US Automotive bailout fails in US Senate

[b0son]

Originally Posted by Ohio XB

I cannot imagine any self respecting, medical college degreed PhD that is doing genetic and cellular research working for this amount, at least not in the US.

Many have and many continue to do so. A postdoc position in the US or Europe is expected as valuable work experience prior to coming back here in search of an academic position.

I knocked back a job to work for a research lab in NY for $24k in 2002 (labs in the midwest offered 20-21k). Since then, the NIH offering mid-high $30's has forced the salary up (though not everyone is funded by the NIH, and some postdocs still get paid in the $20's), but its still significantly less than the average UAW worker.

[b0son]

Originally Posted by Ohio XB

In my experience, and what I see most from reliable sources, and what I read in the contract, the line workers get $28/hr USD.

Thats an absurdly high wage for a comparatively low-skill job. Just because a union is in a position to extort such a pay rate from the employer, doesnt mean it's right to continue to do so.

As far as other car companies (foreign-owned) being able to offer those rates, so what? They clearly have a better run business and more relevant model line-up to be able to do so and still remain in business. One seldom hears little but disdain for American automotive product - perhaps you guys need to fix that, THEN reward yourselves with world's best pay and conditions.

Out of curiosity, factoring in the health plans and pensions, what is the total cost of a line worker in a US-owned plant versus a foreign-owned plant?

[irlewy86]

Originally Posted by Gobes32

Hi Ohio XB,

One of Australia's biggest beefs with the UAW especially within Ford Oz is the perception whether true or not, that the UAW block all our attempts to send Australian built cars overseas to the states. On many occasions it has been reported that the UAW have blocked attempts for Holden and Ford to send cars o'seas. If i remember correctly the Monaro (GTO) was only allowed to come over in very limited numbers after a lot of bending over by Holden and GM. When ford management in Australia are asked in information sessions why don't we send the Territory to the states the answer has been that the UAW would never allow it (because it makes the crap that Ford US churn out look like the garbage it is...........)

Australia has a vast union backed workforce so we are not a country of union haters, but some of the stories (lies?) we hear about the UAW down here makes us shake our heads in amazement.

I always thought the real reason the Territory was blocked because the US was already developing their own crossover the Taurus X (it was called something else). The Falcon would have sat in a market featuring 3 variations of the Crown Vic and some lower end Jags, not that I would ever buy a X type over a Falcon. The Territory might have also cannibalised XC90/CX9 sales.

While the UAW might not liked to have seen imported Ford products I doubt Joe Blow consumer would have either. Where a car is made seems to have a big effect on the US market (both in positve and negative ways) and seeing the Holden's lack of sales success through that time it may have been the right choice.

[Ohio XB]

Originally Posted by Gobes32

Hi Ohio XB,

One of Australia's biggest beefs with the UAW especially within Ford Oz is the perception whether true or not, that the UAW block all our attempts to send Australian built cars overseas to the states. On many occasions it has been reported that the UAW have blocked attempts for Holden and Ford to send cars o'seas. If i remember correctly the Monaro (GTO) was only allowed to come over in very limited numbers after a lot of bending over by Holden and GM. When ford management in Australia are asked in information sessions why don't we send the Territory to the states the answer has been that the UAW would never allow it (because it makes the crap that Ford US churn out look like the garbage it is...........)

Australia has a vast union backed workforce so we are not a country of union haters, but some of the stories (lies?) we hear about the UAW down here makes us shake our heads in amazement.

Looking at the times of our posts I was writing another response while you posted this so I missed it at that time.

WOW!!! Very interesting information. I don't know how that got started but I am very very surprised. I will look into it and see what I can find.

My personal reaction is that the notion that the UAW is blocking imports from Australia is absolute crap. The UAW does not have this kind of power. If it did the Ford Fusion (US), Mercury Milan, Lincoln MKZ, and now the 2010 Fiesta would be built in the US instead of Mexico. The UAW cannot make these kinds of business decisions and I hope it is obvious that if they did the cars I mentioned would be built in the US instead of Mexico.

Talk with most UAW workers on the assembly line and they have no idea what products you even have down there. I am heavy into Australian Ford because I have an XA Fairmont that was done up like an XB Falcon before I got it. I would also say that about 85 - 90 of Ford workers don't even know that the Falcon is still being built. I cannot tell you how many times I have had to educate people on the Aussie Falcon.

As for the notion of blocking the Territory, though I am aware it is built on a different platform than the US Escape, it would be competing with the Escape in the same segment from within the same manufacturer. What I am saying is that we already have an equivalent vehicle as far as size, type of vehicle, target market, intended purpose, etc. I am aware of the quality and performance of the Territory and it has a great reputation. I am not going to get into comparing the two feature for feature as I don't know enough to go there, but I can say that the Escape enjoys a very good quality reputation and is selling very well. As of October Ford had sold 135,558 Escapes,plus the Mercury sister vehicle the Mariner, slightly upscale. Based on that there is a difficult argument to make to incur the costs and logistics of bringing the Territory over here, and there isn't even a left-hand drive version which would need to be engineered and built. I would suspect that this is the business situtation that Ford used in its decision not to bring the Territory here.

I don't know everything though and I will see if there is anything to substantiate what you mentioned. If I take too long drop me a PM to remind me.

Steve

[Ohio XB]

Originally Posted by Mark351

Not just sending cars into the US, but sending LHD configured exports into regions such as the Middle East already serviced by US exports, such as the amazingly hi-tech Crown Vic...

