Trophy Blue

GM's labor cost is $30.00 more per hour than the Japanese.

Grey Ghost

I read and article that says all U.S. manufacturing accounts for 12% of the gross domestic product, a distant second to the financial services sector, which is more than 20%. The U.S. is more of a money pusher these days than the once manufacturing giant of past.

I and several generations of my family have always been in the south. I live near the carpet capital of the world, Dalton, GA. There are and have been huge manufacturers of various floor coverings here. There has never been a union in any of the plants. You work and look after yourself instead of thinking the company will keep you up in your old age. I would love to have a pension when I retire. But, I have to take on the responsibility of myself and not rely on a company.

Ronald Reagan saved Harley Davidson by placing tariffs on imports of large cruiser bikes. It gave HD time to make a better product and take care of in house issues. Now they lead in the large cruiser segment. I think the same is the only way to ever save the big 3.

I have always been a GM customer. If I had more security with my job I would buy a new truck today. Its just the uncertanity of the future of my job that keeps me from it. The company's here are laying off hundreds of people almost weekly. The housing market touches untold numbers of people and jobs.

I always try to buy American made goods. John Ratzenberger (cheers fame) had a good tv show about items still made in the U.S. I will spend the extra money for the product to help keep jobs here.

MikeM

You obviously have me confused with someone else. As a matter of fact I was in the UAW. Paid dues for 6 years. Graduated to middle management in FOMOCO. Worked 31 years and retired with a decent pension that was supplemented by social security check every month. Yes, that's right, those big auto comapanies pay a part of it and Social Security chips in the larger protion. But you never read that in the newspapers now do you? You also never read that many retirees don't draw too many checks before they pass away.

Medical benefits you say? I used to have a pretty good plan on that. Fully funded. Not anymore. I get about $1800 a year to buy my medical insurance now due to cuts in the program. Too expensive you say? Well, I don't see any of our electeds doing anything to drop the cost of medical care. All they do is argue over who is going to pay for it. Many of their decision have not only allowed, but caused medical costs to go through the roof. If you don't think Medicine is a lucrative business, just look around at all the glass palaces where you go to get an aspirin when you're sick. I used to have about $100K life insurance policy paid for by the company. Not anymore. They took that too. It's a little more than enough to put me in the ground and a notice in the newspaper in the obit.

Savings? fortunately, I was diversified. While it is true I have lost big bucks the last few years because of no FOMOCO dividends being paid, I'm still getting by okay. Stock value is worth about 6% of what it was just ten years ago.

I was promised a pretty good retirement when I went to work there. I did what I said I was going to do while I worked there and did it well. All I expect is the company to do what it said it was going to do. They're not and neither is GM or Chrysler.

Somebody said it pretty well in just a few words in another thread. Upper management needs an attitude adjustment to their "entitlement mentality". But I'll add a little something. They need to get rid of the need for "instant gratification" and start running their business long range. Unfortunatly, Wall Street hinders this to some or a large degree.

The Big Three knew twenty years ago there was going to be excess manufacturing capacity in this country. They also knew that they would either have to grow/expand or wither, as soon, there would only be a handful of auto manufacturers left in the world. They knew. They said this. What happened?

One thing that happened was the Big Three pulled out their financial doldrums and started making money hand over fist (at least, Ford did). Any labor contracts negotiated from that point on were predicated on not only increased sales but increased market share as well. If that would have happened, the negotiated labor contracts and other large, fixed expenditures would not have been a burden. When I retired 11 years ago, I think the average UAW profit sharing check was about $5000! Well, turns out none of the Big Three increased sales or market share. You know the rest.

One last thing. This country was built on good wages for the middle class. Where most everyone was making a good wage. That is now a thing of the past for the masses. As the manufacturing jobs have left this country and gone elswhere, those decent paying jobs have been replaced by jobs with half the wages. Everybody's still working, just not making anything. Any wonder new car loans started going 84 months? Home loans, no money down and cheap rate to start with? Credit card debt to record levels? See your elected politicians about why all the manufacturing has left this country.

