the Delphi news, Standard & Poor's cut G.M.'s debt rating to BB-, three notches below investment grade, while Bank of America downgraded its rating on G.M.'s stock to sell. G.M. has already been battered by plummeting sales despite spending heavily on discounts, and its product lineup relies on sales of big sport utility vehicles and pickup trucks at a time when Americans are being pinched by gas prices.

G.M.'s shares plunged $2.81, or nearly 10 percent, to $25.48 in trading on Monday.

Ron Tadross, Bank of America's auto analyst, reckoned there was a 30 percent chance that G.M. would file for bankruptcy over the next two years, a more negative view than most of his colleagues on Wall Street have had. Most analysts say they think G.M. has sufficient resources to survive until September 2007, the deadline for a new labor contract, which could make or break the company.

"Time is of the essence for an owner like Kerkorian," said Mr. Tadross, adding that even in a best-case situation where the union made concessions, "if we hit a recession or the stock market is flat a few years, any combination of small-risk scenarios could make a $30 stock worth $15 or $20."

What does Tracinda have in mind for G.M.? Mr. Kerkorian's investment group has accumulated a nearly 10 percent stake in the company, as far as it can go without being considered an insider and submitting to a variety of regulatory requirements. But Tracinda has already indicated it might not remain passive, saying in a securities filing last month that it could seek a seat on G.M.'s board.

The company bought about 22 million shares between $25 and $27, nearly 19 million shares at $31, 8 million shares at $35, and a little over 5 million shares at $35.71.

"I think what Kerkorian will do is make sure he gets a guy on the board, and that could be Jerry, and he will start asking those tough questions and start prodding management," said Tom Gilman, a former top finance executive at Chrysler and a friend of Mr. York's.

Mr. York is a well-known figure in Detroit, having spent 14 years at Chrysler and having helped to turn around the company. He is known for being a tough cost-cutter, a numbers man bent on rigorous analysis.

"The combination of West Point discipline, M.I.T. analytical skills and University of Michigan business sense gives you a pretty good idea who Jerry York is," said Mr. Gilman.

In 1993, Mr. York was recruited by I.B.M.'s chief executive, Louis V. Gerstner Jr., when that company was in need of its own turnaround. Mr. York assigned hundreds of managers to cost-cutting task forces, with the goal of reaching various benchmarks set by the company's most efficient competitors. Among his achievements was turning over I.B.M.'s computer inventory 3.5 times a year, up from 2.8, which he estimated saved $2 billion.

"You've got to get people looking outside the company at customers and competitors," Mr. York said in a 1994 interview with The New York Times.

John R. Joyce, who worked with Mr. York at I.B.M. and who later also became chief financial officer, said, "if I was going to pick one word to describe him, it would be discipline."

"Whether or not you say he was too tough, I wouldn't say that, I can't say that, because that's what the organization needed at that time," he added.

Such was Mr. York's track record at I.B.M. that on the day his departure for Tracinda was announced in September 1995, I.B.M.'s stock fell 2 percent on a day that other computer stocks rallied.

Mr. York has also had his misses. He was part of a group that paid $725 million in 1999 for Micro Warehouse, a direct marketer of computers, and Mr. York served as chief executive of the company from 2000 to 2003, when it was sold to a competitor for just $22 million. It filed for bankruptcy shortly thereafter.

In Detroit, he is perhaps best known for taking part in what became a notably rancorous takeover attempt of Chrysler, after he joined Tracinda in 1995. Included among Mr. Kerkorian's group was the former Chrysler chairman, Lee A. Iacocca, who was persona non grata around Chrysler until his recent return as the company's television pitchman.

Several insiders, however, have said that the previous takeover attempt was not intended to be hostile, but only turned that way after a misunderstood 11th-hour phone call between Mr. Kerkorian and Robert J. Eaton, then Chrysler's chief executive, in which Mr. Kerkorian laid out the deal he was proposing.

"Bob Eaton said. 'Yeah, O.K., I'll take it to the board,' meaning 'I'll take it to the board and they'll probably say no,' and Kirk Kerkorian honestly believed that Bob Eaton was saying, 'I'll take it to the board and I'll recommend approval,' " said Robert A. Lutz, G.M.'s vice chairman, who was Chrysler's president during the takeover attempt.

"I think the most astonished guy in the world was Kirk Kerkorian the next day, when he got this, 'We categorically reject this; we will fight them on the beaches.' " He thought he was doing a friendly leveraged buyout with management, Mr. Lutz said, "and it turned out to be hostile."

