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Insider Opinion On GM-UAW Strike

10K views 116 replies 32 participants last post by  CaptainDan 
#1 ·
The New York Times
September 24, 2019

By Steven Rattner
Mr. Rattner served as counselor to the Treasury secretary and head of the White House Auto Task Force in the Obama administration.


After years of labor peace in the automobile industry, about 50,000 members of the United Automobile Workers have gone on strike against General Motors, seeking to redress years of pain, particularly during the 2008 recession and subsequent rescue by the Obama administration.

Having headed President Barack Obama’s auto task force, I’m deeply sympathetic to the plight of blue-collar workers in the automobile industry. But unfortunately, when it comes to the manufacturing sector, where the United States faces global competition, restoring the generous pay and benefits that used to accompany these jobs becomes impossible without jeopardizing the jobs themselves.

The financial challenges of Americans toiling in the auto sector have been building for nearly two decades. Wages for blue-collar workers in the sector peaked (after adjusting for inflation) back in 2002 at $30.90 per hour, which was then roughly 44 percent more than the average for all jobs across the economy. Today, those once-prized jobs pay just $23.48, a thin dime less than what a typical worker across the economy earns.

The principal culprit? Lower wages in emerging countries, particularly Mexico. At $3.29 per hour in 2015 (the most recent date for which reliable data is available), auto workers in that neighboring country were paid less than 14 percent of what the same worker in the United States earned. That didn’t matter so much when Mexican auto employees were less productive than their American counterparts. But even a decade ago, when I was working on the auto rescue, executives at the Detroit companies told me that their plants in Mexico were running just as efficiently as those in the United States.

Since then, that pay gap has been partly closed, but not surprisingly the union wants it closed faster. Meanwhile, the U.A.W. is fighting to preserve for existing workers one of the most generous health care plans in the country; its members pay only about 4 percent of their medical bills. (By comparison, workers across the country pay an average of 28 percent of their health care costs, according to the Henry J. Kaiser Family Foundation.)

I’m all for workers earning more, but it’s important to understand that, at least in the car industry, this is not a case of rapacious investors profiting at the expense of workers. Since its initial public offering in November 2010, G.M. stock has risen by only 13 percent, compared with 154 percent for the overall market.

We need to be realistic about these challenges. The United States government can support the auto industry with initiatives like the new trade deal with Mexico, which would require that 40 to 45 percent of the vehicle is made by workers earning at least $16 per hour. But Mr. Trump’s flowery rhetoric notwithstanding, we’ll be lucky just to keep the jobs we have now.








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#2 ·
I’m all for workers earning more, but it’s important to understand that, at least in the car industry, this is not a case of rapacious investors profiting at the expense of workers. Since its initial public offering in November 2010, G.M. stock has risen by only 13 percent, compared with 154 percent for the overall market.
There will be no "winner" when the strike is settled.

Here's hoping the two sides can get along well enough to serve their customer base with efficient, value oriented and high quality products.
 
#23 ·
No mention in the article regarding the numerous felony criminal convictions of high-ranking UAW officials, or the arrests of striking UAW members in Tennessee.

I think the UAW underestimated GM, and many of their members will lose in the long-run. I also think high-ranking UAW officials encouraged the strike in an attempt to deflect attention from their massive criminal behavior and schemes. It will catch-up with them.

When the striking UAW workers finally return to work - I’ll bet they will be angry and frustrated, and some will intentionally perform poor assembly work.

I have no connection to the UAW - but have owned GM vehicles continuously for 50 years.
 
#4 ·
I understand your point, but one would be hard pressed to find someone with more knowledge of both sides of the industry.

wikipedia.com:

In February 2009, with General Motors and Chrysler insolvent, Rattner was appointed counselor and lead auto adviser to the United States Secretary of the Treasury, a role informally referred to in the media as the "car czar". He soon assembled a team that grew to 14 professionals to address the financial problems of the two auto companies.