This whole economy has been running on air for the last twenty years or so and why the American public couldn't see that is beyond me.

The reason it didn't get stopped is called greed, graft and corruption.

Am I Pi.... about what's happened? You betcha! I put in 31 years for an auto company along with a lot of other people that worked their tails off and it galls me more than a little to hear people crack on Big Three auto workers, whether they be UAW hourly or salaried workers. Many of these people that are popping their jaws about it are the same ones that buy foreign cars and send their money overseas. When their job follows, maybe they will eat their foreign car when they get hungry. Or their foreign carpet, shovel, TV, etc., etc.

Mr union man, eh? I'm done.

al329

Sell while you can still get out!!!

"Analysts said Monday that current shareholders were now in a lose-lose situation: They may be wiped out as part of a federal bailout, or they may be wiped out if the government stays away and GM ended up in bankruptcy."

http://money.cnn.com/2008/11/10/news...tock/index.htm

65coupe

MikeM,
It sounds like you changed your tune already.
If you're retired you are lucky fimancially than those that haven't. Same in the garment industry but worse. Those retired will have alot more than I will ever get. I make almost half of what I made 15 years ago.
despite that ther are guys on line for my job as the industry contines to shrink on both the whoesale and retail side.

philip964

This is a really big subject, and probably can not be solved here, but I will wade in briefly with some thoughts. Paragraphs help alot so I will include them.

The world is changing rapidly.

Globalization is changing the way work is done in the US and in other countries.

Unions are not as strong as they once were.

Management in the past made promises that were not kept, because they were promises that could be made to go away by bankrupsy.

Health care costs tremendously more than it used to because technology can now keep dead people alive. In systems where you pay or have insurance, it generally provides better outcomes than government run systems, where resources are allocated. If you do not believe me ask Lady Di or Yasser Arafat.

Management does not always represent the shareholders because they really look out for themselves.

Buy and hold is a stragety of investment, but it does not always work. Diversification does work, but you do not make as much money as putting all your eggs in one basket and being lucky.

Do not put all your egg baskets next to each other.

Gas was $1.91 in Houston today. Does this mean everyone is going to go out and buy Hummers again? Or has something changed.

The big three used to be the only game in town. Thats not the case anymore. They make much better products now. I know because I rent them. However, I owned a GM diesel long ago and I doubt I will own another GM sedan.

Seaside63

If GM goes under will Holden, Vauxhall and Opel go with it? I thought those divisions were doing very well.

Right now GM stock is selling at $2.82 - not much room left to zero.

Can't buy because I'm convinced they will cancel the common stock and protect the bastards at the top holding preferred stock.

American Business Management in all their glory!

ratpack1968

Preferred stock always takes preference over common shareholders in the event of a liquidation. Just as Senior debt takes preference over subordinated debt, preferred and common shareholders. Preferred shareholders give up voting rights in exchange for this preference. Its not some grand conspiracy to shaft the little guy.

philip964

Interesting story. Not what I expected.

http://www.bloomberg.com/apps/news?p...efer=worldwide

A strategic bankrupsy (chapter 11) is apparently not an option. There only choice is to stay in business or liquidate (chapter 7)

Cash to pay their bills is the problem. The credit crisis which has turned upside down the lending market, will I assume not loan them the money.

This problem was brought to the forefront by the gas price increase and now poor economy and not being able to finance purchasers (GMAC) slowing sales which rapidly depleates their cash.

Normally there would be Lehman Bros, WaMu, etc. waiting in the wings to loan them cash after they declared chapter 11. Stockholders, unions, retirees screwed. But there is no one to lend them cash now.

So its stay in business, be rescued by Obama or reluctantly Bush. Or be liquidated. Stopping production and the parts sold to the highest bidder. No more Corvette unless someone picks it up and runs with it.

What a mess.

The bonds are selling at 25 cents on the dollar if you gamble.

Dan Hampton

RatPack:

No help for the preferred holders, either. The bonds are trading at pennies on the dollar and they have priority over the preferreds. Everyone is going to eat it on this one.

DH