Now that Ford Oz is working on making the I-6 engine Euro compliant they will send Falcons to the middle east in the future?


We're still making the Crown vic??




: Just messin' with you.


I've written Derrick Kuzac several times and I put in my support for the LHD Falcon but I am a nobody. He always writes back to answer my questions, the ones he is at liberty to, but I don't think I have any weight with him on suggestions.


Steve

[Ohio XB]

Originally Posted by Luke Plaizier

I have to concur with all of this. In fact, in many parts of this country, the UAW is considered a dirty word because of the impact it has on restricting our export and profitability. It's no wonder that the slightest mention of the UAW in any US bailout failure has us all pointing our collective fingers at them for the blame. You have to understand the built-up angst they have caused to us over the years to appreciate how quickly we accept any token part in this as 'typical'.

It has forced the local branches into economies that are not seen elsewhere - or so we are told - such as the locals can still build quality cars on a business case of only tens of thousands of units sold in a year - not millions. New models can still be developed for AUD$1/2 Million (Territory) - those kinds of R&D dollars would not get very far anywhere else in the world.

And despite this there is still a perceived quality disparity between cars made in the US and elsewhere. The Mustang was exported to Australia and converted to RHD here in the early 00's, and were continuously lambasted for poor materials, fit and finish.

However, on their merits, I do see the points made here. I found it hard to accept the harsh words from some of the US senators towards the auto industry when all car makers worldwide are in a similar position. I had no appreciation of how little impact on the total cost of a car the UAW had. And I can see now how the boom periods in the past have helped to contribute to the bust we have now.

Think of it this way. If the auto makers get through this, they'll be all the stronger for it. In the immortal words of Kanye West "nya nya nya nya nut kill me, only makes me stronger...."


Lukeyson

Great post, and I really appreciate everyone being very civil. I don't get this on a lot of boards.


What you say about the UAW is pretty much the same you hear here. I would have to say that in the late 1990's, early 2000's there was quite a lambasting of the UAW among American citizens. Some based on things that were happening then and also on things that had happened looonnngg ago and created the perception of the UAW in such a negative light. Yeah, the UAW did nothing to cause anyone to think differently (a union guy admitting union faults? Get your cameras out) From that point on the UAW and the Big3 saw each other differently. Ron Gettlefinger has been praised by all the Big3, and not just in the manner of "sounding" good to put on a show for Gettlefinger for "niceties", but a genuine sense of understanding on both sides, company and union. This is felt through out the union.

This has given negotiations a very different tone. Each understands the other has a part to perform in the negotiations and that is respected. After that each side bargains towards something that meets both sides, for the most part, and the times and conditions are taken into account as well. This is why the contract was reopened in 2005 to make changes needed due to existing circumstances and the 2007 contract had so many consessions.....it is what's needed. Trying to get the media to report what UAW compensation is like now, and what consessions were already made, is nearly impossible.

Today I saw an interview with Alan Mulally and the reporter asked the question "So Ford will not need any money at this time?" This is two weeks after the Big3 were in front of the Feds and Mulally told them then, has reported this in news interviews ever since, has been written about in numerous newspaper articles, over and over, and the National media is STILL asking this question. I guess they didn't hear the answer the first time or the 27th time.


The 2000-ish Mustang you are referring to, your views are accurate. Now it is much much different across Ford's line-up. The person in charge of quality at Ford now is the person that built up Toyota's quality during the earlier 2000's. She came to Ford in October 2006 and has shaken things up just right.


Steve

[Ohio XB]

Originally Posted by b0son

Many have and many continue to do so. A postdoc position in the US or Europe is expected as valuable work experience prior to coming back here in search of an academic position.

I knocked back a job to work for a research lab in NY for $24k in 2002 (labs in the midwest offered 20-21k). Since then, the NIH offering mid-high $30's has forced the salary up (though not everyone is funded by the NIH, and some postdocs still get paid in the $20's), but its still significantly less than the average UAW worker.

Here in the US you can go to work for a NON-UNION machine shop as an apprentice, coming from a machining program at a vocational school while a high school student, and while still an apprentice you can be earning $20K - $28K USD. Finding people with the desire, the aptitude, the talent, and math skills for these jobs is thin.

There was a number of decades when factories and machine shops were not offering apprenticeships so when all the old-timers started retiring and dying there was no one to fill these jobs. Likewise, the market for employees to do this work is thin. Wages have always been good in this field and a bright, hard working apprentice is very appreciated and paid accordingly.

Now, with a non-union apprentice machinist/toolmaker/tool & die employee making more than a cancer researcher, is the UAW still the cause of imbalance? As a cancer researcher how does it feel to know my daughter, at 18 years old, is making more than you while she is in an apprenticeship and you've got a postdoc? It is a result of the field from which the companies can hire, some are large, some you have to look under every rock for someone to hire.

As for the work that the assemblers do on the line, I thought the same as most people do when I watched them the first time I hired in. The reason it looks so easy is because they have done it literally thousands and thousands of times. Repetitive work, if you've never done it, will eat you up. Here, where I work, the workers assemble about 450 vehicles a day.

This is another reason I have a slant against college. One can work in an apprenticeship and get paid to learn, and earn a good wage, or go to college and pay to learn and start out at the bottom of a financial hole. Also, the college grad may be in a market where they need SOMEONE to hire them so that they can get experience, and because of this the wage can be less than one would expect, certainly far less than I would expect.

Then again, I am a manual labor kind of person. I know others prefer jobs that require a degree and I admire that, I am only saying it is not for me, and since I am interested in manual labor anyways I see quite an advantage to my views.


