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Thread: Union balks and $14B auto bailout dies in Senate

  1. #16
    Elite Member B.C.'s Avatar
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    Grim, when did the last 3 three loans take place? The money that has been set aside for the D3 recently for retooling hasn't been released.

    The senate wasn't asking for any concessions with the company/salary only the union. It is a shot at breaking the union. Instead of waiting for the auto czar to work with the companies and the union Senator Corker from TN wanted the UAW to take concessions which the union is willing to do but not with Corker who has a hard on to break the union and further the foreign companies in his state.


    Honda cuts North American production again

    No. 2 Japanese automaker lowers production by another 119,000 vehicles as demand weakens; no worker layoffs.

    Last Updated: December 12, 2008: 11:26 AM ET

    NEW YORK (AP) -- Honda Motor Co. said Thursday it will further cut vehicle production in North America as it adjusts to plunging automobile demand.
    Tokyo-based Honda (HMC) is reducing production by another 119,000 vehicles for its fiscal year ending March 31, bringing expected production for the fiscal year to 1.3 million units.
    Honda spokesman Ed Miller said the cuts will take place at five of Honda's seven plants in the U.S. and Canada. Employees at the plants will be given other tasks or can take paid or unpaid vacation time, he said. No layoffs will result from the cuts, he said.
    Falling sales
    Honda, the second-largest Japanese automaker, has been hurt by the global auto industry downturn, a product of slowing economic growth and tight credit markets around the world. Earlier this month, the automaker said its U.S. sales fell 32% in November and 5% for the first 11 months of the year.
    The company's latest production cuts come on top of previous reductions of 56,000 vehicles for North America announced earlier in the fiscal year. Last month, Honda said it was cutting production in Japan and Europe by 61,000 vehicles.
    Affected plants
    Miller said production will be cut by 18,000 vehicles at Honda's plant in Lincoln, Ala.; by 58,000 vehicles at its plants in Marysville and East Liberty, Ohio; by 37,000 vehicles at its operations in Alliston, Canada; and by 6,000 vehicles at its recently opened plant in Greensburg, Ind.

    U.S.-traded shares of Honda fell $1.55, or 6.7%, to $21.45 in morning trading amid uncertainty over the fate of a federal rescue of the U.S. auto industry. The Senate failed to pass a proposed bailout package Thursday. First Published: December 12, 2008: 10:32 AM
    ET
    Honda cuts North American production again - Dec. 12, 2008
    Last edited by B.C.; December 13th, 2008 at 10:21 AM.

  2. #17
    Elite Member Fluffy's Avatar
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    Quote Originally Posted by B.C. View Post
    Grim, when did the last 3 three bailouts take place? The money that has been set aside for the D3 recently for retooling hasn't been released.

    The senate wasn't asking for any concessions with the company/salary only the union. It is a shot at breaking the union. Instead of waiting for the auto czar to work with the companies and the union Senator Corker from TN wanted the UAW to take concessions which the union is willing to do but not with Corker who has a hard on to break the union and further the foreign companies in his state.
    I concur. It was totally a union-busting move by the GOP. All auto sales are down this year. GM, Chrysler & Ford are down by 40% and Honda, Toyota and Hyundai (and other foreign autos) are down by 30%.

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    Elite Member RevellingInSane's Avatar
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    Maybe the UAW should be broken. The auto industry must cut costs and UAW wages must be lowered.

    If they can't see that, then 3 million will suffer.



  4. #19
    Elite Member Fluffy's Avatar
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    If G.M. Was a Canadian Company It Wouldn't Be Asking for Help

    by Dean Baker

    The Detroit automakers have made many mistaken business decisions that have been important factors contributing to their current crisis. However, they are not responsible for some of the factors that have brought them to the brink of bankruptcy.

    Most obviously, they are not responsible for the collapse of the housing bubble and the subsequent loss of more than $15 trillion in housing and stock wealth. This falloff in wealth has sent consumption plummeting. The auto industry has been especially hard hit, with sales falling by more than 30 percent year over year in the last two months.

    The Big Three are also not responsible for the broken U.S. health care system. If we paid the same amount for health care as Canada, G.M. would have accumulated an additional $22 billion in profits over the last decade.

    That would be the savings if we assumed that General Motor's health care expenditures were reduced by roughly 48 percent to be in line with expenses in Canada. Of course, not all the savings in this counterfactual would have gone to profits. Some of it would have gone to workers in the form of higher wages or to consumers in the form of lower car prices.

