Last week GM announced yet another round of buyouts due to a reported $38.7 billion loss.Greed has put American automakers in a compromising position. You can point to disloyal Americans buying foreign cars, but it boils down to the very foundation of this country.
Competition is good for the economy and the consumer. America is country that prides itself in a "free market". Consequently, you cannot wish away foreign companies simply because it may force Americans out of a job. There is only one thing we can do...compete.
Many blue-collar workers were pulling in $58 thousand per year. While providing this generous income, GM created a product that foreign car companies have all but eclipsed in quality and safety. Had they been able to compensate their employees based on work quality, as non-union companies do, they could've paid their workers a reasonable wage and put the remaining funds into building a more competitive product.
There is plenty of blame to go around for the decline of General Motors, but the UAW could've gone a long way to help the situation and the future of the company. Instead of holding out a hand and demanding more and more money, the UAW should have realized that the money tree would eventually die if no one watered it.
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American auto companies and the UAW are both in a state of denial. And that’s not good for the residents of Michigan. If you don’t believe that just ask anyone (still) trying to survive in Flint.
While the imports - and especially companies like Toyota - were busy working on increased fuel efficiency and "true" hybrids the leaders of the Big Three saw increasing fuel prices as a temporary aberration.
GM’s CEO was quoted just two years ago as believing that $2.00-plus gas was temporary and we’d be back under that threshold by the end of the year. As a result, they continued to build oversized SUVs so soccer moms could go grocery shopping by themselves while trying to drive with a cell phone in their ear. Meanwhile, their spouses raced each other to work, gunning it from traffic light to traffic light. And now GM has a supposedly hybrid Malibu that gets about two mpg better than the base model.
Don’t get me started on traffic light timing. You can’t drive anywhere without having to stop at nearly every intersection – unless, of course, you drive 10 mph over the speed limit. If the Big Three spent a tenth as much money lobbying to insist on better timing of traffic lights instead of fighting forced fuel economy levels they might not be in the position they are now of having to hit higher those fuel efficiency levels.
Now for the UAW, those $60,000/year employees that have no skills beyond what they’ve been taught on an assembly line. They don’t care about buying American, they just care about their own jobs. After all, more and more American cars are now produced in foreign countries.
I just heard that the Ford Fusion, Mercury Milan and Lincoln MKZ are all assembled in Mexico. Meanwhile my “foreign” Toyota Camry hybrid (that’s consistently getting the advertised 34 mpg, 11-12 mpg more than the base Camry) was built in Kentucky. Even better, 20% of the parts came from Detroit. I
If the UAW members want to protect their jobs they’d better make nice with the foreign manufacturers that would like to build in Detroit but don’t have the patience to adjust their proven processes to allow for all the UAW member’s sick days and extra minutes needed to perform tasks others do much faster.
Until both the UAW and the Big Three drop their stance of denial we’re in for a slow death spiral. And the rest of Michigan will look a lot like Flint.
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