GM to cut 25000 jobs

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Looks like GM has accepted the beginning of the end for the mass producer of junk cars. Ford is next.

Reply to
David Cole
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I would argue that GMs problem is a result of foreign manufacturers working under different rules. GMs has to spend millions (billions) to fund generous health benefits and pensions for retired workers. Saddle Toyota with these same liabilities and let's see how smart they would be.

GM has some good products and some bad products - just like Toyota. Despite Toyota's tremendous cost advantages, they still build some real turkeys. I would argue that the only really interesting Toyota product is the Prius, and they had to buy Aisian Warner to secure the "Toyota" technology that make it interesting. And before you try to claim a tremendous quality advantage for Toyota, check out the latest JD Power ratings (for what they are worth). Personally, I was very disappointed in the "quality" of Tundras when I was truck shopping. I could see no obvious advantage for the Tundra despite a higher price than similarly equipped trucks from Ford or Chevy.

Ed

Reply to
C. E. White

Hey, GM agreed to all those health and pension benefits. Now all the US manufacturers would like to find a way to socialize all the cost to the public after the fact. I hope they fail in the attempt. The simple fact is that if GM, Ford, and DC were building what people wanted they would not be losing market share. The "old farts" will continue to buy Crown Vics and Suburbans, thus keeping the slide gradual enough for the economy to survive the market share erosion.

Reply to
Al Bundy

Hehehe, Japan is one of the many modern countries that offers socialized medicine to all its citizens. The car makers over there pay more in taxes, as do the workers, for that benefit. American companies would rather put that money into their CEOs pockets instead. Net result? Japanese workers have better benefits, better access to health care, and produce better cars for less money. GM's biggest problem is that they bet the farm on gas sucking SUVs like the Hummer and now that's come back to haunt them. They had an EV program with people lined up around the block to buy them at any price, with projected price being in the mid-20's.

They abandoned that program. GM never spent much actual real effort to develop a series of good hybrids. Honda and Toyota did. Well, people are buying Hondas and Toyotas, there's a waiting list, and nobody's buying GM's wonderful lineup of

1990's technology.

GM's CEOs are responsible for this mess through bad decisions and no ability to predect short term trends, much less than long term trends. They will pocket hundreds of millions of dollars in pay and bonuses for this lack of vision and piss-poor leadership and performance. Then they have the audacity to blame the workers?

Typical.

BTW, most of the import companies have plants in this country that make "import" cars on American soil. The workers in these plants have excellent benefits including health and pension. So much for the "different rules" theory...

JazzMan

Reply to
JazzMan

I have had 9 GM. All were the mechanics friend, cost a bunch to have them. Have had 6 Fords. Small problems on them. Have 2 Fords yet. 1971 and 1992. But now have gone to Japanese, this one was assembled in Japan will wait and see outcome.

Reply to
Warren Weber

Actually it's a bit more than that, it's a functional symptom of corporate America.

Most American companies today spurn mass-production. They do not want to sell ten million wigits for $10 each to make $100 million in sales. Instead they want to sell 100 wigits at a million dollars each. Why - because the sales channel knows that the higher the unit cost the less work they have to do to make the same money. So you get a bunch of sales people who spend all their time chasing those few customers that are willing to drop $30K into a vehicle purchase, and ignore the people only willing to drop $10K into a vehicle purchase.

And, everyone else in the auto industry plays along because they all have vested interests as well. More expensive cars mean more chance they are going to be financed, so the banks all love that. It also means over the car's lifespan that it's book value will be higher so the owner is much more likely to carry comprehensive insurance so the insurance companies love that. It means the sales tax on the car is higher so the governments love that. And I could go on and on. In short, everyone in the industry benefits except the consumer who wants a cheap car.

This is why GM killed the EV program. Look - who would be the biggest customers of EV's? Why would someone want to buy an EV? It is because they want to save money - they want to get out from under Big Oil's thumb and just plug their car into the power grid at night, they aren't driving much since EV's aren't practical out in the toolebushes. They most definitely aren't the people willing to drop $30K into a Hummer or a Corvette.

Ted

Reply to
Ted Mittelstaedt

This is true, but you are ignoring the fact that US laws allowed a monolithic labor organization the means of forcing GM to accept work rules and provide pay and benefits that are now making GM non-competitive. 30 years ago, the UAW could (and did) shutdown targeted manufacturers to extort generous wages and benefits. It is easy to say "GM agreed to all those health and pension benefits" but the fact is, they had little choice. The government is as much responsible for those generous benefits as GM management is.

New product development costs money. If you are struggling to keep your head above water, it is hard to develop new products. However, I don't really see where Toyota (or any other Japanese) manufacturer has excelled in new product development. The only unique Japanese car is the Toyota Prius, and Toyota bought the technology from a supplier (well, they actually bought the supplier). As far as I can see, Toyota is nothing but a monkey see monkey do company. People say GM made a bad decision by concentrating on trucks and SUVs, but hasn't that been Toyota's strategy for the last 10 years? The Toyota car line-up except for the Prius is just a collection of aging designs that were second rate when new. The trucks are even worse. I suppose you could claim the "new" Avalon is really nice, but what makes it nicer than the Buick Park Avenue? I still contend that it you saddled Toyota with the same pension liabilities as GM, Toyota would be on the brink of bankruptcy as well.

And yes, I agree GM executives are over-paid. This seems to be a disease that infects American businesses in general. I personally think we need to change the rules for corporations to make the Boards of Directors more responsible to the stock holders and be less of a good old boy (and girl) networks that grant each other ridiculously high salaries. It make no sense to me that the CEO can essentially pick the people who oversee him (I'd love to be able to hire and fire my boss at will).

Regards,

Ed White

Reply to
C. E. White

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