The applied labor rates for the big three US auto manufactures were almost double the rates for the non-union shops. Besides higher initial wages, there were much earlier retirement benefits, higher cost fringe benefits, union fees, lesser plant efficiencies due to "featherbedding", etc.

The actual automobiles coming off the line were of lesser quality for several reasons, not the least of which were outdated manufacturing processes dictated b the union contracts. The use of robotics for repeated processes results in higher duplication accuracy, thus quality in fit and finish. This was fought tooth and nail by the unions, because the machines would replace skilled workers. Yet the process was used by every manufacturer not under contract with the UAW.

The management of the big three screwed up big time, they allowed themselves to become hostages of the unions, what ever contract was gotten from one, the others were forced to follow.

The scenario of the auto industry has been played out in many industries, steel, electronics, garments, etc. all were sent overseas because of lower manufacturing costs and lower taxes.

Keep up the Utopian dreams, if we keep going the way we are, they will soon be all we have.

 

Bullshit, nothing.

It is not just the workers, in fact there is nothing wrong with American workers.

It is the idiotic game that was played by both management and labor, the higher cost of producing a car in a union shop in the US is not disputable. Try to show me how a company, any company, can compete with a manufacturer of similar products when the labor factor is double. And that is on our soil, all while using American labor.

Explain how that works.

 

I can't blame factory workers for trying to get as much as they can in a country without Europe's safety net.

What about management compensation? Do you think it is justified for business executives in General Motors to earn much more than their counterparts in Europe and Japan? What about the fact that Detroit kept building gas guzzlers when the Europeans and Japanese designed fuel efficient models?

 

I remember reading that the total compensation ended up being about 1/3 less at the Toyota plant, but it was also located in some rural area in the middle of nowhere.

 

Toyota has facilities in many major US cities, they have invested $17 billion and employ over 37,000 US workers, they purchase over $29 billion per year from US suppliers.

The wage package for Toyota averages $48/hour while the GM US average wage package is $73/hour. However the labor cost applied to each vehicle is double at GM, due to the more efficient manufacturing processes of Toyota.

 

Oh I see what you're saying.

I'd blame it on decades of US coddling. They didn't think they had to really innovate and change. Toyota, meanwhile, was smart and opened up factories in the US to get around the import quotas meant to protect the US automakers.

 

Factcheck.org

The automakers arrived at the $70+ figure by adding up all the costs associated with providing wages and benefits to current and retired workers and dividing the total by the number of hours worked by current employees...

In 2006, at Toyota's Georgetown, Ky., plant, workers averaged more in base pay and bonuses than UAW members at Ford, General Motors and Daimler Chrysler, according to the Detroit Free Press. The difference was due to profit-sharing bonuses...

A final note on all this: Labor costs only account for about 10 percent of the cost of producing a vehicle. And it's not the cost of American cars that people complain about; they're already often thousands of dollars less than their Japanese counterparts. Whatever changes may be made in the carmakers' labor agreements, we're convinced, and the recent hearings show, that there are much bigger problems in Detroit.

http://www.factcheck.org/askfactcheck/do_auto_workers_really_make_more_than.html

 

That is what you should've pointed out. That's a very shifty way of doing things.

 

That has never been denied, the cost of labor for building an automobile includes the benefits paid to past and present workers. That is a legitimate cost of labor. Where else would you put those costs?

The true numbers for pre-bankruptcy GM direct labor cost without benefits versus same period Toyota was $29.84/hour vs $24.00/hour. Benefits add to the GM number $36.00/hour for active employees, while Toyota pays $24.00/hour in benefits. GM also has to pay the retirement benefits and healthcare costs of 432,000 retirees and their spouses.

If you add the hourly wages, direct active benefits and retiree benefits, the cost per vehicle is over $1,500 higher for GM over Toyota.

 

Costs yes. But you don't determine how much an average employee makes per hour by including retired persons. Retired persons work zero hours and it will skew the results. Even if toyotas figures were determined the same way it is safe to assume they have fewer retirees. I'd still like to know if otcwas calculated the same though.

 

Also, "Labor costs only account for about 10 percent of the cost of producing a vehicle." Blaming the UAW for Detroit's problems is right wing scapegoating. Detroit's problems were caused by specializing in SUVs while European and Japanese companies turned out fuel efficient models. In addition, for a long time foreign cars were better designed, but American models seem to be catching up.

 

Direct labor yes, it is about 10% for US manfacturers and about 7 1/2 % Japanese, US built cars. However, the cost per vehicle including all labor related costs is closer to 20% for pre-bankruptcy GM and less than 14% for Toyota US built cars. The quality of US cars in the 70's and 80's was not significantly worse than the US built Japanese cars, but the difference really took became more obvious in the 90's, when the innovations that the Japanese introduced were not duplicated by GM, mainly due to union contracts. The US manufacturers are solely to blame for misjudging the market for smaller, more economical cars. However, the Japanese missed the popular truck business until they introduced larger pick ups to compete with the F-150's and the C-10's, the US manufacturers still own that segment of the market.

When the market for new cars went to hell, Toyota could idle a plant with very little impact on costs, GM had to pay 95% of the wages and all of the benefits. It amounted to over $1,500 per car NOT built.

 

I still like the 10% figure. What is certain is that American cars are not more expensive than foreign cars, even when they are made in the United States. U.S. factory workers cannot be blamed for trying to get as much as they can for themselves in a country where grabbing as much as you can for yourself is the leading principle. Those who earn most of the blame for the fall of Detroit earn quite a bit more than $70 an hour.

 

Believe what ever you would like to believe, I do not reside in the never, never land of my imagination.

 

Says you.

 

The bolded part is where I disagree, the underlined is my opinion

 

Yep, you're catching on, that what I said.

 

Great. You have to know what to believe and what not to believe. Now all you need to do is to figure out the difference.

 

I believe it's quite inaccurate to blame unions for everything.