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Thread: Unions Kill G.M.

  1. #46
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    Sold - 500 shares of Ford.
    I'll let it lag to $5, then maybe reinvest.

  2. #47
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    Attached is a column by Rick Wagoner that appeared in today's Wall Street Journal. He shares his insight on the struggles that GM and the U.S. auto industry are going through and what we're doing at GM to address these issues. I think you'll find it to be interesting reading.
    Mark LaNeve

    Vice President

    GM North American Vehicle Sales, Service and Marketing

    Since mid October, General Motors has announced plans to cease production at 12 North American manufacturing facilities and eliminate 30,000 jobs by 2008, trim 1 billion in net material costs in 2006, and, in cooperation with the United Automobile Workers, reduce GMs retiree health care liabilities by 15 billion, or about 25 percent, for an annualized expense reduction of 3 billion.

    The reason for these dramatic actions is no secret. GM has lost a lot of money in 2005, due to rapidly increasing health care and raw material costs, lower sales volumes and a weaker sales mix essentially, we have sold fewer high profit SUVs and more lower profit cars. What is less clear is why things turned sour so fast for GM, as well as for other American auto makers and suppliers. To put it another way, why are so many foreign auto makers and suppliers doing well in the United States, while so many U.S. based auto companies are not?

    Despite public perception, the answer is not that foreign auto makers are more productive or offer better-quality or more fuel-efficient vehicles. In this years Harbour Report, which measures manufacturing productivity, GM plants took three of the top five spots in North America, including first place.

    In the latest J.D. Power Initial Quality Study, GMs Buick and Cadillac ranked among the top five vehicle brands sold in America, ahead of nameplates like Toyota, Honda, Acura, Nissan, Infiniti and Mercedes-Benz. And GM offers more models that get over 30 miles per gallon, highway, than any other auto maker.

    In fact, this kind of operating performance makes GMs recent financial performance all the more frustrating. The fact is, we are building the best cars and trucks we have ever built at GM, our products are receiving excellent reviews, and we are running the business in a globally competitive manner. Outside of North America, we are setting sales records. In fact, for the first time in our history, we will sell more cars and trucks this year outside the United States than inside, aided in no small part by our market leading performance in China.

    So why, fundamentally, are GM and the U.S. auto industry struggling right now?

    Intense competition for one. The global auto business grows tougher every year, and we accept that. Our ability to compete has made us the world's No. 1 auto maker for 74 consecutive years, and we are fighting hard to stay on top.

    Beyond that, our performance in the marketplace has not been what we have wanted it to be. While we have been strong in truck sales, we have been weaker in cars, and, yes, the recent surge in gas prices hurt sales. While we have led in technologies like OnStar, we have lagged in others like hybrid vehicles. Rest assured, we are working hard to address the areas where we lag. Simply put, we are committed to doing a better job of designing, building and selling high-quality, high-value cars and trucks that consumers can't wait to buy. No excuses. We will step up our performance in this regard.

    But competition and marketplace performance are not the whole story. To fully understand why GM and the U.S. auto industry are struggling right now, we have to understand some of the fundamental challenges facing American manufacturing in general, challenges well beyond the control of any single company.

    There are those who ask if manufacturing is still relevant for America. My view…You bet it is! Manufacturing generates two-thirds of Americas Rand D investment, accounts for three-fourths of our exports, and creates about 15 million American jobs. And the auto industry is a big part of that, accounting for 11 percent of American manufacturing, and nearly 4 percent of U.S. GDP. Together, GM, Ford and DaimlerChrysler invest more than 16 billion in research and development every year…more than any other U.S. industry. And GM, alone, supports more than one million American jobs.

    So what are the fundamental challenges facing American manufacturing? One is the spiraling cost of health care in the United States. Last year, GM spent 5.2 billion dollars on health care for its U.S. employees, retirees and dependents, a staggering 1,525 dollars for every car and truck we produced. And the figure is going up again this year. Foreign auto makers have just a fraction of these costs, because they have few, if any, U.S. retirees, and in their home countries their governments fund a much greater portion of employee and retiree health care costs.

    Some argue that we have no one but ourselves to blame for our disproportionately high health care legacy costs. That kind of observation reminds me of the saying that no good deed going unpunished. That argument, while appealing to some, ignores the fact that American auto makers and other traditional manufacturing companies created a social contract with government and labor that raised America's standard of living and provided much of the economic growth of the 20th century. American manufacturers were once held up as good corporate citizens for providing these benefits. Today, we are maligned for our poor judgment in giving away such benefits 40 years ago.

