This proves that bigger is not better. It’s a problem. This vid is a propaganda piece done by the big 3.
Support the Blog — Buy This Book!
For Kindle and with free ePub version. Only $9.49 Great reading.
Here is what Gary Shapiro CEO of the Consumer Electronics Association (CEA) said: Dvorak's writing sings with insight and clarity. Whether or not you agree with John's views, he will get you thinking and is never boring. These essays are worth the read!
Put this ad on your blog!
Syndicate
Subscribe to Main Blog feed here:
Subscribe to Comments too (below):
Junk Email Filter
# 21 Paddy-O said, “And you think that preventing foreign cheaper better products from entering the US market is going to increase the standard of living for low skilled workers in the US?”
The answer to your exact question is subject to much debate and in my mind has not been answered yet. However auto workers are generally not low skilled workers. In normal times if one of the old big 3 went bankrupt the stock holders would be wiped out and some group of investors would re-capitalize the business, renegotiate labor contracts and continue on. Which in general would have little effect on the over all economy. However what we are talking about now is not the same the experts believe that if the old big 3 move into bankruptcy no one is going to be able to re-capitalize them and the bankruptcy would quickly move from a reorganization to a liquidation, with parts supplies to follow and then foreign own manufacturing plants next. Effectively the whole industry would leave the US and we would import all of our vehicles. This is what is unacceptable and why the government can not allow it to happen.
#26 – Mr Fusion – I didn’t write the article. Just quoting from it.
The article is correct in stating that a Cavalier or Taurus has suffered by not advancing, technologically, with the times.
In the fleet vehicle industry, the Cavalier & Taurus are highly used – and gotten rid of – before 4 or 5 years.
Cheap to buy, but get rid of before warranty’s end.
Sales numbers don’t lie. I know of ZERO people in my age group (thirty-something) that actually own & prefer Big 3 cars.
Minivans (Ford & Chrysler) being the exception.
However, nearly everyone I know over 55 drive Big 3 – and are proud to show the Union sticker in the window showing it was assembled in the US or Canada.
Assembled being the keyword…
# 33 atmusky said, “The answer to your exact question is subject to much debate and in my mind has not been answered yet. However auto workers are generally not low skilled workers.”
Go walk an assembly line and see what the workers DO.
As far as not letting them fail due to econ fall out, they won’t survive because of a hand out. That only postpones the inevitable. The reason they are failing isn’t because of lack of hand outs. Thus, a handout doesn’t address the problem.
Putting bandages on someone who keeps jumping into the shredder doesn’t solve the problem of them getting cut up…
The effect of the auto industry doing poorly is very real. You have so many services that depends on autos for their business. Having said that, however, I would love for them to go down and restart from scratch without the unions. This can’t be done without them crashing completely. Sadly, they’re not going to collapse, imo, because the government will bail them out with tax payer’s money. I hate having to help out people who continually make bad decisions that affect not just themselves but everyone and everything that stems from the business.
I understand some people’s concern about having good wages but the wages have to be competitive. You have some of these machine operators getting paid upwards of $30/hr while operators from other industry sectors are getting half of that. How fair is that? Some Engineers don’t even get that much per hour! While the auto industry is not the only one, Boeing being another, there needs to be a realization that these workers are getting way too much for similar positions.
Here’s what I currently hate about the US auto companies. Now that oil is getting cheaper they are rumoring that they might not even consider green vehicles >.>’ Ford has already stated that they are still going to wait and see how these hybrid and electric vehicles are going to do and are skeptical of the Volt. Meanwhile, Volt is rumoring to be place on hold because of the oil drops ><! I don’t care much for the volt but I do care that they at least start something in the direction many of us want them to head towards. Ford’s comment, obviously, is complete BS as they have many vehicles that are running 30+MPG. They’re just not sold over here. This kind of BS talk is something we don’t need to support.
#8, if you know what is going on with the auto industry some of the stuff they are saying in the video contradicts what has and is happening. John doesn’t need to state or comment on what is already obvious.
First let’s see upper management tighten their belts by taking pay cuts.
I’ll wage there is a billion right there.
Next, eliminate the executive pool to say one or two per division.
There’s another 500 million.
Now drop the price about 5-7k per vehicle. That way more people could afford a car, maybe two, and they will make up the loss by selling more units. Some income is better than NO income.
Eliminate 1/4 of all dealerships. There truly is no reason for a county to have more than three dealers that sell the same brand of vehicle.