So, I would say you were a victim of the employment market. A lot of IT people also get paid little because the market is flooded with those kinds of people. If someone doesn't take the job for little pay there are others behind them that will.



Steve

[Ohio XB]

Originally Posted by irlewy86

I always thought the real reason the Territory was blocked because the US was already developing their own crossover the Taurus X (it was called something else). The Falcon would have sat in a market featuring 3 variations of the Crown Vic and some lower end Jags, not that I would ever buy a X type over a Falcon. The Territory might have also cannibalised XC90/CX9 sales.

While the UAW might not liked to have seen imported Ford products I doubt Joe Blow consumer would have either. Where a car is made seems to have a big effect on the US market (both in positve and negative ways) and seeing the Holden's lack of sales success through that time it may have been the right choice.

How much would the Falcon sell for in the US if imported? The prices I see there, even with the exchange rate, are higher for the car without import costs than most Americans would be willing to pay for it.

Crown Vics are made for Police cars mostly. Very very few are made for regular consumers. They don't even produce them for retail unless it is ordered so it is not really a consideration as competition in the retail market. Most Americans don't even know it is still being built.


Ford sold Jag, and even while Ford had them they were never a volume industry for Ford. Jag is seen by Americans as something elite, rich people buy......or drug dealers. It is not something that most Americans consider for a daily driver.


Steve

[b0son]

Originally Posted by Ohio XB

Now, with a non-union apprentice machinist/toolmaker/tool & die employee making more than a cancer researcher, is the UAW still the cause of imbalance?

Partly, yes. Scientists dont have a union to speak of, and the types of people that becomes scientists are simply not the kind to be confrontational, make absurd demands etc.

Pay is not related to effort/skill required, its dependent on how much damage a collective of employees could do to their employer if they stopped work. Does this mean that their demands should continue to be entertained when their simply isnt the money to meet them?

If all process workers got paid what the UAW workers did, noone would manufacture anything. People used to laugh at the quality of Korean vehicles, that you got what you pay for. They've improved in leaps and bounds, without massive price increases. The chinese will be next. Then what for the US auto industry?

[Bossxr8]

Originally Posted by Ohio XB

Looking at the times of our posts I was writing another response while you posted this so I missed it at that time.

WOW!!! Very interesting information. I don't know how that got started but I am very very surprised. I will look into it and see what I can find.

My personal reaction is that the notion that the UAW is blocking imports from Australia is absolute crap. The UAW does not have this kind of power. If it did the Ford Fusion (US), Mercury Milan, Lincoln MKZ, and now the 2010 Fiesta would be built in the US instead of Mexico. The UAW cannot make these kinds of business decisions and I hope it is obvious that if they did the cars I mentioned would be built in the US instead of Mexico.

Talk with most UAW workers on the assembly line and they have no idea what products you even have down there. I am heavy into Australian Ford because I have an XA Fairmont that was done up like an XB Falcon before I got it. I would also say that about 85 - 90 of Ford workers don't even know that the Falcon is still being built. I cannot tell you how many times I have had to educate people on the Aussie Falcon.

As for the notion of blocking the Territory, though I am aware it is built on a different platform than the US Escape, it would be competing with the Escape in the same segment from within the same manufacturer. What I am saying is that we already have an equivalent vehicle as far as size, type of vehicle, target market, intended purpose, etc. I am aware of the quality and performance of the Territory and it has a great reputation. I am not going to get into comparing the two feature for feature as I don't know enough to go there, but I can say that the Escape enjoys a very good quality reputation and is selling very well. As of October Ford had sold 135,558 Escapes,plus the Mercury sister vehicle the Mariner, slightly upscale. Based on that there is a difficult argument to make to incur the costs and logistics of bringing the Territory over here, and there isn't even a left-hand drive version which would need to be engineered and built. I would suspect that this is the business situtation that Ford used in its decision not to bring the Territory here.

I don't know everything though and I will see if there is anything to substantiate what you mentioned. If I take too long drop me a PM to remind me.

Steve

We sell the Escape alongside the Territory here, its a smaller vehicle in a different class. The Territory was designed around the same time as the Ford Freestyle, which is now the Taurus X? I remember when the design of the Territory was revelled to Detroit HQ, within a few months the Freestyle suddenly started to look like it, they took some design ques and transferred them to the Freestyle and it ended up looking very similar.

The Freestyle was a bit of a flop wasn't it? Drove poorly, weak FWD 3 litre V6. Territory would have killed it in terms of dynamics, power, comfort and practicality. They should have built the Freestyle and Territory as one instead of wasting hundreds of millions of dollars on a vehicle that was inferior to a car Ford Australia created for a pittance, $500 million. Wouldn't be suprised if the Freestyle cost double that and was inferior. One Ford has been touted to remove this sort of doubling up of vehicles that serve a similar purpose and size. Problem is that anything in the future will probably be formed off the inferior US designed vehicle, instead of the superior australian versions. If the next all new Falcon is based on the Taurus they may as well just kill it now because it will be an absolute flop.

[Ohio XB]

Originally Posted by b0son

Partly, yes. Scientists dont have a union to speak of, and the types of people that becomes scientists are simply not the kind to be confrontational, make absurd demands etc.

Pay is not related to effort/skill required, its dependent on how much damage a collective of employees could do to their employer if they stopped work. Does this mean that their demands should continue to be entertained when their simply isnt the money to meet them?