    On the other hand, G.M. is also picking up the tab for many spouses and dependent children. It would not have to pay these health care expenses in a Canadian type system. So the $22 billion figure is probably not a bad first approximation of the additional money that G.M. might have today if the United States had a more efficient health care system.

    Even with these additional profits G.M. and the other domestic manufacturers would still face serious problems. They have made some bad choices in betting their future on SUVs and other low-mileage vehicles. They also have lagged foreign manufacturers in producing high quality, reliable cars.

    But the real reason that Big Three are on their deathbeds right now is the economic crisis created by the Wall Street crew and their friends in Washington. It will be tragic if the people of the Michigan, Indiana, and Ohio are made to suffer through a depression because of the failed financial dealings of the Wall Street crew.

    This situation is made even worse by virtue of the fact that most of the Wall Street executives who are directly responsible for this disaster are still quite wealthy, in large part because of the generosity of Congress and the Bush administration. While they demanded that the auto manufacturers produce plans for returning to profitability in exchange for providing loans, no similar conditions were imposed on Citigroup and the rest of the Wall Street gang.

    As the autoworkers at the Big Three look at their last paychecks before an indeterminate period of unemployment, they should think about the portion deducted for income taxes. With this money, they have helped to ensure that Robert Rubin and other Wall Street types continue to enjoy pay packages in the millions or even tens of millions of dollars.

    Happy Holidays!

    Dean Baker is the co-director of the Center for Economic and Policy Research (CEPR). He is the author of The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer (The Conservative Nanny State). He also has a blog, "Beat the Press," where he discusses the media's coverage of economic issues. You can find it at the American Prospect's web site.

    If G.M. Was a Canadian Company It Wouldn't Be Asking for Help | CommonDreams.org
    Quote Originally Posted by RevellingInSane View Post
    Maybe the UAW should be broken. The auto industry must cut costs and UAW wages must be lowered.

    If they can't see that, then 3 million will suffer.
    UAW has already made concessions. I don't recall Wall Street making many concessions when they got $700 billion.
    An extra dose of humiliation for Detroit: Sweden is bailing out its own domestic automakers, Volvo and Saab, even though they are owned, respectively, by Ford and G.M.! Little old Sweden is bailing out Detroit's mistakes, while Senate Republicans play the fiddle and watch the economy burn.
    Senate GOP to UAW: Drop dead - How the World Works - Salon.com

  5. #20
    Elite Member Grimmlok's Avatar
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    uh guys, the big 3 up here ARE asking for help and the government so far is saying "show us how you're going to change first"
    I am from the American CIA and I have a radio in my head. I am going to kill you.

  6. #21
    Elite Member greysfang's Avatar
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    The terrible thing is, we don't get much Canadian news unless you guys tell us, or its big enough to get on CNN.
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  7. #22
    Elite Member Fluffy's Avatar
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    Quote Originally Posted by Grimmlok View Post
    uh guys, the big 3 up here ARE asking for help and the government so far is saying "show us how you're going to change first"
    That wasn't the point of the article I posted with regards to Canada. Retiree health care is one of the big benefits (and also one of their huge costs) the big 3 are contractually obligated to provide. If they didn't have to provide health care to their workers, they would be more efficient companies.

    Thursday, Dec. 11, 2008 14:14 PST
    Senate GOP to UAW: Drop dead

    So many ills are afflicting the U.S. economy right now that to single out any particular indicator as responsible for depressing investor sentiment is foolhardy. But let's just say, for the sake of argument, that the news that Senate Republicans nixed the auto bailout was the guilty party in triggering Thursday afternoon's 200-point fall in the Dow Jones industrial average.

    If so, the drop might stand as the first verdict of history on what may be remembered as an epochal event and, potentially, a huge blunder. If the Senate Republicans really have killed the bailout, and if, say, General Motors is indeed forced into bankruptcy before President-elect Obama takes office, isn't there at least a chance that a collapse so massive could propel an already crippled economy into a near-death state?

    Attentive readers know that I have gone back and forth over the bailout-vs.-bankruptcy question. I'm not confident that a "car czar" could successfully restructure the industry in a new profitable form. I have never been a fan of Detroit's long-term strategy, and have always been incensed at the opposition of the Big Three to increased fuel economy standards and efforts by states such as California to reduce greenhouse gas emissions. They don't deserve a bailout.