Mr. Lutz sees Mr. Kerkorian as a bargain-hunting investor.

"He smells turnaround," he said recently to reporters. "He has an infallible instinct for getting in at the right time."

Mr. Gilman had a somewhat different take.

"Frankly, if you look at Kerkorian, his investment behavior is replicated in every investment that he does," he said. "Whether it's Western Airlines or MGM or Chrysler, he sees a large pool of cash sitting there with an indecisive management team and sees it as a chance to do one of three things," he added, referring to some of Mr. Kerkorian's previous high-profile investments.

"One would be, get the indecisive management team to start focusing on putting the money to work in the business, and in the auto business that means product, product, product. Or do a stock buyback program to drive up the share price. Or, if you're totally indecisive and can't even execute that, give it back to me in a dividend." He added: "Jerry will challenge you and analyze and challenge the management to explain the justification."

http://www.nytimes.com/2005/10/11/business/11york.html

65 Fury Convert

My cousin in Detriot, a UAW member that works for GM, sent out this email below - kinda goes along with this thread. I'd call it a propaganda letter from the union about how the union is working for them. He sent it to everyone and anyone he knows.

Sorry, no cliff notes - I read it and so can you - interesting read:
----------------------------------------------------------------------------------------------------
Monday, October 10, 2005

Five myths about today’s auto industry

Is the unionized American auto industry dead?

There are some who claim Detroit automakers are stuck in old ways of doing business and unable to compete with their more flexible Asian and European competitors.

It’s true that today’s auto companies and autoworkers face more challenges than ever. But much of what is said about the auto industry doesn’t square with the reality of what’s being done inside today’s auto factories.

For one thing, several popular vehicles that carry foreign nameplates are actually built here in the U.S. by UAW members, working with the same union contracts that supposedly make auto plants “uncompetitive.” Our members now build vehicles not only for Detroit-based automakers, but also for Isuzu, Mazda, Mitsubishi, Toyota and Volvo Trucks.

Some other common misconceptions:

Nobody builds auto plants in Michigan anymore. All the new factories are down South.
That would be news to GM, which just spent $1.5 billion on assembly operations in Lansing; to Ford, which spent $2 billion to rebuild the Rouge complex in Dearborn; and to DaimlerChrysler, which partnered with Hyundai and Mitsubishi to build a new $700 million engine complex in Dundee.

Packed with the latest technology and powered by ultra-modern conveyors, these facilities are flexible enough to produce multiple vehicle and engine models – and ergonomically designed to prevent workplace hazards and injuries.

The Big Three are going broke because their labor costs are too high.
UAW members are proud of the value we produce for employers: $463,000 per worker in a typical auto assembly plant, according to output-per-worker calculations from the Annual Survey of Manufacturers by the U.S. Bureau of the Census.

Thanks to this extraordinary productivity, the average auto assembly worker produces far more than he or she gets paid, by a margin of hundreds of thousands of dollars per worker. This remains true even when overtime, health care, pensions and other labor costs are included.

When it comes to quality, the Big Three are still way behind their competitors.
Not according to J.D. Power’s 2005 Initial Quality Study. This influential report found that the top three quality plants in North and South America are all unionized GM facilities – two in Canada and one in the United States. GM produced the top-quality performer in five vehicle segments, including the mid-size and full-size car segments; Ford was a winner in two product categories.

UAW members recognize the link between quality and productivity and job security, and we are working every day in every way to ensure that we make a difference when it comes to quality. The customers who purchase the products we build deserve no less. The quality measurement gap used throughout the industry has narrowed to a small margin, and our members are proud of that. But, until we are the very best, it will not be good enough.

Detroit builds nothing but gas guzzlers.
UAW members build the hybrid Ford Escape, the hybrid Mercury Mariner, and light hybrid versions of the Chevy Silverado and GMC Sierra. Other models are scheduled to come on line in 2007, and Ford recently announced it will produce 250,000 hybrids by 2010.

The Big Three are also using new fuel-saving technologies – like diesel powertrains, cylinder deactivation, continuously variable transmissions and lightweight materials – which can cut fuel consumption by 20 percent or more. These innovations aren’t visible to most consumers or the media. But they’re being installed on high-volume products like the Ford Explorer, the Jeep Cherokee and the Chevy Malibu, which sell hundreds of thousands of units per year. Even a small improvement in fuel economy on that many cars can make a big difference for America’s energy supply.

