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Author Topic: Why do companies like GM fail?  (Read 2342 times)

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Offline Rebel

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Why do companies like GM fail?
« on: February 18, 2009, 01:18:56 PM »
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Offline Chris_

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Re: Why do companies like GM fail?
« Reply #1 on: February 18, 2009, 01:52:27 PM »
Quote from: Rebel on February 18, 2009, 01:18:56 PM
Take a look at these UAW salaries:

http://www.unionfacts.com/unions/unionOfficers.cfm?id=149&year=2006

Scary.  Those are just the ****ers that fleece the union rank and file.  Not a friggin' one have ever designed a better vehicle, or so much as turned a friggin' wrench in their miserable lives, in all likelihood.

And you wonder why that new vehicle your wallet got raped and pillaged for just dropped a third (or more) of it's "value", the moment it crossed the dealership's property line?!?!
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Offline DumbAss Tanker

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Re: Why do companies like GM fail?
« Reply #2 on: February 20, 2009, 11:35:04 AM »
The union wages issue is one part of a bigger problem, the failure to successfully balance short term return vs. strategy for long term viability.  For publicly-held companies, there is a legal and structural bias toward the annual bottom line at the expense of things necessary to make the company work beyond a five-year horizon.  Agreeing to the UAW's insanely-expensive pension plan when a company could afford it 'for awhile' is a classic example, but there are plenty that involve capital investment and strategic vision issues rather than simple labor overhead.
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Offline Chris_

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Re: Why do companies like GM fail?
« Reply #3 on: February 20, 2009, 11:41:03 AM »
Quote from: DumbAss Tanker on February 20, 2009, 11:35:04 AM
The union wages issue is one part of a bigger problem, the failure to successfully balance short term return vs. strategy for long term viability.  For publicly-held companies, there is a legal and structural bias toward the annual bottom line at the expense of things necessary to make the company work beyond a five-year horizon.  Agreeing to the UAW's insanely-expensive pension plan when a company could afford it 'for awhile' is a classic example, but there are plenty that involve capital investment and strategic vision issues rather than simple labor overhead.

That is pretty much it.......plus focusing solely on the financial implications of business decisions, rather than focusing on product content, innovation, and market share. 

doc
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Offline Ptarmigan

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Re: Why do companies like GM fail?
« Reply #4 on: February 20, 2009, 01:33:59 PM »
I know the UAW has a strong presence in Michigan. Isn't Michigan a right to work state? From what I know it is.
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Offline Rebel

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Re: Why do companies like GM fail?
« Reply #5 on: February 23, 2009, 01:26:19 PM »
Quote from: Ptarmigan on February 20, 2009, 01:33:59 PM
I know the UAW has a strong presence in Michigan. Isn't Michigan a right to work state? From what I know it is.

No, it's a forced-union state.

http://www.nrtw.org/rtws.htm
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Offline TheSarge

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Re: Why do companies like GM fail?
« Reply #6 on: February 23, 2009, 09:27:02 PM »
GM is also burdened...thanks to the UAW...with paying all of those benefits of employees who retired 20-30 years ago.
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Offline Wineslob

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Re: Why do companies like GM fail?
« Reply #7 on: February 24, 2009, 04:06:20 PM »
Quote from: TxRadioguy on February 23, 2009, 09:27:02 PM
GM is also burdened...thanks to the UAW...with paying all of those benefits of employees who retired 20-30 years ago.


Bingo! What was it, something like every Big 3 car has a $1500 adder just to cover Union costs compared to the Japanese with only $200?
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Offline 5412

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Re: Why do companies like GM fail?
« Reply #8 on: March 06, 2009, 07:36:49 PM »
Quote from: freedumb2003 on February 24, 2009, 04:16:18 PM
As many of you know, I travel for a living.  I get a different rental car every week (Forrest Gump was wrong -- it is rentals not chocolates). That means I have had probably 100+ different vehicles over the last 3 years or so.

I can 100% tell you that I dread getting any American car.  They creak and crik, they frequently have wind whistles in the windshield and/or windows.  The acceleration is never smooth (this is ESPECIALLY TRUE of Fords), the controls and seating are not ergonomic, and they always feel cheap and "plasticy."  Other than a few cab forward cars, they don't steer well and feel sluggish on cornering and dreadful on braking.

The same is not true of Nissans and Toyotas. They are quiet as can be, they don't make funny noises and it always seems like the controls are where they "ought" to be.  The acceleration, even in the smaller engines, is smooth and doesn't lurch between gears.  And they always feel solid, like the old Detroit Iron used to be, but nimble in the handling..

I WANT to like American cars, but the makers don't seem to yet get the message. 

Oh, these rentals are rarely over 2,000 miles (as an elite member I get the newer cars), so you can't really blame "who cares? it is a rental" syndrome.

But there is a bright light: American cars are better than Korean ones.



Hi,

Couple of points.

1.  I spent 40+ weeks a year on the road for over 35 years and I will totally agree with you.  I now own 4 foreign cars.

2.  The statistic I heard when they were discussing the bailout is this.  It costs every American auto maker $2700 per vehicle for union wages, benefits and retirement benefits.  It costs the Japanese automakers $700 per vehicle.  The argument that American automakers need to make vehicles Americans want is bogus.  Makes no difference if it is the biggest SUV or the smallest economy car, the foreign automakers can build in more quality, sell it for a lower price, and still make a much bigger profit.  Until the auto makers file bankruptcy and renegotiate with the unions like the airlines had to do, no amount of bailout money, or prayer for that matter is going to make much difference. 

regards,
5412
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Offline Willow

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Re: Why do companies like GM fail?
« Reply #9 on: March 19, 2009, 11:55:37 AM »
Quote from: Ptarmigan on February 20, 2009, 01:33:59 PM
I know the UAW has a strong presence in Michigan. Isn't Michigan a right to work state? From what I know it is.




No! it's a FAILED state.
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