If all process workers got paid what the UAW workers did, noone would manufacture anything. People used to laugh at the quality of Korean vehicles, that you got what you pay for. They've improved in leaps and bounds, without massive price increases. The chinese will be next. Then what for the US auto industry?

Pay is not related to effort/skill required....


Ok, so from this should I deduce that it is known by the scientists that they will not get paid what they are truely worth? Their pay will not be based on the sacrifice they made in order to become qualified, to gain the knowledge and skills to perform potentially life saving work?

I can understand the satisfaction of doing something so significant, but then based on what you stated this satisfaction will need to compensate for the lack of wages that will be paid. I admire anyone that is in this situation, but even though job satisfaction counts for a lot this situation would not be good for me. I prefer professions where the pay meets the level of skill/effort/sacrifice. After all, it is usually the reason for taking the job.


As far as "process workers", should they be paid what a UAW auto worker gets paid? If they perform a repetitive job, 350 to 450 times a day, work on their knees, maybe working with their arms above their heads, perform work that causes them to find themselves with carpal tunnel syndrome, or they need a knee replacement by the time they are 40, have trigger fingers that catch and snap, need to have their wife work their fingers in the morning while running them under warm water to get them to function before heading to work, might lose a finger when a piece of equipment suddenly fails, has their hand run into a steel frame when their air gun doesn't click off when it is supposed to at torque, get creamed by a forklift because they took their mind off their surroundings once in 18 years for .6 of a second, and more all the while conscientously building a world class quality product that leads its segment in the industry............

....hell YES, they should get paid what a UAW auto worker gets paid.


Ironically, it is what the Japanese pay their employees too......


UAW workers' pay on par with Japanese competitors in U.S.
http://www.toledoblade.com/apps/pbcs...SS02/812130362

ARTICLE HIGHLIGHTS

The numbers, however, paint a picture of UAW wages already in line with Japanese competitors building cars in the United States.


"There's a lot of myths out there," said Ed Miller, a spokesman for Honda, which has plants in six states, including Ohio.

"There's some assumptions about our pay and benefits that are just that - they are assumptions," he said.


But based strictly on wages, the $28 an hour paid by Ford, Chrysler, and GM fall in line with their counterparts. Toyota says it pays about $30 an hour, while Honda pays $28.87, and Nissan pays an hourly rate of about $25 an hour.


The $28.87 Honda workers earn includes the base wage of $24.80, plus an attendance bonus of $1.25 for each hour worked, a bonus-sharing program that adds $2.32 per hour, and an earnings payment of 50 cents per hour. Also, Honda workers are offered a competitive health care plan.




So please don't buy into the "historical" complaint that UAW workers are making far more money than all the other companies. If anyone thinks this article is a sly attempt at fogging what everyone "knows" to be right I can provide more links.


Steve

[Ohio XB]

Originally Posted by Bossxr8

We sell the Escape alongside the Territory here, its a smaller vehicle in a different class. The Territory was designed around the same time as the Ford Freestyle, which is now the Taurus X? I remember when the design of the Territory was revelled to Detroit HQ, within a few months the Freestyle suddenly started to look like it, they took some design ques and transferred them to the Freestyle and it ended up looking very similar.

The Freestyle was a bit of a flop wasn't it? Drove poorly, weak FWD 3 litre V6. Territory would have killed it in terms of dynamics, power, comfort and practicality. They should have built the Freestyle and Territory as one instead of wasting hundreds of millions of dollars on a vehicle that was inferior to a car Ford Australia created for a pittance, $500 million. Wouldn't be suprised if the Freestyle cost double that and was inferior. One Ford has been touted to remove this sort of doubling up of vehicles that serve a similar purpose and size. Problem is that anything in the future will probably be formed off the inferior US designed vehicle, instead of the superior australian versions. If the next all new Falcon is based on the Taurus they may as well just kill it now because it will be an absolute flop.

Thanks for the catch-up on the Territory. I was thinking the 2004 Territory resembles an Escape more than a Freestyle. Looking at some pics now I see what you mean. I thought the Territory was taller than it is.

I agree, the Territory is superior to the Freestyle, and it is being dropped.

The next gen US Fusion and global Mondeo will be designed together. I do not know if the Volvo based Mondeo platform will be used or the Mazda6 based platform of the Fusion. In this case, luckily, both platforms are excellent.

The US Focus is going away to be replaced by the European Focus.


I believe that Ford is going to make the right call on eliminating the lesser of the designs and keeping the superior ones. I've heard rumors of the Falcon platform being THE platform for global fullsized cars.


Steve

[b0son]

Originally Posted by Ohio XB

So please don't buy into the "historical" complaint that UAW workers are making far more money than all the other companies.

You seem to be intent on missing the point (again). So what if other companies can pay those wages? Those companies arent on the brink of bankruptcy. If an American auto company is going bust, why shouldnt wages (which are well above the norm for process work) remain untouched?

Whats better from a social point of view? Keep all 1000 workers on at $25ph, or sack 167 employees and keep the remainder at $30ph?

[b0son]

Originally Posted by Ohio XB

I've heard rumors of the Falcon platform being THE platform for global fullsized cars.

Both Commodore and Falcon were touted as the platform for both their company's large cars. It's never happened, even if those cars were superior to GM's and Ford's US offering at the time.

[vztrt]

Originally Posted by b0son

Both Commodore and Falcon were touted as the platform for both their company's large cars. It's never happened, even if those cars were superior to GM's and Ford's US offering at the time.

The VE or Zeta platform was a worldwide platform. But it was dropped earlier this year.