In a global industry, with cars coming from all over, it doesn’t make any difference what car I buy.
According to the Automotive Trade Policy Council, DaimlerChrysler, Ford and General Motors accounted for 85 percent of the total investment in the U.S. auto industry between 1980 and 2002, a total of $176 billion invested in U.S. communities. These three companies alone purchase 80 percent of the auto parts now produced in the United States.

Big Three investment and purchasing supports millions of U.S. workers, retirees and their dependents. Yet the U.S. remains the most open automotive market in the world. Forty percent of vehicles sold in the U.S. have foreign nameplates, compared to 22 percent in the Europe, 5 percent in Japan, and just 2 percent in Korea.

Additionally, the Big Three are faced with free trade agreements that allow unfair trade practices like currency manipulation which give some foreign automakers an artificial advantage. These are not complaints – just facts.

It does matter and you will find union-made vehicles in every segment and in every price range, from fuel-sipping small compacts to family-size minivans. The auto industry can have a strong future in Michigan – if we all work together to make it happen.
----------------------------------------------------------------------------------------------------

biker

Listen, when Caddy makes the interior of the CTS as good as the TSX and sells it within $1K of the TSX I'll buy it.

Fibonacci

Delphi Chief Sees GM Bankruptcy Without Wage U-Turn (Update2)
2005-10-11 06:15 (New York)


(Adds cost of insuring GM debt in the ninth paragraph.)

By Jeff Bennett and John Lippert
Oct. 11 (Bloomberg) -- Delphi Corp. Chief Executive Officer
Steve Miller said General Motors Corp., his biggest customer, will
have to file for bankruptcy if it can't wrest wage and benefit
concessions from the United Auto Workers union during their next
contract talks.
Miller took Delphi, the largest U.S. auto-parts supplier, into
bankruptcy after he couldn't get financial aid from GM and was
unable to persuade the UAW to cut pay for long-time workers by as
much as 64 percent to as little as $10 an hour.
``If GM comes out of 2007 with a labor agreement that looks
like what today's agreement is, they are inevitably headed toward
Chapter 11,'' Miller said in an interview yesterday.
Three days after filing the biggest manufacturing bankruptcy
in U.S. history, Miller, 63, outlined what he described as a
pivotal point for U.S. industrial society. Delphi's dilemma is
``simply a flashpoint and a test case'' for this crisis, said
Miller, who has steered auto companies, steelmakers and airlines
through bankruptcies over the past two decades.
The very existence of GM, Ford Motor Co. and many Detroit-area
auto suppliers is threatened by the steady increase in wages,
health-care costs and pensions that the United Auto Workers union
has won for its members since 1947, he said. Retirement costs were
manageable when workers retired at age 65 and died five years
later; they're debilitating to companies when workers retire at 50
and live 40 more years, Miller said.

Labor Concessions

Miller, who became Delphi's CEO on July 1, said he doesn't
expect GM and Ford to go bankrupt after 2007 contract talks,
predicting the UAW will accept fewer jobs and smaller wages and
benefits. The alternative, he said, would be for the UAW to cripple
GM and Ford, where most of its highest-paid members work.
GM shares, which sank $2.81, or 10 percent, in U.S. trading
yesterday, rose 42 cents, or 1.6 percent, to $25.90 today in
Germany. Delphi shares, after declining 79 cents in the U.S., or 71
percent, gained 10 cents, or 30 percent, to 43 cents in Germany.
The extra yield, or spread, investors demand to hold GM's
8.375 percent bonds in euros maturing in July 2033 rather than
comparable government securities, widened 29 basis points, or 0.29
percentage point, to 794 basis points, according to Fortis Bank, as
of 9:26 a.m. London time. The spread has widened from 577 basis
points at the end of July.
The annual cost of insuring $10 million of GM debt rose
$45,000 to $925,000 today, according to Deutsche Bank prices, the
highest since May 26, according to Bloomberg data.

`New Deal'

Delphi's Miller called on government, labor and business
leaders to collaborate on creating a ``new deal'' on health care
that wouldn't concentrate both costs and risks on individual
companies, particularly when workers themselves are opting to
switch employers more frequently.
``High wages didn't just drop out of the sky,'' said Harley
Shaiken, a labor professor at the University of California at
Berkeley. They reflected ``companies that made a lot of money while
they were paying them. The fundamental question is still who's
going to buy the cars. If autoworkers can't do it, who exactly is
going to have the purchasing power to promote demand-led growth?''
Separately, GM and the UAW are still negotiating on the
automaker's demand that blue-collar workers make out-of-pocket
health-care payments closer to those of salaried workers. GM
believes it has a legal right to cut health care for retirees
without the union's consent, but still hopes the union will agree,
Miller said.
Salaried workers at GM pay 27 percent of the cost of their
health-insurance costs, compared with 7 percent for UAW members,
said Toni Simonetti, a GM spokeswoman.