    But then again, neither did Wall Street. The presumption, as we were told by the likes of Senate Minority Leader Mitch McConnell, R-Ky., was that the consequences for the greater economy would be simply too disastrous if we just stood by and watched as the financial titans whose own greed and irresponsibility created this mess crashed and burned. And that was back in September, several months before the economy started losing half a million jobs a month (a number that seems sure to go up judging by today's awful jobless claims figures). The U.S. economy is in much worse shape than it's been for at least a quarter-century, and appears to be unraveling at terrific speed. Thus, an even more timely case can be made for saving Detroit as was offered for Wall Street. Does it really seem like right now is the best time to see what happens if G.M. declares bankruptcy? As a worst-case scenario, might not it be better to help Detroit limp along for another year or two, until we see whether we can get out of what our current president not too long ago called "a rough patch"?

    Both Bush and Obama agree: Doing nothing is a bad idea.

    From the New York Times:
    "We believe that the economy is in such a weakened state right now that adding another possible loss of one million jobs is just something our economy cannot sustain at the moment," Dana Perino, President Bush's chief spokeswoman, said at a news briefing.

    Mr. Obama sounded a similar theme.

    "I understand people's anger and frustration at the situation our auto companies find themselves in today," Mr. Obama said at a news conference in Chicago ... [but] at this moment of great challenge for our economy, we cannot simply stand by and watch this industry collapse. Doing so would lead to a devastating ripple effect throughout our economy."
    And yet, now, none other than Mitch McConnell tells us enough is enough. There's no sugarcoating this one -- what's good for Wall Street fat cats is not good for unionized Midwestern workers. It's hard not to agree with the Detroit Free Press: We're witnessing payback time for the UAW. Republican senators are on the warpath against organized labor.
    Over the last decade, the UAW has spent more than $10 million to elect Democrats and defeat Republicans -- some of them the same GOP senators now being asked to rescue the domestic auto industry ...

    Sens. Richard Shelby of Alabama, Bob Corker of Tennessee and Minority Leader Mitch McConnell of Kentucky represent states where foreign automakers have significant operations and the UAW has less sway than in Michigan or Ohio. Each also has been the target of considerable political support from the automakers' union flowing to Democrats who have opposed the senators in elections.

    Complicating matters for the union -- which has been lobbying hard for passage of the rescue plan -- is that it threw its political weight behind many of the Democratic opponents who managed to beat Republican incumbents last month. Now those same defeated GOP senators are being asked to save the domestic auto industry from ruination before giving up their seats.
    An extra dose of humiliation for Detroit: Sweden is bailing out its own domestic automakers, Volvo and Saab, even though they are owned, respectively, by Ford and G.M.! Little old Sweden is bailing out Detroit's mistakes, while Senate Republicans play the fiddle and watch the economy burn.

    It seems hard to conceive that G.M. and Chrysler could not somehow manage to totter forward just one more month, when Obama will take office with a significantly strengthened Senate majority and presumably a much more potent bully pulpit. And perhaps there is still some last-minute backroom dealmaking going on in the Senate. But it's not so difficult for me to imagine looking back at this point from the perspective of a future historian detailing the events that led up to the Second Great Depression, and deciding to pinpoint the abandonment of Detroit as yet another grievous error that ensured a patient barely holding it together on life support went terminal.

    ― Andrew Leonard

    Senate GOP to UAW: Drop dead - How the World Works - Salon.com

  8. #23
    Elite Member B.C.'s Avatar
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    UAW President explains the union position on the fallout of the talks with Senate.


    Save Auto Jobs: UAW news conference videos, 12.12.08

  9. #24
    Elite Member Grimmlok's Avatar
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    Every company should be obligated to provide healthcare.. the problem is, american health care is run by corporations who crank the prices up to astronomical levels to make a buck.

    Your health system needs reform too.

    Still, that doesn't excuse a product line from all 3 that isn't competitive
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    Quote Originally Posted by Tijuana Small View Post
    Don't American cars suck, anyway?
    To me that's the real problem in a nut shell. If they made a product people wanted to buy then they'd make money. Look at the Toyota Prius....they cant make them fast enough. They've done it in the past with the Mustang. But they have been very resistant to alternative power and to increasing the gas milage. Combine that with terrible el cheapo interiors and the only people who will buy them are rental companies.