[Ohio XB]

Originally Posted by b0son

You seem to be intent on missing the point (again). So what if other companies can pay those wages? Those companies arent on the brink of bankruptcy. If an American auto company is going bust, why shouldnt wages (which are well above the norm for process work) remain untouched?

Whats better from a social point of view? Keep all 1000 workers on at $25ph, or sack 167 employees and keep the remainder at $30ph?

I think I've got it now.

Right now labor costs on average between the Big3 account for only 10% of the price of the car. Ford is doing better than that at about 6 - 7%. I find most people are not aware of this and even more do not want to believe it. The 10% figure was stated by the Pres. of the UAW in front of 2 government panels and the press. The 6 - 7% was stated to me by the company while building the Mercury Villager and Ford Escape.

In the plant I work in we were building the Ford Escape in 2004. I was informed by the company (Engineer in charge of quality of the build) that there was $1,300 of Ford labor (total cost, wage plus benefits) in the vehicle. This is in a vehicle that sells for, at the time, $17,500 - $20,000 USD.

Lets cut the employees total compensation in half. Now it only costs $650 in labor to build that vehicle. Lets say that the labor cost in the vehicle goes from 6.5% down to 3.25%.

Is this 3.25% reduction in the cost of the vehicle going to propel the company into a vastly better overhead cost position?

If a 3.25% cost savings is all that is needed is it at all possible that it could be found in the other 93 - 94% of the cost of the vehicle? Why are all the company's financial woes blamed on the same 6.5% of costs?



Before gas shot up and before the economy took a dive this year the UAW had already taken steps to remove over $ 1/2 billion in direct operating costs from Ford in concessions and work rules. Ford's operating costs have been reduced by $5 billion compared to 2005 as a result of these actions and others taken by the company. Since gas shot up, the economy tanked, and sales slowed to a crawl the UAW has been talking with the Big3 to make even more consessions to reduce labor costs.

So I mention all that to demonstrate what impact a $24 total compensation cut would make to the price of the car and profit, going past a 50% hourly wage cut even. Manufacturing efficiency is the best it has been at Ford and continues to get even better. GM has even better efficiency, topping even Toyota. It takes less people than ever before.


Now there I am sure you will want to say "Yes, and those fewer people should not be over paid so much, or should take a pay cut to help the company."


A lot of Americans say that as well.


Starting wage is a 50% wage cut now. Anyone that hires in will be paid $14 per hour, also with reduced benefits. To get these people in at these wages the present employees were offered buy-outs to leave the company. New employees have been hired under this new agreement. When the economy recovers and production needs to increase even more will be hired under this wage and benefit scale. This has been agreed to, is in place, and is happening.

What about the rest?


I've been at Ford for over 16 years. Many have been there 20 or more. Wage increases were agreed to by Ford in exchange for other bargaining chips that Ford wanted in the regular bargaining sessions at contract time. These employees have bought homes, cars, put kids in college, and based their lifestyle on this income all these years.

Now slice them in half.

Where does the house payment come from?
Where does the car payment come from?
Where does the college tuition come from?
Where does property tax payment come from?


When people speak about taking a direct wage cut like that little is considered about knocking someone down from upper middle class to lower middle class, or based on family size, just above poverty. It's quite a lifestyle change. Aww, poor auto workers some may say.


I would like to see a lot of people live on half of their pay for years, yet alone a month.

So now if the companies were to slice the hourly wage in half it would throw the workers into financial peril and it would not impact the company in any signifcantly positive way.


In the meantime, that other 93.5% might have a little fat in it yet.




It is not so cut and dried as the media skews it. Politicians and the media keep perpetuating the thought that if we could just cut the workers wage a car would only cost 75% of what it does now to make!

That fact could not be farther from the truth.

What you call "process workers"; I don't know if you have ever worked on an automotive assembly line, but the work is debilitating. It is not easy to find a retired worker that doesn't have some kind of physical or medical condition as a result of their time on the line. Many have joints that don't work anymore, backs that are useless, have had joints replaced, and on and on. Quality of life is reduced as a result. Many also die within 2 years of retiring.

This can be equated to why coal miners are paid well, even though they don't have years of college. It's like hazzard pay on top of pay for the labor.



I hope this addresses your concern and that I have enough of a grasp of it now. I also hope that you will understand the answer, like it or not.


Steve

[Ohio XB]

Originally Posted by b0son

Both Commodore and Falcon were touted as the platform for both their company's large cars. It's never happened, even if those cars were superior to GM's and Ford's US offering at the time.

Well, like I've said, all I've got right now are rumors.

Incidently, the Taurus platform is a very good platform but the body style is really lame. I mentioned this to one of the company heads long before it was introduced. When it was coming out as the Five Hundred it had very 1996 body styling, and this was 2005.

When it was changed to the Taurus after Mulally came to Ford it had over 500 improvements done to it, but the styling still snuffed its sales.

The platform was based off a Volvo (actually off the Lincoln LS which was based on a Volvo), and since the Mondeo was also based off a Volvo platform, and it is heralded around the world, I would think the Taurus platform is pretty good as well; ride, handling, safety, etc. It certainly get accolades in these areas.

When I show the Falcon to people here though they would love to see that car here. Is the platform better than the Taurus? Very likely could be, I just don't want to see the Taurus called "junk" because it is way beyond that.