Reporting to both Treasury Secretary Timothy Geithner and Lawrence Summers, the head of the National Economic Council, Rattner's team developed a plan to save both the two manufacturers and related suppliers and finance companies. The plan involved a total government (i.e., taxpayer) investment of $82 billion in the sector, coupled with controlled bankruptcies for the two auto companies, as well as new management for both, and the closure of 2,000 automobile dealerships and loss of tens of thousands of related jobs. Controversially, during the negotiations with the bond holders, Rattner threatened their professional reputations in order to get them on board with the controlled bankruptcies

Rattner later stated that the toughest decision for President Obama about the two auto companies was whether to save Chrysler. There was, however, no disagreement about asking GM CEO Richard Wagoner to step aside. By July 2009, both automakers had emerged from bankruptcy, had new management and were on their way to profitability.







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#6 ·
I read recently that there is a $13 hr. total compensation gap (wages, retirement, insurance,etc.)
 
#8 · (Edited)
The UAW pays for health insurance during the strike but GM usually pays for health insurance. As a matter of fact, the workers pay $0 in premiums and 4% of total costs. What I find ironic is that the politicians who say they support the UAW (ie. Bernie Sanders) want to ban private plans and implement a national plan that would require premiums along with much more than 4% cost sharing. The politics are beside the point but this helps show that the health insurance offered by GM is amazing and complaining about it get's no sympathy from those on the outside.
 
#17 ·
I'm not a union person. but I do feel the UAW helped make this country what it is today. I think GM needs to give more to their workers. When times are tough they will idle production lines and lay people off. With all the automation, there will be fewer and fewer UAW workers in the future. It's very clear that GM has no plans of expanding in the US anyway.
 
#29 ·
"Just tax the wealthy"

If it were that easy, we'd have done it by now. Marginal rates have been as high as 90%+ in the US. Still not enough to cover free healthcare.

Now, if you want to undo the Truman doctrine, remove our global military presence and all of its costs, and hope that China and Russia don't fill that void, at least that would make some level of fiscal sense to pay for healthcare. But that's a lot of faith in two regimes that aren't friendly to anyone but the world's worst.
 
#50 ·
Reality is that corporates have to pay VPS and CEOs enough to attract the right people but keep in mind that the sum total paid is a mixture of cash salary and stock options that can only be exercised once the stock is at or above a nominated price.

Some of the compensation packages look a bit high but good luck to them, getting money out of GM or Ford is like getting blood out of a turnip
 
#55 ·
I don't know how anyone could call her underpaid.

She's a big girl, she was given an assignment and she carried it out. She's in the upper echelons of command at a major corporation, her job is to do her job.
GM owes her nothing extra speshul for doing what she's supposed to do.
 
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#62 ·
Thanks. You've added a great deal to the discussion here.

You're welcome. It's probably for the best. Your sister can do better than a UAW job.
Only if she's running a higher IQ than brother.
 
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#65 ·
Look, I understand that you are upset about your sister. I get that. However, GMI is just an automotive forum and has no ties to GM whatsoever.

Members here hear the same news as you. There is discussion about it but the "Inside" part is in name only.

Coming to a forum and insulting people right off the bat isn't the best way to get a positive response. No one here is responsible at all for what GM does.

What have I heard? That GM isn't willing to concede anything more to the UAW. My opinion? The UAW should have taken the final offer before the strike. Also I've heard that the general public has very little sympathy for the union workers this time around. That's about it except if GM ever starts building all the electric cars they keep talking about they are going to need a lot less workers. No way around that, it seems.
 
