Quote Originally Posted by maladroit
the senate republicans demanded further wage reductions to put them at wage parity with japanese and european automakers (an impossible demand to meet on short notice)...
If they are to fall into chapter 11 bankruptcy, those wage contracts will be nullified anyway. The UAW decided not to renegotiate their current labor contract, where the act of doing so is not impossible.

the republicans wanted a specific date when that would happen so the UAW replied with the expiration date of their current contract in 2011
When told this is a no go, UAW refused to compromise. ...after the bill was killed, the UAW president gave a long press conference that sounded similar to our earlier discussion comparing toyota to detroit...i think he said something to the effect that if unions were expected to make wage concessions, then the legislators should demand that management and suppliers make concessions too...it wasn't the unions fault that detroit made the wrong kind of vehicles of lower quality, and now they're being scapegoated for the republican opposition to bailing out the automakers
As Ron Gettelfinger squabbles about fairness, millions of UAW members slide closer to unemployment... It seems that what is important to Gettelfinger conflicts with his constituencies best interests.

GM's total market capital is only $2 billion...it's gonna be hard to get that bailout money back if the GM doesn't start selling cars real soon
Nobody is selling cars like its 2004, the behavior of the consumer is in hoard phase.
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Dr Peter Morici: UAW - GM Pact leaves GM at Cost Disadvantage
By Professor Peter Morici, Robert H. Smith School of Business, University of Maryland
Sep 26, 2007, 15:26

The details that emerged in the press today about the â??historicâ?ť UAW - GM labor pact indicate the deal may prove the death knell for yet many more Midwestern manufacturing jobs.

Although, GM, by funding an independent trust, has managed to move retiree health care costs off the books, the residual liability remains unclear. As with the Delphi spin off, if GM must step in when the health care trust runs out of cash, this may prove nothing more than a bookkeeping rouse. Otherwise, Mr. Gettelfinger has set up his successor to deliver the bad news to GM retirees, that there is just not enough money to meet their expectations. The actual outcome will like lie between those two extremes.

That aside, much of GMâ??s labor cost disadvantage lies in the wages and fringe benefits it pays workers making cars today--those are not legacy costs. The pact does not much reduce the premium GM pays over Toyota, except only new hires. Temporary workers will be upgraded to the existing pay structure, and according to the Detroit Free Press, only those new hires that are not directly involved in the production of vehicles will be offered the new, lower pay scale.

Toyota already has the ability to differentiate pay among production workers and those that mow the lawn, and the fundamental cost disadvantage imposed by GMâ??s high scale for workers on the line remains. The pact does not call for new pay raises but it does provide for significant bonuses in the out years of the contract; hence, the pact raises pay but GM and the UAW hope investors wonâ??t notice.

Lost in all the coverage has been the fact that legacy costs are only part of GMâ??s problem. This pact does a lot to reduce legacy costs but not enough to eliminate the actual costs GM faces making vehicles today.
Other disadvantages will also continue to apply. For example, the agreement constrains GM investments, such as commitments to make certain products in the United States, that Toyota and other Asians do not face. The same goes for burdensome work rules and limits on locating and selecting suppliers to maximize supply chain efficiency.
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