SRR: The demise of the auto industry....


I live with wind knots
Just to think that if one of them had the marketing sense to fly in in a public jet, he'd be raking in big bucks right now. but U guess that is why they are in the situation they are in now. Always going the wrong direction.

Ed Call

Well-Known Member
Just to think that if one of them had the marketing sense to fly in in a public jet, he'd be raking in big bucks right now. but U guess that is why they are in the situation they are in now. Always going the wrong direction.
This got me thinking, what is congress thinking anyway. Everyone is feeling the pinch, it is time to embrace technology and conduct some video teleconferencing. No private jets, no commercial jets, hell no one even needs to put their pants on, just sit with a camera in your face, answer the questions and plead for assistance. Lots of companies and government agencies are embracing the technology, why not our "leadership". If they think they are so important to be able to direct everyone to fly to them they should think they are so important to influence better choice making.
Some body needs to confront the myth that auto workers make 75.oo per hour. IT IS NOT TRUE!!!
Because of old pension and medical insurance issues for retirees GM has to figure its labor force costs them around 75.00 per hour. The new funding of the old retirement and medical plans is nearly done and a trust is set up to pay them. The average amount going to wages and benefits will reduce to $50. per hour in late 2009 or early 2010. Toyota motor currently figures 47. per hour for it average. New hires at the big three are making under 15. per hour the same as Toyota and Honda. The union has made huge concessions in the last ten years.
GM is making progress the labor force in the last decade has gone from 180,000 to 93,000 plants have closed all over. The union had to agree to these closures.
There is a lot of blame to go around but we need to work with facts not the myths that surround this debacle. Auto workers do not make $150.000 per year it is just simply not true.
The costs of a worker to an employer is not what he is taking home on his check. I am a PM at a union construction company a Carpenter here make $25.01 per hour and they will average about 1700-1800 hours per year. No vacation pay, no sick pay, no personal days so they make about $45,000. per year BUT when I figure the labor on a project I have to add 67% to that number to cover insurance, pension. state and federal taxes. This worker now has a "wage" of 42.00 per hour. This does not figure in any overhead and profit. So when I tell a client that my workman is going to cost him $$55. to 60. per hour he says wow I did not know that carpenters MADE 60.00 PER HOUR!!![/B]:beathead::beathead:When you are trying to spin this auto crisis the union worker will often come out the bad guy.
The union has cetainly been too strong and has contributed to this problem in the past but those days are over for all unions. Busting the union will not help the economy or this nation.
I think they need to get the CEO's of the big three and the head of the UAW in the room with the new Treasury Secretary and the President Elect and not let them out until a new business plan is approved. If all three come out great if there is only two left and a merger is in the works that works for me too.
I am all for bad businesses being acccountable but I don't think that allowing any of these three manufacturers to go bankrupt is an option.
Just my 4 cents worth (that the union wage:rofl:)
jesse clark

I think your spinning your math on the carpenter pay as well. You say they make 25 bucks an hour. In fact they make 42 bucks an hour. In non union work hourly wage is quoted in pre tax, pre medical, pre pension....pre everything. My point is that when you see other pay in non union jobs for comparison its not take home pay.
Also, my problem with the pay for the auto workers is that it is way to high from a relative standpoint. Working on a manufacturing line for the big 3 is no different that working on the line at Mcdonalds. It should be paid the same except the government has decided to subsidize this industry to make a fake middle class in the midwest. I don't think its fair. Why the auto workers in detroit. Why not allow workers at Mcdonalds instead to make 50 bucks an hour and we the tax payers subsidize Mcdonalds instead. At least that would benefit people in all states just not one region. Also, my point about auto workers making the same wage as Mcdonalds is not a slight on labor wages. I have no problem paying technical labor like carpenters and welders 50-100 bucks an hour. That is a technical job that I can't do that requires alot of skill and physical ability. Not so working a line at an auto plant...well no more or no less than at Mcdonalds anyway.
Also my final point. The auto industry in the USA is not a closed system. If the big 3 fail, 1 or 2 or all 3 will start again but more healthy. Point being that we will not lose all of those jobs. Its foolish to think that if they fail we won't have any cars to buy.

Kent Lufkin

Remember when you could remember everything?
I saw George Stephano-whateverthehellhislastnameis-opoulis on the ABC national news tonight who anchored a story about the Detroit auto industry. This is a quote: "...where the average worker earns $73/hour including benefits."

We can argue over exactly what 'including benefits' means or not, but the fact remains that those guys are making a hell of a lot of money making cars.

Jobs aren't an entitlement just because you've always had one or you've always made that much.


