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Bridge Loan Denied: WTF is wrong with these guys?

 
 
Bella Dea
 
  1  
Reply Fri 12 Dec, 2008 09:34 am
@maporsche,
And guess what? The number up against Japanese makers isn't quite as scary as they want to make it sound.
maporsche
 
  1  
Reply Fri 12 Dec, 2008 09:35 am
@Bella Dea,
You obviously don't understand how business works.
Bella Dea
 
  2  
Reply Fri 12 Dec, 2008 09:37 am
Quote:
So here’s a little experiment. Imagine that a Congressional bailout effectively pays for $10 an hour of the retiree benefits. That’s roughly the gap between the Big Three’s retiree costs and those of the Japanese-owned plants in this country. Imagine, also, that the U.A.W. agrees to reduce pay and benefits for current workers to $45 an hour " the same as at Honda and Toyota.

Do you know how much that would reduce the cost of producing a Big Three vehicle? Only about $800.



You are willing to sacrifice millions of jobs, put people out of work for good (because many are skilled tradesmen who can't do anything else) for $800 a car?

Bella Dea
 
  0  
Reply Fri 12 Dec, 2008 09:37 am
@maporsche,
And you obviously don't understand much of anything.
0 Replies
 
maporsche
 
  1  
Reply Fri 12 Dec, 2008 09:38 am
@Bella Dea,
What numbers are you referring to.

Toyota's compensation (retirement, hourly pay, other benefits) equal appox $43 / hour.

Using the same numbers it's GM's $70 compared to Toyota's $40.

GM's total employee compensation is 75% higher than Toyota's. THAT is one of the MAJOR problems here.
maporsche
 
  1  
Reply Fri 12 Dec, 2008 09:39 am
Oh, but now it looks like the Treasury department is going to step in and save the auto-workers.

Stupid mother-fuckers.
0 Replies
 
Bella Dea
 
  1  
Reply Fri 12 Dec, 2008 09:40 am
@maporsche,
Read the article genius.

It breaks it down for you, nice and simple.
Bella Dea
 
  1  
Reply Fri 12 Dec, 2008 09:40 am
http://www.nytimes.com/2008/12/10/business/economy/10leonhardt.html

Got buried somewhere.
0 Replies
 
Bella Dea
 
  1  
Reply Fri 12 Dec, 2008 09:41 am
You can't really punish the big three for being in business longer, can you?

Quote:
The calculations show, accurately enough, that for every hour a unionized worker puts in, one of the Big Three really does spend about $73 on compensation. So the number isn’t made up. But it is the combination of three very different categories.

The first category is simply cash payments, which is what many people imagine when they hear the word “compensation.” It includes wages, overtime and vacation pay, and comes to about $40 an hour. (The numbers vary a bit by company and year. That’s why $73 is sometimes $70 or $77.)

The second category is fringe benefits, like health insurance and pensions. These benefits have real value, even if they don’t show up on a weekly paycheck. At the Big Three, the benefits amount to $15 an hour or so.

Add the two together, and you get the true hourly compensation of Detroit’s unionized work force: roughly $55 an hour. It’s a little more than twice as much as the typical American worker makes, benefits included. The more relevant comparison, though, is probably to Honda’s or Toyota’s (nonunionized) workers. They make in the neighborhood of $45 an hour, and most of the gap stems from their less generous benefits.

The third category is the cost of benefits for retirees. These are essentially fixed costs that have no relation to how many vehicles the companies make. But they are a real cost, so the companies add them into the mix " dividing those costs by the total hours of the current work force, to get a figure of $15 or so " and end up at roughly $70 an hour.

The crucial point, though, is this $15 isn’t mainly a reflection of how generous the retiree benefits are. It’s a reflection of how many retirees there are. The Big Three built up a huge pool of retirees long before Honda and Toyota opened plants in this country. You’d never know this by looking at the graphic behind Wolf Blitzer on CNN last week, contrasting the “$73/hour” pay of Detroit’s workers with the “up to $48/hour” pay of workers at the Japanese companies.
0 Replies
 
Bella Dea
 
  1  
Reply Fri 12 Dec, 2008 09:43 am
Or you could all ignore the facts about the UAW and just believe everything you hear on tv.
0 Replies
 
maporsche
 
  1  
Reply Fri 12 Dec, 2008 09:46 am
@Bella Dea,
Look, you're making yourself out to be a fool here.

I'm wondering if YOU read the entire article.

Quote:
The calculations show, accurately enough, that for every hour a unionized worker puts in, one of the Big Three really does spend about $73 on compensation. So the number isn’t made up. But it is the combination of three very different categories.

