Rt.66: GM was following an unsustainable business model. Wagoner, the CEO who was ousted by Obama, has repeatedly said as much and one of his primary areas of focus was to try and work with UAW and AFL-CIO on renegotiating the CBA, specifically the health benefits section.
Unsustainable in a climate of dwindling (to Asia) market share maybe. If the American public appreciated a 100 year old symbol of US greatness and supported US workers and GM products they could provide good jobs and benefits and pensions as long as the support was there.
The pension/healthcare liability tail that GM was carrying was massive and resulted in those significant legacy costs that you referenced.
Been over this, yes we had those costs, yes the US Gov. failed to prevent predatory trade partners from turning a good thing (good jobs, benefits, pension) into a weakness.
However, how can you be willing to recognize those legacy costs and yet not be willing to admit that they were part of an almost suicidal bargaining approach by UAW and AFL-CIO? I’ve heard you and PaddyOh talk about a “reasonable” wage for auto workers. They weren’t paid a reasonable wage, though. When you calculate salary AND benefits, they were being paid far in excess of “reasonable”.
Those $70 an hour MSM BS numbers you hear include legacy costs. They add up the cost of the current workers, their benefits PLUS the costs of retired workers collecting benefits then divide it by the total number of current workers. Is that how you figure your pay? Do you add your company’s pension and retiree healthcare costs into your salary? Of course not, but its good PR to get the UAW hate machine revved up.
and this has been going on since the 1950s, when GM initially folded under union pressure (and pressure from the government). GM could afford those wages in the 1950s, when GM had nearly 60% US market share and no foreign competition to speak of. Unfortunately, time and competition caught up and GM’s domestic market share has eroded to about 28%.
GM lost market share and had an increasingly hard time supporting good American jobs, benefits and pensions, on this we agree.
To accuse those tens of thousands of Americans of somehow being traitors for buying a foreign car is not only false,
False huh? If they had bought GM products instead of Hyundai, Toyota, Honda, Mazda, Nissan, Kia, Subaru by the millions then we would not be having this debate.
it ignores the fact that GM lost those customers by failing to deliver on it’s central premise for existence: Well designed, well made and affordable cars that people would WANT to drive.
BS, GM builds a great car. It’s the biggest lie ever perpetrated on the working class of America that those dumb beliefs about poor quality proliferate.
When was the last time you drove ANYWHERE and witnessed American cars broken down on the road side? If you are honest you will agree that seeing any car broken down on the side of the road is really, really rare and when you do its just as likely to be a BMW, Toyota, Nissan as any US make.
ALL cars sold in the US are CRAZY reliable, that’s the truth, love it or hate it. If a car these days does need repair it usually never involves a tow truck. It’s usually a squeak, an electrical issue, malfunctioning accessory, etc. , but nothing that prevents you from getting to work. Does anyone really believe Toyota repair shops are empty? So we chant for the death of our industry based on what? Internet BS statements that GM sucks, which are completely contrary to what our EVERYDAY eyes and lives tell us?
So, be honest, if you chose an Asian car this is reality, not the outrageous statements you read from those with deep seeded guilt issues over sending $20,000 or $40,000 to Japan or Korea, to support Japanese and Korean schools, roads, libraries, social services, etc. (and contributing to job losses in their own country).
You’re almost Stalinist in your demands that we drive American or face the consequences of our misguided actions. This is a free, capitalist society (or at least it used to be) and companies live or die based on their ability to deliver attractive choices to consumers. Simple as that. Great design + great engineering + great construction = WINNAR (sorry, FLU, couldn’t resist). Think iPod.
You are correct, we are free to choose to send our money and jobs overseas and our Government will help us do so. It’s also correct that if you live in our trading partner’s countries the Gov. does not assume you can make such a decision and restricts imports. They get surpluses and jobs; we get deficits, unemployment and freedom of choice. You decide who has a better system. Usually ones oppinion to this is directly related to the proximity of potential job loss to THEMSELVES.
GM has the design and engineering chops to deliver great products, especially with Bob Lutz on board. However, it has become hidebound, bureaucratic and too slow to keep up with the times.
Patently false. I drive a Buick and a Dodge. I often end up driving a friend or family member vehicle when they need to use my supper reliable, quite, solid, powerful Dodge truck to move, haul stuff or tow stuff. I drive Honda’s and Volkswagens and Nissans. I rent cars just like everyone else and sometimes get an Asian car. So, I know what is out there and I know that Asian cars have their strengths and weakness just like US vehicles.
Let’s fast forward 20 years. How many Asian cars will you see at the Good Guys car show at Del Mar?
Zero, of course, just like today.
How many of today’s American cars will people keep for generations and still have pride in 20 years? Short list off the top of my head:
The new Camero
The new Challenger
Dodge Charger R/T
The new Vette
Many Cadillacs
Dodge Hemmi trucks
Crew cab diesel 4x4s
Saturn Sky
To ascribe GM’s fall to these nefarious foreigners misses the larger picture and glosses over many of the salient facts in the story. GM could have easily crushed Honda, Toyota, et al in their infancy. It didn’t because, in it’s arrogance, it failed to take them seriously and didn’t deign to compete with cheap “Made in Japan” econoboxes. Then OPEC and the “oil shocks” hit and the game changed and GM was caught completely flat footed. AGAIN, it could have used it’s economies of scale and residual consumer loyalty to put it’s now growing Japanese competitors out of business by designing smaller, more fuel efficient and better designed cars. It didn’t, choosing instead to keep manufacturing large, fuel-inefficient clunkers. You opined once that the 1970s weren’t an automotive glory period for any car maker. That conveniently ignores the fact that GM, Ford and Mopar designed some of the best looking, best produced cars in the world in the 1950s and 1960s. By the 1970s, they had gotten fat, lazy and prideful and their Japanese competitors saw and exploited that opening.
The rest, as they say, is history. And now so is GM. Welcome to capitalism.
Wrong again. US policies, US policies. After the war our Gov. wanted to rebuild Japan and wanted them to succeed and made sure they did. We made the Japanese auto industry. We built their factories, gave them our assembly technology, sent then knock-down kits to get them started and then allowed then to completely eliminate foreign car makers from the Japanese markets for decades while they built what they have today. American car buyers don’t seem to hold that against Honda, but heaven forbid we help our manufacturers in such a way. So, its not that GM was dumb and Toyota was smart so much as Gov. policies protected and encourage Toyota and discourage GMs success.
Welcome to Government policies that have/will cost us hundreds of thousands of jobs directly connected to the auto industry and many, many more that most people will never connect.