Steve

[Gobes32]

One thing Ford America could improve (or maybe already has ) is your initial model start up costs. As you may be aware, our Territory started as a drawing to a car rolling off the line for 500 million, you mentioned that the budget for a US car would be a lot more than that. The Territory can be ordered as a economy people mover with RWD and goes all the way through to a luxury AWD with a 4.0 ltr Turbo Inline 6 that has had comparable reviews with the BMW X5 (V8). We are very proud of the Territory in Australia and find most people who buy one instantly find something about the car they adore.

Alan Mulally recently came to Australia just after the launch of our latest Falcon, where he was taken for a drive in a G6E Turbo (google if you like) which is a luxury sedan with a 270kw turbo 6 that costs a fraction more than the average yearly Australian wage. To say he was blown away is an under statement. We feel that in Australia we produce excellent (and fast) cars that can compete on a world stage but instead we are suffocating while we rely on local sales. Hopefully Mr Mulally will finally let us compete world wide (RHD) and thrive as a manufacturer of tough, well designed and built Ford cars. My fingers remain crossed.

[b0son]

Originally Posted by Ohio XB

Anyone that hires in will be paid $14 per hour, also with reduced benefits.

IOW, a sustainable wage/benefit scheme - what EVERYONE should have always been operating on. The big question is, if these companies survive, will the UAW again start making demands that see employee wages/benefits head back towards their past levels?

These employees have bought homes, cars, put kids in college, and based their lifestyle on this income all these years.

Now slice them in half.

Where does the house payment come from?
Where does the car payment come from?
Where does the college tuition come from?
Where does property tax payment come from?

In all those years, they didnt pay off their house, they didnt save anything? Sorry, but that level of financial irresponsibility shouldnt be rewarded. I've never planned my finances on the basis that I could never lose my job are have to take a substantial paycut.

When people speak about taking a direct wage cut like that little is considered about knocking someone down from upper middle class to lower middle class, or based on family size, just above poverty. It's quite a lifestyle change.

And having no job at all, is better?

So now if the companies were to slice the hourly wage in half it would throw the workers into financial peril and it would not impact the company in any signifcantly positive way.

What sort of financial peril is likely to result if they have no job, no income?

What you call "process workers"; I don't know if you have ever worked on an automotive assembly line, but the work is debilitating.

Perhaps the UAW should have pushed for better conditions. Our auto plants arent anywhere near medieval in nature here in Australia (from the way you make yours sound).....

I hope this addresses your concern and that I have enough of a grasp of it now. I also hope that you will understand the answer, like it or not.

Yep, preserve the status quo at all costs. At least you work for Ford, you have a fair bit more time up your sleeve.

[Ohio XB]

Originally Posted by Gobes32

One thing Ford America could improve (or maybe already has ) is your initial model start up costs. As you may be aware, our Territory started as a drawing to a car rolling off the line for 500 million, you mentioned that the budget for a US car would be a lot more than that. The Territory can be ordered as a economy people mover with RWD and goes all the way through to a luxury AWD with a 4.0 ltr Turbo Inline 6 that has had comparable reviews with the BMW X5 (V8). We are very proud of the Territory in Australia and find most people who buy one instantly find something about the car they adore.

Alan Mulally recently came to Australia just after the launch of our latest Falcon, where he was taken for a drive in a G6E Turbo (google if you like) which is a luxury sedan with a 270kw turbo 6 that costs a fraction more than the average yearly Australian wage. To say he was blown away is an under statement. We feel that in Australia we produce excellent (and fast) cars that can compete on a world stage but instead we are suffocating while we rely on local sales. Hopefully Mr Mulally will finally let us compete world wide (RHD) and thrive as a manufacturer of tough, well designed and built Ford cars. My fingers remain crossed.

I hope so too. Your inline 6, especially with turbo, is an engine I just love, and I have never even driven one. I've seen the power figures, acceleration times, and how people customize the engine. I WISH we could get it here.

Detroit has removed 18 months from new product development time with Virtual Manufacturing software. I am sure it is still cheaper in Australia to create a new model.



Steve

[vztrt]

Originally Posted by Ohio XB

I think I've got it now.

Right now labor costs on average between the Big3 account for only 10% of the price of the car. Ford is doing better than that at about 6 - 7%. I find most people are not aware of this and even more do not want to believe it. The 10% figure was stated by the Pres. of the UAW in front of 2 government panels and the press. The 6 - 7% was stated to me by the company while building the Mercury Villager and Ford Escape.

That is one thing people don't believe about the cars. Most of the cost is the R&D and tooling in a car where the cost come from. Thing is the first area to be cut in a crisis is the manufacturing area.

[Ohio XB]

IOW, a sustainable wage/benefit scheme - what EVERYONE should have always been operating on. The big question is, if these companies survive, will the UAW again start making demands that see employee wages/benefits head back towards their past levels?

Not likely. It is a very different world we live in. Only if the companies become successful beyond their best times can I imagine the UAW asking for an accelerated wage increase. The idea is if the company is making boat loads of money there is no reason some of that can't filter down to those that made it possible. But it will never be like it was.

In all those years, they didnt pay off their house, they didnt save anything? Sorry, but that level of financial irresponsibility shouldnt be rewarded. I've never planned my finances on the basis that I could never lose my job are have to take a substantial paycut.

Home loans in the US are typically for a 30 year term. If you've been at Ford for 15 - 20 years, no, your home is not paid off yet.

If you've got a good wage are you going to buy a home in a slum that is run down? No. You are going to buy a home in a decent community, and maybe you want a nice yard for the kids to play in and a place to throw horsehoes. If you have a good wage you at least want something "nice". They are not living beyond their means, they are living a lifestyle that matches what their income allows them to, while saving money as well, and putting the kids through college.