    Another factor beyond our control is lawsuit abuse. Litigation now costs the U.S. economy more than 245 billion dollars a year, or more than 845 dollars per person. That's more than 2 percent of our GDP. No other country has costs anywhere near this level. And the perverse thing is that, in many cases, the majority of courtroom settlements go to the lawyers and other litigation costs, not to the injured parties.

    Another major concern is unfair trading practices, especially Japan’s long term initiatives to artificially weaken the yen. A leading Japanese auto maker reports that for each movement of one yen against the dollar, it gains 20 billion yen in additional profitability or nearly 170 million dollars at todays exchange rate. No wonder Japanese auto makers have noted their recent record profits were aided by exchange rates. And no wonder the U.S. trade-balance deficit continues to grow by leaps and bounds.

    There are other issues, of course, but my point is this: We at GM have a number of tough challenges that we must and will address on our own, but we also carry some huge costs that our foreign competitors do not share.

    Some say we are looking for a bailout. Baloney, we at GM do not want a bailout. What we want, after we take the actions we are taking, in product, technology, cost and every area we are working in our business today is the chance to compete on a level playing field. It's critical that government leaders, supported by business, unions and all our citizens, forge policy solutions to the issues undercutting American manufacturing competitiveness. We can do this. And we need to do it now.

  3. #48
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    What a Lark

    Not the story, but the idea I just got.

    Does anyone know someone "dreaming" of buying a new GM vehicle in the near future?

    Me either, maybe that is GM's real problem.
    Casper, the Friendly Ghost.

  4. #49
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    Re: What a Lark

    Originally posted by scooooooter
    Does anyone know someone "dreaming" of buying a new GM vehicle in the near future?
    I'm not a GM fan, but I'd bet there are plenty of people dreaming of a new Vette, Hummer or Cadillac.

    I'm dreaming of a Ford GT, but realistically I'd settle for a Jeep Gladiator if they ever come out with it. Until then I'll drive my Ford E250 work van
    Everyone has a right to be stupid, but some abuse the privilege

  5. #50
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    I talk to people every day that are dreaming of a new GM vehicle

    The problem is the dreaming starts after I tell them the price.



    I have a one year waiting list for the new Pontiac Solstice.


    Tim Holloway

  6. #51
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    Don't bet, you'll lose!

    Why own a GM when there are so many other , better , vehicles on the road? The 3 you named, what are they good for? Too many other makes out there that are much more appealing to the public, cost less, or have more features and reliability.

    GM keeps trying to buy out the competition, but everything has caught up to them. Tough Luck!
    Casper, the Friendly Ghost.

  7. #52
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    Well Scooooooter, the Cadillac is the most famous American made luxury car of all time. The Corvette is without a doubt the best sports car for the money in the world and the Hummer 3 is a true four wheel drive all-terrain vehicle for under $30,000.

    Please name for me any other single manufacturer that can compete with GM in the price range.
    Everyone has a right to be stupid, but some abuse the privilege

  8. #53
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    The Cadillac is living in the past. Try a BMW, Mercedes, Acura, Lexus, even a Lincoln. The best sports car in the world would be a Mazda Miata. Competing with the Corvette though would be the Ford GT, BMW, Mercedes, Acura, Lexus, Porsche, even the lowly Mustang. And the Hummer, another vehicle that GM bought out because they couldn't compete. Any 4 wheel drive SUV can compare, and probably be more appealling once owned and used in the real world.

    My point is that GM has a lot of competition (not necessarily only 1 manufacturer) for the public's appeal. And that is where they are losing Big time. 40 years ago the US auto manufacturers didn't have to worry about competition because they owned or bought it out. In 2005 that is not the case. Go back 50 or 60 years and the big 3 had a monopoly. It ain't so today.

    You still haven't named a single person "dreaming" of buying a GM vehicle that you know of. Me? I'm dreaming of the next slotcar I want to buy or build. How 'bout you?
    Casper, the Friendly Ghost.

  9. #54
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    I'm dreaming of buying ANYTHING new, but I generally buy something 2 years old, I hope that doesn't make me a bad person.

    I'm dreaming of a 1991 Ferrari F-40......

    I have to admit - for the money the Corvette is the best sports car dollar-for-dollar out there........ but that doesn't mean I want one.

    If you have the money to gas it - a Hummer H3 is OK, but in today's world, I think lasting quality is the first thing you look for, followed closely by gas mileage..... if you think we won't see anymore hurricanes in the gulf, guess again, and be prepared.

  10. #55
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    Originally posted by scooooooter

    You still haven't named a single person "dreaming" of buying a GM vehicle that you know of.
    You still haven't named a single company that puts out all three types of vehicles that can compete with GM for the same price.

