Hargrove 'fearful' for future of GM, Ford

[doh]

http://ctv2.theglobeandmail.com/serv...N/ctv-business

OMAR EL AKKAD AND GREG KEENAN, Globe and Mail Update




The North American operations of Ford Motor Co. and General Motors Corp. could be forced into bankruptcy within a decade if Canada and the United States don't act to halt imports from South Korea and Japan, Canadian Auto Workers president Buzz Hargrove warned Tuesday.

Losses in market share are causing the two largest U.S. auto makers to scale back their operations in North America even as they increase their sales and investment in offshore markets such as South America and China, Mr. Hargrove said.

"I'm very fearful. Every month when I look at the numbers, the market share losses just keep growing. [For] Ford and GM I think there's only one scenario if you don't stem the market share losses," he said, following a meeting with Prime Minister Stephen Harper in Ottawa.

His comments came on the same day that GM announced a record auto industry loss of some $38.7-billion (U.S.) and revealed that it once again lost money in its home market of North America last year while turning a profit in Asia, Europe and Latin America.

That in turn, was just one day after auto parts maker Martinrea International Inc. announced that it is shutting its largest plant in Canada — the largest shutdown yet in a series of plant closings that has wiped out more than 11,000 jobs in the country's auto parts sector.

Mr. Hargrove has been seeking a meeting with Mr. Harper since the Conservatives were elected two years ago. The crisis afflicting segments of the auto and auto parts industry has deepened since then with the meteoric rise in value of the Canadian dollar.

"Just getting the meeting, I feel like a winner, after two years," Mr. Hargrove said.

But he outlined a litany of problems facing the industry, including the number of imports from Asia and Europe that far exceed the number of vehicles shipped there from Canada.

The union wants Mr. Harper to make a public statement saying Canada will no longer allow such imports to enter North America unless Japan and South Korea in particular open their markets to North American vehicles.

The CAW wants the Prime Minister to help persuade the United States to take the same action in a new North American auto pact.

The threat to the North American auto industry is evident right now with vehicles from South Korea and Japan, Mr. Hargrove said, even before low-cost vehicles from China and India begin arriving here in the next decade.

Mr. Hargrove pointed to GM's financial results released Tuesday as evidence of how the home market is becoming less important to the Detroit Three.

"GM is saying within a decade 75 per cent of their sales will be offshore," he said.

Much of their production will be as well, he said and that threatens jobs in Canada, where the Canadian units of Ford, GM and Chrysler LLC employ about 40,000 Canadians. Mr. Hargrove said Chrysler is already restructuring in other ways that will make it a smaller auto maker.

[K-1]

He's only "fearful" because the future may not include his overpriced self.

[macphisto]

Halt imports? That would have a devastating impact on the economy, trying to force people to the domestic brands to save their unions.

If Hargrove really wanted to save GM and Ford then he'd push to de-unionize them. Both companies also need massive reductions in their white collar bureaucracies still.

[1931Chevy]

The only think I agree with him is that Japan should eliminate the tariff it has on imported vehicles, because now he is fearful but threatens to shut down GM in the new negotiations

[SUPERBADD75]

the U.S. market has shown that it supports good products and bad ones don't typically last long. then again, they will also support low prices, so as long as GM and Ford offer the best cars they can at the lowest prices, they're good. now it wouldn't hurt my feeling to see the government add a small tariff to imports to kind of help out a little bit. it would put some money back into the nation as well as support American business and American jobs by giving them a little price advantage. all in all, if GM keeps making cars like the new Malibu and CTS and Ford can follow suit, then they'll be okay. convincing people that American cars are back will be easy once the proof is on the road.

[01IntrigueGX]

As aforesaid, he should push for the de-unionization of the auto companies for a more competitive stance in the marketplace in regards to GM and Ford. Not only that, but maybe the US should try to slash the VER's that were enacted in the 1980's with Japan too.

[tholland]

Once again, I have to question why he thinks Japan and Korea would want any of the domestic vehicles made in Canada. I think he's smoking the same drugs as Dalton.

[Ambalanche]

Originally Posted by 1931Chevy

The only think I agree with him is that Japan should eliminate the tariff it has on imported vehicles, because now he is fearful but threatens to shut down GM in the new negotiations

You took the words right off my fingertips!

[chakis24]

a free market only works if everyone's a player. the u.s is the only one. tariff them all.

[prototype66]

Whats that sound..........like a sucking sound?

[Olds88]

Originally Posted by tholland

Once again, I have to question why he thinks Japan and Korea would want any of the domestic vehicles made in Canada. I think he's smoking the same drugs as Dalton.

I just saw something on TV recently about how American Vans (think E-series and Ramvan) are "cool" with the youth in Japan and people are paying big money to get them. Cars like Solstice would sell well in Japan. I think there would even be a market for Vue and possibly a lambda or too.

[tholland]

Originally Posted by Olds88

I just saw something on TV recently about how American Vans (think E-series and Ramvan) are "cool" with the youth in Japan and people are paying big money to get them. Cars like Solstice would sell well in Japan. I think there would even be a market for Vue and possibly a lambda or too.

That's nice to hear, but they are talking about vehicles built in Canada. I'm sure a 300, Charger, Challenger, or Camaro would be considered cool there too, but I doubt there would be the kind of equal export demand they are fantasizing about.

[PA Dweller]

The sky is always falling.

[Markviii]

God Bless This Man!! Long Live The Union Worker!

[VCDJ]

Finally somebody with a brain. All vehicles made outside U.S. and Canada should be taxed. That should include gm, ford and chrysler. And the once that are built in U.S. and Canada should also be taxed if they use less then 80% of parts that are from U.S. and Canda. This is the only way American industry will be saved. How can anybody compete with korean cars when they make them for next to nothing. Or japanies cars with yen so weak. European automakers are in even greater disadvatige. They pay their workers more then American automakers do. Plus euro is stronger then dollar. That is why european union has tax on imported cars. America and canada shoudl do the same. U.S. And Canadian goverement does not realize that free trade does not work if only one side praticipate in it. Can anybody in America work for $5 per day and still be able to afford a house that is 200k and by a car that is 20K. Well in China they can because, they have cheap cars, Cheap house, Cheap Food. Free trade does not work. It only hurts america and canada. Made lutz should talk more about this then how global warming is S***. I think it is too. But most people do not want to hear that. How does that help gm by saying that???
Did you guys realized that it is cheaper to by Mercedes and BMW in America then it is in europe. I love mercedes and i drive one, i would not trade it for anything else. but why would govr. let that happen.