#67 ·
I read that the auto manufacturing firms like Subaru and Mitsubishi have a payroll package in a "Work Free' state like Alabama is $14.41 per hour and a modest Health care HMO and a small but useful 401K that will worth something that will pay nicely for long time workers. But I wouldn't be surprised if GM relocated to a 'work free' state. The UAW has become an anchor puling GM and other companies like Ford and Chrysler down. And If there is one major complaints with GM is poor quality and fitment. Ford has been pretty successful with their 2.7 turbo V6, GM, inline 4 cylinder, not so much. I was talking with a private shop owner and in our discussion, ICE profile in the future, I told him I would look into Propane conversion equipment. I think that is going to be the easiest way to keep ICE vehicles on the road, current and older cars and trucks.
 
#81 ·
GM couldn't relocate to any other state because it's that the union is so entrenched. The UAW is like a fat, blood sucking tick on GM. The workers of the Detroit 3 would have to vote the union out in order for them to do what the import manufacturers offer to their employees. And as we've seen, the few times that the vote has come up, the majority of employees vote to keep the union in.
 
#73 ·
Well this thread took a turn...

Vette77...dude no one here is affiliated with GM in any form, this site hasn't had any inside news since 2016 so your anger, while somewhat understood, is sadly misdirected.
 
#98 · (Edited)
Originally Posted by IROCNROL1

I suppose I could buy a Mustang instead unless Ford goes on strike next. Say, what about a Kia Stinger? Now that might work.
The scuttlebutt is that Ford and FCA's negotiatons are all but done deals
but will stay in the background until the GM contract is secured and ratified.

All the assertions about GM can't afford to do this or that is just so hollow
when you know that the other two deals are almost done without a smell
of a strike anywhere. It's just another example of GM being incapable of
dealing with the UAW without trying to slam the door in their face.
 
#99 ·
GM has a bigger gap in hourly wages/compensation compared to Ford and FCA. Regardless, the negotiations could of easily been carried out without the strike. At first I was a skeptic but now I'm almost positive that this was done to divert attention from the UAW corruption cases.
 
#104 ·
I think we are going to see some interesting product production decisions within the next 4 years. I thought it might of been interesting if GM reinstated their development of their small GMC BOF SUV to compete with the Bronco and Wrangler. Could be built in the US, make some money, fill a product hole, and possibly appease the UAW on their USA building demand. I am pretty sure of one thing though. The UAW shunned the development of electric vehicles and I think GM is going to now build all those facilities outside the USA.
 
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#106 ·
Man, they picked a bad time to strike.
Management here just announced a number of rather drastic measures that indicate a major economic downturn.

Batten down the hatches folks... it's about to get bumpy!
 
#112 ·
GM, UAW likely to reach tentative deal Wednesday, report says
October 14, 2019 07:34 PM UPDATED 5 HOURS AGO
https://www.autonews.com/manufacturing/gm-uaw-likely-reach-tentative-deal-wednesday-report-says

DETROIT — General Motors and the UAW are likely to announce a
tentative contract agreement on Wednesday that could soon end
the union’s monthlong strike, Reuters reported, citing sources
briefed on the negotiations.

The report said the two sides were nearing a deal Tuesday and
“have agreed to terms on most issues but were finalizing the
wording on some matters.”
GM CEO Mary Barra and President
Mark Reuss joined the talks Tuesday, signaling that a deal
could be close.

The UAW has summoned leaders from plants around the country to
Detroit for a Thursday meeting regarding a “contract update” and
other yet-to-be-determined agenda items.

GM declined to comment on the potential for an agreement and
on its top executives' involvement in bargaining.

“Talks continue,” a company spokesman said. Tuesday marks the
30th day of the union’s nationwide strike against GM.

The UAW’s Thursday council meeting, which it announced Monday
evening, would offer the union’s leaders a chance to provide a
face-to-face update on negotiations or to recommend presenting
a tentative agreement to rank-and-file members for ratification.
 
#114 · (Edited)
Would be nice if it turns out accurate. I have heard other reports citing UAW heads giving GM "one last chance" and then suggesting changing targets while keeping GM workers on strike. I wouldn't think that the UAW would do this but given everything else they have said I wouldn't put it past them.
 
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