Add more partnetships with companies to subsidise the cost. A Google or Apple sedan with wifi would get the techies creaming their dockers. A Wal-Mart minivan for those on the rual side of the coin could work as well. Get Creative.
Start a social network for certain models. Get some named people in on it (possibly give them a freebie) make it COOL and HAWT to be connected with all the other owners. (Can we see a Dvorak.org/blog Lincoln?)
Try some these first. If they still don’t work, THEN come back and ask. I want to see an EFFORT put into it.
Cursor_
# 37 Cursor_ said, “First let’s see upper management tighten their belts by taking pay cuts… etc., etc.
GM alone has a $51 billion unfunded obligation to health care for retirees.
You don’t understand the scope of the problem, by a billion miles…
Ask where your job or pension went after the economy collapses under the economics of the years since Ray Gun introduced his trickle down crap.
# 39 qsabe said, “Ask where your job or pension went…”
Like the SS fund that has been raided by every congress for the last 40+ years?
Parts made in Mexico, Indonesia, Taiwan, ALL shipped to the USA, and put together by USA workers(?), with a PROFIT MARGIN that says MADE IN THE USA, at a USA PRICE..
If we can FORK our manufacturing and Personnel from other countries to do the WORK, WHY cant the CEO, board members get WAGES like those in OTHER COUNTRIES..
How many MILLIONS per year could they have saved?
# 41 ECA said, “How many MILLIONS per year could they have saved?”
Not nearly enough to outpace the higher union employee costs in the US…
From a hometown newspaper, but the facts are easily checked:
http://tinyurl.com/67fbr9
How about bailing out of their pockets?
I’m pretty sure all the top earner at GM could come up with that money to bail them self out.
Paddy,
Then a lousy 25 billion won’t help that.
So your point then is?????
Cursor_
42..
OK..
How many $70 per hour employees for $1million
7…
How many HIGH pay’d BOSS’s can you fire for that $1million.. <1.(lessthan 1)
Maybe the suppliers can bail them out. According to my math they profited $102 billion. BTW I want a job with those suppliers $90K annually sounds pretty good. 😀
# 45 Cursor_ said, “Paddy,
Then a lousy 25 billion won’t help that.
So your point then is?????”
The point is, don’t waste $25 billion of the tax payers.
Wave bye-bye, US! BYE-BYE!
http://tinyurl.com/633js8
Break them up and make everybody from the top to bottom work for much less.
Maybe the suppliers can bail them out. According to my math they have $102 billion floating around. I’d say about 25% of that for expendures beyond the $54 billion in salaries. BTW I want a job with those suppliers $90K annually sounds pretty good. 😀
@37 Cursor
“Eliminate 1/4 of all dealerships.”
You sir, are an idiot.
You know .. General Motors and Ford don’t own the car dealerships.
What the F does cutting the number of car dealerships — which aren’t owned by GM or Ford — have to do with company profits and losses?
Half the clowns here post crap they don’t know what they are talking about, but this one takes the cake.
HMeyers,
They supply the dealerships or do dealers manufactur the vehicles?
Just as McDonalds can hose a franchise that is screwing up, so too can a manufacturer hose a dealership.
No inventory means they go and sell something else. Issue solved.
I am very well versed with franchises and a dealership is no more than that.
Cursor_
I shouldn’t have so rudely worded my response, I apologize for that.
Dealerships have contracts and retain exclusive rights to market.
Car dealerships that sell new cars from the American car manufacturers conduct business little different than an a dealership selling foreign cars.
The dealerships sell plenty of cars. Toyota took nearly as large of a sales drop as Ford and General Motors.
However, Toyota makes an incredible amount of money in the car manufacturing business whole Ford and General Motors lose incredible amounts of money.
Toyota, Honda, BMW and nearly every foreign manufacturer else build a ton of their cars in plants in the United States, so this isn’t a failure of American workers.
Nor is it a failure of the dealership system.
As you noted, although rare and some infrequent especially with US automaker dealerships due to a mature and long established history.
The problem is, Ford and GM have to do $1000 rebates or 0% financing — in effect subsidizing their sales — because they cannot sell their products at a profit.
The rest of the car companies — whether Asian or European — are able to sell their vehicles at a profit.
Let ’em go under. It’s a natural cycle. All that I got out of the propaganda was that either we pay now or we pay later. No matter what happens we pay so let the chips fall where they may and may the fight go to the fittest.