UAWhat?

Disclaimer by which you can judge my bias (DBWJB, it's a shame it isn't more catchy, i might still trademark it...): Apart from my profile... My father is an engineer for General Motors. I follow the car industry closely in a lot of countries. And last but not least, this will sound more pro-UAW than I really am, at least at the start.

Background: Delphi filed for bankruptcy recently, and the linked article says a lot of what I want to say, so I shall try not to repeat myself. Only for tree-huggers: GM is a world class car manufacturer, as good as Toyota, BMW, and VW among others. It does just as much research, if not more than Toyota on everything you'd like (cleaner environment) and more. i.e. it sells hybrid buses to cities and actually makes money on it, as opposed to Toyota losing around $1500/Prius. The Prius is more marketing for Toyota than an actual product, and the sooner people snap out of Toyota marketing BS the better.

The most important thing to remember when it comes to the wages in the auto industry is that Henry Ford paid his workers $5/day because he wanted the workers to be able to buy the cars made by Ford. He was able to sell mass produced, cheaper cars to newly created consumers who could afford cars, his employees. Ford employees unionized after GM and Chrysler.

That is a noble goal for a car company, The founder of Maruti, before it became Maruti Suzuki and now Maruti Udyog, in India had just as noble a goal, as do most car companies today, especially the Korean ones. Thanks to globalization, a flood of new cars, but not enough new markets to sell them in (relatively speaking to GM's past), along with some of GM's own bad designs gives GM a 30% chance of bankruptcy in 5 years, and a 58% in 10 years. The probability of bankruptcy actually increasing over time instead of decreasing, can't be good.

The mistakes GM has made, has a lot to do with it's market share going from 35% to 26% in the last 15 years or so. Bigger cars are actually forgivable in my book, since building them is cheaper, they're sold cheaply, and almost every would actually rather have a bigger car (think of places other than the US, Europe). A lot of time/money/effort is saved by building a big car rather than two little ones (generally speaking, kind of like McDonald's, until recently, selling bigger hamburgers). Consuming more gas is a natural consequence, not controlled by GM. Now, Re-badging one minivan to four divisions, which can't compete in the first version, is not a good way to get a good return on investment. Improving the initial design year after year is. GM also invested in Daewoo, and Fiat, Fuji, where it lost loads of money.

That $5 in 1914 would be around $100/day in 2005, which, for an 8 hr work day = $12.5/hr. Which is around what the market wage is for manufacturing work today in the US. UAW employees get at least twice that in salary, and around four times that including health care compensation. During holidays and overtime, if they can work, they get 2-3x the $25/hr base pay. This is for repetitive assembly line work, which is safer than it should be, because the engineers that design the manufacturing process get blamed for a worker's incompetence and have to account for it, among other things. This is a safe job, made safe by the engineers who design the car and the accompanying manufacturing process. VW assembly line workers in Germany go though at least 2 years of specialized automotive classes before they are hired. While UAW workers receive minimal training, and a guarantee by the union steward that as long as they show up on time, they won't get fired. Lets not even get into productivity.

Until new markets are created, GM is stuck between a rock and a hard place, since thanks to the labor contracts with the UAW they can't close any plants, or pay the workers any less. They're stuck with overcapacity because they can't sell all the cars they make.

So, through the downturn, There have been no cuts in either Health care or salary benefits for UAW workers. All the while, the health care for GM's white collar workforce has actually gotten noticeably worse. This is the main reason, I am completely against Unions, especially the UAW.

While I'm on the subject, from America: The Book, A citizens guide to democracy Inaction:
Hello my name is: The Labor lobby (AFL-CIO, et al)
Money Given in 2000: $90,152,281, more than half in the form of goods that "fell off the back of a truck."
Represents: The working man and woman (Monday-Friday 8-4, off weekends and holidays)
Recipients of their largesse: Rust Belt Democrats who enjoy posing on forklifts.
Stated Agenda: To keep the working man from getting screwed.
Hidden Agenda: To keep the working man from working.

Which is true, like everything else in the book. The unionized people want to get paid more, not create more jobs. Simple micro economics says more people will be employed in a company if individuals in the same company get paid less. I'm not talking about the extreme cases.

And the UAW agrees to concessions...

This is all way too simplified and summarized, Thank you for reading.