Kent Lufkin

Remember when you could remember everything?
So is this a good time to buy an American Pickup or not?
I talked with a friend and client this morning who is looking to trade in his 5-YO F-150 on a new pickup. His head says to buy a Toyota but his wallet says to buy American. He's conflicted because the Toyota dealers don't offer as much wiggle room.

Want it cheap? Buy domestic. Want resale value? Buy Toyota.

I haven't looked at Toyota trucks here but I do have experience with Toyota vehicles other places around the World. I have found them to be tough and reliable but poor on fuel economy and poor on hauling ability.

Just rather buy American.


Active Member
Kent, Your comment about trade-ins and resale value opens up another whole line of discussion. When you buy a vehicle based entirely on it's resale value or buy a house using the same criteria you likely won't realize that value unless you trade up frequently. From what I have observed over the years most folks that do that are in the mode of making perpetual payments. That means perpetual credit-the same boogeyman that is causing so much grief around the world right now. It may sound simplistic but if you are operating on a cash and carry basis you are in much better position to deal with the current recession and it's after effects.

Trading in an almost new vehicle every few years has almost become an American tradition and in almost every instance that trade works to the advantage of the dealer and to the detriment of the consumer. A look at any buying guide that shows the trade in value of your vehicle compared to the private party value will illustrate that point.

In my case I bought my first car in 1954 and in the ensuing 54 years have never traded a car in. This has saved me thousands of dollars that were better used elsewhere. Like saving them for early retirement for instance. Two of my current vehicles total 31 years of age and have over 300,000 miles on them and still look good and drive well. Excluding tires I have spent less than $3,000 on combined maintenance on them over the years or an average of about $100 a year. Compare that to just the tax alone on a new pickup and it is clear that my combined expenses even with oil and filters, is just mouse nuts. Anybody can do the same, few want to.

In your friends case were I to advise him I would suggest that he take advantage of the incredible price savings on a domestic truck and just do the math. Some are offering over $7,000 in price breaks for pickups that are still the finest in the world. No matter what the resale value is at the end of the vehicles life the differences in resale will never come close to the 7K that you saved up front. Put another way that 7K will buy 1750 gallons of gas at $4/gal or 2300 gallons at $3/gal. Assuming 15mpg that means the first 26,000 or 35,000 miles are essentially free. I would find it difficult to turn my back to a cash gift of that magnitude but then I am a frugal guy with no debt. Individual results may vary.



Purveyor of fine hackle, wine & cigars!
Ive, I respect your opinion, but disagree with the premise that we need to save the Big Three. Kent has summed it up pretty well...

I don't buy many vehicles, I currently have a 2000 Toyota Tacoma 4x4 w/ over 130,000 miles on it and plan to drive it for a long time to come. I may eventually buy a second car, but for now will enjoy my paid off vehicle and pay down other debt and save some $$.

I know that people may lose their jobs and feel for them as individuals, but just don't think we need to spend more money that our country can't afford, especially while we're fighting in two places half way around the world. I feel for each of them, but I myself have gone through it numerous time (4 times) and come out stronger on the end. If we are going to spend money, let's retrain the workers that are willing to be retrained.

Last, here's Jon Stewarts perspective on it.. There is truth in comedy and ironcally I feel that he covers some of these events much better than the mainstream media! Just my opinion of course.

<style type='text/css'>.cc_box a:hover .cc_home{background:url('') !important;}.cc_links a{color:#b9b9b9;text-decoration:none;}.cc_show a{color:#707070;text-decoration:none;}.cc_title a{color:#868686;text-decoration:none;}.cc_links a:hover{color:#67bee2;text-decoration:underline;}</style><div class='cc_box' style='position:relative'><a href='' target='_blank' style='display:inline; float:left; width:60px; height:31px;'><div class='cc_home' style='float:left; border:solid 1px #cfcfcf; border-width:1px 0px 0px 1px; width:60px; height:31px; background:url("");'></div></a><div style='font:bold 10px Arial,Helvetica,Verdana,sans-serif; float:left; width:299px; height:31px; border:solid 1px #cfcfcf; border-width:1px 1px 0px 0px; overflow:hidden; color:#707070;'><div class='cc_show' style='position:relative; background-color:#e5e5e5;padding-left:3px; height:14px; padding-top:2px; overflow:hidden;'><a href='' target='_blank'>The Daily Show With Jon Stewart</a><span style='position:absolute; top:2px; right:3px;'>M - Th 11p / 10c</span></div><div class='cc_title' style='font-size:11px; color:#868686; background-color:#f5f5f5; padding:3px; padding-top:1px; line-height:14px; height:21px; overflow:hidden;'><a href='' target='_blank'>Clusterf#@k to the Poor House - Dude, Where's My Car Industry?</a></div></div><embed style='float:left; clear:left;' src='' width='360' height='301' type='application/x-shockwave-flash' wmode='window' allowFullscreen='true' flashvars='autoPlay=false' allowscriptaccess='always' allownetworking='all' bgcolor='#000000'></embed><div class='cc_links' style='float:left; clear:left; width:358px; border:solid 1px #cfcfcf; border-top:0px; font:10px Arial,Helvetica,Verdana,sans-serif; color:#b9b9b9; background-color:#f5f5f5;'><div style='width:177px; float:left; padding-left:3px;'><a target='_blank' href=''>Barack Obama Interview</a><br /><a target='_blank' href=''>John McCain Interview</a></div><div style='width:177px; float:left;'><a target='_blank' href=''>Sarah Palin Video</a><br /><a target='_blank' href=''>Funny Election Video</a></div><div style='clear:both'></div></div><div style='clear:both'></div></div>