  11. #26
    Elite Member Fluffy's Avatar
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    Quote Originally Posted by Grimmlok View Post
    Still, that doesn't excuse a product line from all 3 that isn't competitive
    They were competitive a few years ago when that was all Americans were interested in buying.
    Quote Originally Posted by scooter View Post
    To me that's the real problem in a nut shell. If they made a product people wanted to buy then they'd make money. Look at the Toyota Prius....they cant make them fast enough. They've done it in the past with the Mustang. But they have been very resistant to alternative power and to increasing the gas milage. Combine that with terrible el cheapo interiors and the only people who will buy them are rental companies.
    It's not like Toyota is having its sales skyrocket this year. Toyota's sales are down 30%. GM does have an electric/hybrid model that is supposed to hit the market in 2010. I'm not a fan of American cars generally, but that doesn't mean the entire automotive industry in the US should be laid to waste. They have made a lot of improvements in recent years. When the automakers were on Capital Hill last week, they said they were going to scrap several product lines as a way to revamp their companies. Even if the Senate passed the automotive bill this week, the big 3 were still going to close several plants. The automakers were far more willing to make concessions to redo their industries than Wall Street was in September/October.

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    Quote Originally Posted by Tijuana Small View Post
    Don't American cars suck, anyway?

    no, i have a 1999 v-6 ford mustang with 117,000 miles
    harrison II is doing very well for an older car
    the problem , i had with car is the radio/cd player died


    my first car was a 1989 mustang (harrison I) made it to 115,000 miles

    american autoworkers are making good cars
    they have a crappy union
    the car owners need to have care of the cars and follow the maintance manuals

  13. #28
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    On the subject of the Toyota Prius, one fact they gloss over is that the batteries eventually need replacing and it costs a fortune.

    US car makers have dropped the ball when it comes to providing a product that people actually want. It's not only a value for money or running costs or aesthetic thing. I think the "eco" message has got through to a lot of drivers and they are choosing smaller, more efficient and economical cars these days. There's almost an inverted snobbery about being seen in a daggy Prius instead of a fuck-you Cadillac (unless you are a pimp).
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    Gold Member ymeman's Avatar
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    Quote Originally Posted by B.C. View Post
    As a union member I can say I, as my union brothers and sisters are on your side, the side of working Americans.




    http://www.aftermarketnews.com/Item/..._struggle.aspx

    It's the damn legacy cost, period..Wages are very comparable.

    The 'union threat effect'

    Harley Shaiken, a professor at the University of California, Berkeley, who specializes in labor issues, said Toyota's high wages are somewhat expected.

    "Toyota pays high wages in part to avoid the UAW," Shaiken said, adding that economists would refer to Toyota's high wages as the "union threat effect," meaning companies pay union-comparable wages to fend off organizing efforts and the risk of a strike.

    "But what Toyota inadvertently shows," he added, "is that you can compete paying higher wages."

    Assembly workers for Detroit automakers last year remained a bit ahead of Honda's U.S. hourly workers, who made an average $24.25 an hour, or $26.20 with the $4,485 bonus they received. In November, Honda paid bonuses for the 21st consecutive year, the longest streak in U.S. auto history, said Ed Miller, Honda spokesman.

    Nissan workers are paid $24 an hour in Mississippi and $26 an hour in Tennessee, but company officials would not disclose employee bonuses.

    Hyundai Motor Co. pays its U.S. production workers less than other automakers. Wages at its Alabama plant start at $14 an hour and grow to $21 an hour after two years on the job, according to a January 2004 company release. Hyundai declined to say whether those wages have increased since then.

    But the UAW's Casteel, who is working to organize autoworkers in southern states, said the UAW's recruiting strategy of comparing union and nonunion checks doesn't work in less-developed parts of the South. In Alabama and Mississippi, for instance, the U.S. Department of Labor says wages average less than $11 an hour.

    "If you start looking at where they put these plants, they go out to the most desolate places you've ever been in your life," Casteel, an Alabama native, said of foreign automakers. "And they make sure there are no other competitive wages with any other industry. You'll drive through these piney woods for an hour and all of a sudden you run upon this major manufacturing facility."

    my the prior generation of my family was union on both sides and it's the only reason they were able to have a decent middle class wage/life. I worked in one of those plants that just made parts for the cars and between that plant and a few others they supported thousands of familes in that area. Getting into those plants for those local people is like winning the lottery, and there is nowhere else around that offers a living wage. I'm just talking about the smaller plants that make a few components of the car, not the carmakers themselves...I'm sure this is true all over the U.S. and it's pretty horrifying to me to think about what will happen to these families when these plants close because the parts aren't needed anymore. Really, really, sad.

  15. #30
    A*O
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    So why are the unions vetoing legislation that will protect their members' jobs?
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