Contract Talks

Simonetti declined to comment on 2007 contract talks. She
confirmed that GM is still talking to the UAW about trimming health
costs. ``Our strong preference is to do so cooperatively with the
union, but we need to get this done one way or the other,'' she
said.
``Speculation on what may or may not happen with our UAW
contract is way premature,'' said Jon Pepper, a Ford spokesman.
GM had the right idea when it spun off Delphi in 1999, Miller
said. The automaker had reduced its labor and wage costs while
seeding a new company with ``sophisticated technologies'' to keep
new products flowing to the automaker.
Problems arose as a decline in GM's North American production
reduced revenue, leaving Delphi unable to cover the high union
wages it inherited from the automaker. GM, having cut production,
couldn't take back excess workers from Delphi as planned. That left
Delphi saddled with 4,000 idled workers that it had to pay under
contract.

`Fundamental Problems'

Delphi's bankruptcy stems from ``the fundamental problems that
have crippled the domestic auto industry: an inflexible and
uncompetitively expensive labor union, along with a toxic
relationship between automaker and supplier,'' said Credit Suisse
First Boston analyst Chris Ceraso said in a research note.
GM, Ford and DaimlerChrysler AG's Chrysler unit, the three
biggest U.S. carmakers can no longer cover ``premium wages''
because they are being undercut by the Asian and European rivals
that are paying workers less in their U.S. plants, Miller said.
``There is now such a critical mass with non-traditional
automakers in North America,'' Miller said. ``The Big Three no
longer have the pricing power, and the pricing power is being set
by the low-cost producers.
``This is what happened in steel and airlines and what is
happening now before your eyes in the automotive industry,'' said
Miller, who has helped lead Bethlehem Steel Corp. and United
Airlines parent UAL Corp. through Chapter 11 restructurings.

To the Streets

UAW members are ``resigned'' that they are going to have to
take some cutbacks, said Al Benchich, president of UAW Local 909 at
a GM transmission factory in Warren, Michigan. They won't agree to
let the company cut everything.
``People fought and died to win the benefits and wages that
we've gotten over the years,'' said Benchich. ``It wasn't just
handed to us. So now we'll probably have to take to the streets
again to keep what we've won or get it back.''
Miller said if Delphi workers strike, their plants will risk
being shut.
Rick Wagoner, GM's chief executive, has been negotiating with
the UAW to lower health-care costs and retiree benefits. Those
costs, GM says, add more than $1,500 to the cost of every car and
truck sold in the U.S.
In June, Wagoner announced the company would eliminate 25,000
jobs, or 17 percent of the company's workforce, by 2008 and close
an unspecified number of plants. The automaker also plans to buy
more parts in lower-wage paying countries to reduce costs.
Negotiations aimed at a reorganization plan filed voluntarily
with the bankruptcy judge could include bonuses to encourage long-
time Delphi workers to retire, quit or accept lower pay, Miller
said. These ``buyouts'' would enable Delphi to hire a new workforce
starting at $14 an hour, and in turn, save both Delphi and GM
money. GM will have to decide whether the savings would be
sufficient for the company to help pay for Delphi's buyouts, Miller
said.
Asked to compare his situation to Wagoner's, Miller said: ``My
problem is more urgent; Rick's problem is more serious.''

--With reporting by Ben Vickers, Chris Anstey and Hamish Risk in
London, and Alan Katz in Paris. Editor: Versical, Nol, Siler, Stets

source: bloomberg.com

Moog-Type-S

x2

CLsuperhero

They should stop SUV production or slow it down dramatically... with the prices these days no one wants them.... number 2 problem quality.....Toyotas last forever Ford last about if you're lucky a little over 100,000 then you have problems with the car.... number 3 style.... the cars they make are as ugly as sin except for high end luxury models like the caddy....I haven't seen a truely sporty car body style except for the mustang....4th is price.... make something with a V6 with some potential for tuners not a huge hemi V8 gas guzzler that only men who hit mid life crisis will buy and can afford... just my