Now I'm off to the river to practice my casting and swing a fly or two.

Bill :cool:


Active Member
i appreciate the down to earth explaination of the difference between take home pay and a benefit package. when folks start throwing numbers around, they should be a bit more concerned for accuracy than 'shock and awe' value. we always defined costs to business that were outside of actual wages as 'overhead'.

now i would not argue that the B3 overhead is probably out of line with the rest of the auto industry, but in actual numbers, its not that far off from toyota or honda USA.

so what is going on here?? products that no one seems to want to purchase, pretty straight forward. i can remember my first honda. there were no options lists, everything was already included. what that means is a single production line where every 'feature' was already incorporated. simplicity in production allowed the asian mfg's to overtake the B3 by streamlining their production.

this is industrial engineering at work and it has sunk the B3 who simply can't shake an old style way of doing business in today's market place.

so please, when you start to slam the workers, understand that just like you, they wanted a living wage and a benefit package. any of you who have recently been offered a bonus, wage increase, or an enhanced benefit package who stepped up and said 'no thanks', let all of us know about your generosity and concern for mankind!

Why is it us old guys that have it figured out? :ray1:

This whole deal with the housing crisis, two jobs per family to make ends meet, payments on credit cards and automobiles so people can have the newest and the best is so stupid.

I'm 60 years old and have never made a car payment. I have paid cash for every vehicle I have ever personally owned. I have never had a credit card balance that was over due. I raised 4 kids through college and my wife never had to work, although she went back to teaching when our youngest daughter reached Jr. High.

I knew my parents had worked all their lives for the house I grew up in and didn't expect to have one as good or better when I graduated from College. We started out in a single wide with a B&W TV and worked up.

I may not be stylish or have a new BMW but I retired at 55 and have spend the time watching and enjoying my Children and Grandchildren growing up.

A good friend is the Sales Manager at one of the local BMW Dealers. He tells me that more than half of the new Beamers sold are leased. That means that over half of the people driving newer BMWs really can't afford to own one. Probably the same with Mercedes.

How stupid is renting a car. :beathead:

Save your money until you can afford to buy something instead of putting it on credit. I have actually met people that were taking vacations on their Credit Card and were going to pay for the vacation down the line. :eek:

How stupid is that? :beathead:

Jim Wallace

Smells like low tide.
:rofl::rofl::rofl::rofl: Thanks for that flybill! That was not only funny, but spot on!

Still driving the beater 1988 Mazda B-2200 p/u with nearly 219,000miles on it that I paid cash for in Dec 1996. Bought it used from the original owner in great condition for only $4,000 with 96,700 on the odometer, and full service records.
I have beat the hell out this truck, driven it hard, backed it into trees in the dark, been backed into by little old ladies in the post office parking lot, valves have been clicking for the last 120,000m and burns a little oil now, but still running like a champ.
I have also subjected it to beach living for the last 12 years, often drive it on the beach, never wash or wax it, and the finish is only starting to show the neglect. I can't seem to kill it.
This truck was made in Japan before Ford took over Mazda production.

But I'm looking for a newer rig.


Active Member
I haven't looked at Toyota trucks here but I do have experience with Toyota vehicles other places around the World. I have found them to be tough and reliable but poor on fuel economy and poor on hauling ability.

Just rather buy American.
I'd agree with that statement as well. I've got a 97 F-250 that tows just about anything I put behind it. Gas mileage sucks, but I knew that when I bought it. The only caveat to all this is: it's only a matter of time before Toyota finds a solution to the problem.