    Scooooter when you get my age people don't dream about buying a car they just go buy it. Do you think a Mazda Miata could beat a Corvette in a race? I sure as hell don't know anyone dreaming of buying a Miata. I know there are better sports cars than a Corvette, but not for the same price. And I don't know of any production sports car that holds it's value like a Corvette either. I bought a new Porsche 928 in 82 for $45,000.00. Today it would be worth about $3500.00. A Corvette in 82 was about $24,000.00 and I'd bet it's still worth more than $3500.00.

    Cadillac is still a fine car with lots of features and in my opinion American cars are just as reliable as Japanese cars are.

    The difference between the Hummer 3 and most 4 wheel drive SUV's is the Hummer is a true 4 wheel drive. Which means all 4 wheels pull at the same time and don't alternate left front/right rear and visa versa. The only other one that I know of that is a true 4 wheel drive is a Jeep Rubicon and probably a Range Rover, but there are probably others.

    And Fredman, the Hummer 3 supposably gets a little over 20 miles to the gallon, not bad.

    Supply and demand are definitely hurting American automobile manufacturers. There's just way to many brands on the market.
    Everyone has a right to be stupid, but some abuse the privilege

  11. #56
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    Yeah, 20 mpg (I bet on the highway, where 20% or less of normal everyday driving is done) isn't bad for an SUV, but it's not quite good enough, for me anyway.
    My next car will be 30+ mpg in the city. My concern is the next 3-4 hurricanes to hit the gulf over the next few years, it won't be pretty.

    Let's be realistic - look at resale value of cars 5 years down the road, and I don't mean 'Vettes. A 5 year old mid-size Chevy just won't bring as much - anywhere close - as a Honda or Toyota. I don't think ANY 5 year old car from the big 3 will.
    I'm talking normal-people cars like a Malibu or Taurus, not a Mustang or Corvette, or even a Monte Carlo.

    Please keep in mind - I'm saying it's a real fickle car market: some cars bring 'fair' money, some don't. Silver Intrepids are a dime a dozen (I know - I own one), some Buicks bring decent money.
    The difference is (it seems) - ALL Hondas, Toyotas, and even Datsuns bring good money, most other car lines don't, across the board, unless you get into Lexus, Acura and Infinity.

  12. #57
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    Originally posted by Fredman

    ALL Hondas, Toyotas, and even Datsuns bring good money, most other car lines don't, across the board, unless you get into Lexus, Acura and Infinity.
    You're showing your age when you say Datsun. This is a good thing for people like yourself who buy cars that are two years old and don't care if it's a Honda, Toyota or "DATSUN".
    Everyone has a right to be stupid, but some abuse the privilege

  13. #58
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    Mitsubishi

    Closing plant in CA and moving to Tenn. thanks to Tenn. giving them a $164 million incentive to relocate. Our tax $$ at work again.

    Miatas beat corvettes all day long at the tracks like willow springs and in the resale dept. Now do you want to talk about reliability? How about the 50/50 weight ratio? Ever driven a Spec Miata? Corvettes suck, what is their MPG?

    Only good thing about the H3 you mentioned is that when it goes in the ditch (because of the type of 4 wheel drive you mentioned) is that you probably will be able to pull your selve out. Have you talked to anyone after they have owned one for awhile? They don't like driving them.

    Want me to name 1 company that can compete with GM? Easy, how about BMW, or Mercedes, or Toyota, shall I go on?

    I can go right down the street and buy a 2005 GM Malibu for $9500, or a 2005 Impala for $10,500, or a 2005 Buick Regal for $10,500, or a 2005 Buick Century for $8500. Get the picture? Nobody wants them. And they all average 27 MPG.
    Casper, the Friendly Ghost.

  14. #59
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    Re: Mitsubishi

    Originally posted by scooooooter

    I can go right down the street and buy a 2005 GM Malibu for $9500, or a 2005 Impala for $10,500, or a 2005 Buick Regal for $10,500, or a 2005 Buick Century for $8500. Get the picture? Nobody wants them.
    Scooooter, the more I think about this the more I agree with you. They probably don't want them because the UAW built them, and that is the title of this thread isn't it? "Unions Kill GM"

    Get the picture?
    Everyone has a right to be stupid, but some abuse the privilege

  15. #60
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    Scooooter,

    Sorry your wrong.

    The New Pontiac Solstice blows the miata away.

    Comparing a Vett to a Miata .

    In what catagory do you want to compare them? other than price the vett beats the maita in every catagory.

    Tim

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