And having no job at all, is better?

As many times as I have attemped to make it clear, do you not understand the lack of impact of cutting the hourly wage in half? I've outlined it several times in this thread and others.

Labor at Ford is about 6% of the cost of the car. If you eliminate labor all together, 100% free labor, it will only reduce the cost of the car by 6%. Is 6% making or breaking Ford? Is there some savings in the other 94% of the cost of the vehicle?

How is cutting 6% of the cost of the car in half going to make Ford a financial dynamo?????!!!!! Do a little math please. I am done stressing this point. If you still disagree with me on it then please outline how cutting this 6% of the cost of the car in half will make Ford financially stable.

Incase you have done no research, Ford is good on money and does not want any from the government at this time. Also, the Union continues to meet with Ford and make more concessions.....right now.......ongoing......

Perhaps the UAW should have pushed for better conditions. Our auto plants arent anywhere near medieval in nature here in Australia (from the way you make yours sound).....

There are excellent ergonomics programs. However, some injuries you cannot even tell are developing over time and by the time you realize it you need treatment in one form or another.

It is the nature of the beast. Your body was constructed to move so many times in your lifetime. You use up these movements on an assembly line by the sheer repetitiveness of the work. You constantly move on the line, finishing one vehicle, picking up your parts that you install as you walk back towards the next vehicle entering your work area, and you keep going until break time.

I hope an Aussie Ford worker or two can chime in. I am sure that they will not be able to say they are immune from repetitive work injuries.

Yep, preserve the status quo at all costs. At least you work for Ford, you have a fair bit more time up your sleeve.

Once again you demonstrate the same mentality of our government, not knowing A THING about what has been going on over the last 5 years between the Big3 and the union.



Copied from another one of my posts in another thread. These are from the outline of the Ford Way Forward Plan from 2006....


Ford continues to work with the UAW to improve the competitiveness of its U.S. manufacturing facilities. As a result, new competitive operating agreements have been ratified by UAW locals in 30 different U.S. Ford and ACH facilities – and nearly $600 million in annual savings is projected to be realized.

Today - DONE


Compared with 2005, annual operating costs will be reduced by about $5 billion by the end of 2008.

Today - DONE


An agreement with the UAW will expand early retirement offers and separation packages to all Ford U.S. hourly employees, including Ford employees at the company’s ACH plants. Employees will begin receiving details by mid-October, and those accepting offers will leave the company by September 2007.

Today - DONE


Ford will accelerate by four years its previously announced goal of reducing 25,000 to 30,000 North American manufacturing employees by the end of 2012. The reductions now will be completed by the end of 2008.

Today - DONE, only total hourly employees reduced is more than 40,000.


Read about all the changes here.......if you don't then you just don't want to know the truth, as you have demonstrated so far.

http://media.ford.com/article_displa...ticle_id=24261






Steve

[Ohio XB]

Originally Posted by vztrt

That is one thing people don't believe about the cars. Most of the cost is the R&D and tooling in a car where the cost come from. Thing is the first area to be cut in a crisis is the manufacturing area.

Exactly.


I have a theory that one reason that they go after labor first is because the only change that happens is that someone (the worker) changes their mind how much it will cost to do something. There is no impact other than the workers saying "ok" to a wage reduction.

Anytime there is a cut anywhere else that task has to be done differently to make up for the money being saved. It is work and effort to make it happen. It is harder than someone just saying "ok".


If a part is going to be made cheaper someone has to figure out if they will use a lower quality, cheaper material, make it in a lower wage country, or some other method to make a savings.

If shipping costs are going to be reduced someone has to figure out how to save fuel. Do you buy new trucks? Do you make vehicles smaller so you can get more in a train car?

It takes effort.

But if you can get a worker to say "Yeah, pay me less", that is all there is to it. Funny thing is that amount is too small to make a difference now.







Steve

[Gobes32]

I am going to give a very quick lesson in R&D costs so be prepared to be shocked.......

These are all rough figures.....

Left Hand Fender

Draw Die 250k - Total cost inc design, materials, labour etc

Transfer Dies x 4 at 100k each as above

Fingers and gauges $? But maybe 3 months of wages to sort them out and error proofing

And that's just one panel of many...............

[Bossxr8]

Originally Posted by Ohio XB

There are excellent ergonomics programs. However, some injuries you cannot even tell are developing over time and by the time you realize it you need treatment in one form or another.

It is the nature of the beast. Your body was constructed to move so many times in your lifetime. You use up these movements on an assembly line by the sheer repetitiveness of the work. You constantly move on the line, finishing one vehicle, picking up your parts that you install as you walk back towards the next vehicle entering your work area, and you keep going until break time.

I hope an Aussie Ford worker or two can chime in. I am sure that they will not be able to say they are immune from repetitive work injuries.








Steve

I can back you up on this. I've done 9 years and my wrist sounds like a cement mixer.

[Gobes32]

I wouldn't need such high wages if houses hadn't tripled in value when I turned 18. I will quite happily take home 400 a week if the median house price drops to 100k

[vztrt]

Here's a story on the UAW, and might help explain why they have such a bad name in the states.

http://www.theage.com.au/opinion/uni...1221-72y4.html

Originally Posted by theage

United, they built a nation
Harold Meyerson
December 22, 2008

IN 1949, a pamphlet was published that argued that the American auto industry should pursue a different direction. Titled A Small Car Named Desire, the pamphlet suggested that Detroit not put all its bets on bigness, that a substantial share of American consumers would welcome smaller cars that cost less and burned fuel more efficiently.