The first category is simply cash payments, which is what many people imagine when they hear the word “compensation.” It includes wages, overtime and vacation pay, and comes to about $40 an hour. (The numbers vary a bit by company and year. That’s why $73 is sometimes $70 or $77.)

The second category is fringe benefits, like health insurance and pensions. These benefits have real value, even if they don’t show up on a weekly paycheck. At the Big Three, the benefits amount to $15 an hour or so.

Add the two together, and you get the true hourly compensation of Detroit’s unionized work force: roughly $55 an hour. It’s a little more than twice as much as the typical American worker makes, benefits included. The more relevant comparison, though, is probably to Honda’s or Toyota’s (nonunionized) workers. They make in the neighborhood of $45 an hour, and most of the gap stems from their less generous benefits.

The third category is the cost of benefits for retirees. These are essentially fixed costs that have no relation to how many vehicles the companies make. But they are a real cost, so the companies add them into the mix " dividing those costs by the total hours of the current work force, to get a figure of $15 or so " and end up at roughly $70 an hour.



Hourly Pay + Retirement Benefits + Health Insurance (etc) = TOTAL COMPENSATION = roughly $70/hr.

Even if that includes currently retired employees, it IS an employee cost that needs to be accounted for AND reduced.


Please let me know how a business can operate w/o taking into account the TOTAL COMPENSATION of it's employees.
Bella Dea
 
  1  
Reply Fri 12 Dec, 2008 09:51 am
@maporsche,
So because we take better care of our employees, we get punished? Because we've been in business longer and have far more retirees than foreign, we get punished?

You are making little if any sense.
Read what I bolded.

That is the point.

They aren't actually making that much. That number is made up based on how many retirees there are.


maporsche
 
  2  
Reply Fri 12 Dec, 2008 09:57 am
@Bella Dea,
No, because we make bad business decisions, don't plan for the future, don't sell cars that people want to buy, cave in to every demand of the union, decide not to take a pay cut, etc...we get punished.

And if I concede that we have to remove the $15/hr for existing retirees you're still looking at $58 compared to say $40 to account for removing existing retirees from Toyota.....GMs employee costs are then 45% higher than Toyota's....you're right, that doesn't sound like much at all Shocked Rolling Eyes
maporsche
 
  2  
Reply Fri 12 Dec, 2008 09:58 am
@maporsche,
OH, and on top of all of this

WE ARE BORROWING THE MONEY FROM CHINA!
0 Replies
 
Bella Dea
 
  1  
Reply Fri 12 Dec, 2008 09:59 am
@maporsche,
I'd agree that there were bad decisions made. But why are you insistant on punishing the workers?

They are not at fault here.

You punish the CEO's, you punish the workers.

You punish Joe from Detroit who works his ass off doing manual labor every day because Mr Big Shot makes more than he should.

I agree that the CEO's and the big wigs need to be knocked down a few pegs. But why do you all insist that this won't devestate the middle class?
Woiyo9
 
  1  
Reply Fri 12 Dec, 2008 10:01 am
@Bella Dea,
Toyota and/or other new or existing car manufacturers will expand and hire these workers as time goes on.

You and the politicians are short sighted. You and the Govt are afraid of losing votes and/or campaign money.
Bella Dea
 
  1  
Reply Fri 12 Dec, 2008 10:03 am
I couldn't care less about Mr Ford or the others. They've dug the hole. But I don't think that the guys who work on the assembly line and presses should suffer.

That is my point.

You come up with a way to salvage their lives, and I'll agree the bailout is unncessary.
0 Replies
 
Bella Dea
 
  1  
Reply Fri 12 Dec, 2008 10:03 am
@Woiyo9,
As time goes by?

So what are they suppose to do in the mean time?

Let's just open up our pockebooks to pay for all the welfare and unemployment checks coming our way.

The taxpayers will pay, either way.
maporsche
 
  1  
Reply Fri 12 Dec, 2008 10:04 am
@Bella Dea,
Bella, if you take away the consequences of making bad business decisions then you CREATE more bad business decisions.

These bailouts (ALL of them) are going to create a snowball effect in our economy.

If GM gets bailed out now, then they effectively NEVER have to worry about competing again. They can continue to churn through billions of dollars, continue pushing out cars that people won't buy, etc, because the US Government won't let them fail. The US Government has decided that they are too big and competition no longer matters.

I can't believe you don't see a problem with that.
Bella Dea
 
  1  
Reply Fri 12 Dec, 2008 10:05 am
@Woiyo9,
I'm afraid of losing votes?

What does that mean?

I'm afraid of losing my way of life. I am afraid of a depression. I am afraid for all the people who will be out of job. I already know many many people who've already lost their jobs. I will know many more. And not all are directly employeed by the autos. The effects trickle down. They trickle farther than the automotive industry itself.
0 Replies
 
 

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