The pamphlet's author was the research department of the United Auto Workers.

By the standards of the postwar UAW, there was nothing exceptional about A Small Car Named Desire. In its glory days, under the leadership of Walter Reuther, the UAW was the most far-sighted institution — not just the most far-sighted union — in America. "We are the architects of America's future," Reuther told the delegates at the union's 1947 convention, where his supporters won control of what was already the nation's leading union.

Even before he became UAW president, Reuther and a team of brilliant lieutenants would drive the Big Three's top executives crazy by producing a steady stream of proposals for management.

In the immediate aftermath of Pearl Harbour, Reuther, then head of the union's General Motors division, came up with a detailed plan for converting auto plants to defence factories more quickly than the industry's leaders did. At the end of the war, he led a strike at GM with a set of demands that included putting union and public representatives on GM's board.

That proved to be a bridge too far. Instead, by the early 1950s, the UAW had secured a number of contractual innovations — annual cost-of-living adjustments, for instance — that set a pattern for the rest of American industry and created the broadly shared prosperity enjoyed by the nation in the 30 years after World War II.

The architects did not stop there. During the Reuther years, the UAW also used its resources to incubate every up-and-coming liberal movement in America. It was the UAW that funded the great 1963 March on Washington and provided the first serious financial backing for Cesar Chavez's fledgling farm workers union. The union took a lively interest in the birth of a student movement in the early '60s, providing its conference centre in Port Huron, Michigan, to a group called Students for a Democratic Society when the group wanted to draft and debate its manifesto.

Later that decade, the union provided resources to help the National Organisation for Women get off the ground and helped fund the first Earth Day. And for decades after Reuther's death in a 1970 plane crash, the UAW was among the foremost advocates of national health care — a policy that, had it been enacted, would have saved the Big Three tens of billions of dollars in health insurance expenses, but which the Big Three themselves were until recently too ideologically hidebound to support.

Narrow? Parochial? The UAW not only built the American middle-class but helped engender every movement at the centre of American liberalism today — which is one reason that conservatives have always held the union in particular disdain.

In the past several weeks, it has become clear that the Republican right hates the UAW so much that it would prefer to plunge the nation into a depression rather than craft a bridge loan that doesn't single out the auto industry's unionised workers for punishment. (As manufacturing consultant Michael Wessel pointed out, no Republican demanded that Big Three executives have their pay permanently reduced to the relatively spartan levels of Japanese auto executives' pay.) Today, setting the terms of that loan has become the final task of the Bush presidency, which puts the auto workers in the unenviable position of depending, if not on the kindness of strangers, then on the impartiality of the most partisan president of modern times.

Republicans complain that labour costs at the Big Three are out of line with those at the non-union transplant factories in the South, factories that Southern governors have subsidised with billions of taxpayer dollars. But the UAW has already agreed to concessions bringing its members' wages to near-Southern levels, and labour costs already comprise less than 10 per cent of the cost of a new car. (On Wall Street, employee compensation at the seven largest financial firms in 2007 constituted 60 per cent of the firms' expenses, yet reducing overall employee compensation wasn't an issue in the financial bail-out.)

In a narrow sense, what the Republicans are proposing would gut the benefits of roughly a million retirees. In a broad sense, they want to destroy the institution that did more than any other to raise American living standards, and they want to do it by using the power of government to lower American living standards — in the middle of the most severe recession since the 1930s. The auto workers deserve better, and so does the nation they did so much to build.

WASHINGTON POST

[Ohio XB]

Originally Posted by Bossxr8

I can back you up on this. I've done 9 years and my wrist sounds like a cement mixer.

Thank you. I had no fear in making that statement that an auto worker would come in and say "I've worked the line for 12 years and I am great!"

So do you have draconian work conditions there???

What has been done or needs to be done for your wrist, if I may ask? Good luck with it.


Steve

[Ohio XB]

Originally Posted by Gobes32

I am going to give a very quick lesson in R&D costs so be prepared to be shocked.......

These are all rough figures.....

Left Hand Fender

Draw Die 250k - Total cost inc design, materials, labour etc

Transfer Dies x 4 at 100k each as above

Fingers and gauges $? But maybe 3 months of wages to sort them out and error proofing

And that's just one panel of many...............

Thanks for those numbers.


Something that usually is a part of a new process. An Engineer told me this one. Being a Toolmaker I was involved in the discussions of a new fixture to accomplish a certain task on the assembly line. The engineers (Mechanical engineers, Industrial Engineers) and Toolmakers were all in agreement that the design would work great. Then the lead engineer said "Ok, then let's make it and find out why it doesn't work".

The point of that is that many things will work great in theory and on paper, but when applied in the real world you learn something that you couldn't have known before. Now there is more work and cost in making the idea work.


Steve

[Ohio XB]

Originally Posted by vztrt

Here's a story on the UAW, and might help explain why they have such a bad name in the states.

http://www.theage.com.au/opinion/uni...1221-72y4.html

Thanks for posting that. It really helps when this stuff is pointed out by more than one person.

Here's a quote from an article in the NY times.....


"We have a strong relationship with the U.A.W.,” said Mark Truby, the Ford spokesman. “We’re going to continue to work to completely close the competitive gap with foreign transplants.”



Does this sound like a Ford person that is dreading inflexibility in the UAW to reduce costs? Does this sound pessemistic that the UAW does not get it and that they will drag Ford into bankruptcy because of their old hardline union ways? No. This is expected on the union side as well.


Steve