My assertion: Manufacturing in MI will not recover unless right to work is passet

[halik]

Can someone prove me wrong?

Michigan is competing with southern states like KY and AL and manufacturing won't voluntarily return to the state so long our wages are inflated and productivity lower compared to non-union states.

 

[Strk]

What do union rules have to do with MI not being a good place for businesses in general (not just manufacturing)?

 

[daveshel]

You are correct. The UAW is killing the big 3. We didn't learn our lesson when we lost the steel industry a few years back.

 

[halik]

Originally posted by: Strk
What do union rules have to do with MI not being a good place for businesses in general (not just manufacturing)?

Forced unionization means comparative disadvantage compared to southern states - that's why no one is opening new plants in michigan.

Why would MI be inherently bad place for business?

 

[StageLeft]

I presume also taxes. It's a key reason why NY state's population is flat. Why would a business setup shop here when they can go a few hundred miles south and not get gang-banged by all the taxes here?

 

[StageLeft]

Why would MI be inherently bad place for business?

Wouldn't be. I see some say that people hate the weather up north but that's BS. People follow work and if they live somewhere they like to stay, because of family. It's the corporate climate and nothing else.

 

[TraumaRN]

Originally posted by: Skoorb

Why would MI be inherently bad place for business?

Wouldn't be. I see some say that people hate the weather up north but that's BS. People follow work and if they live somewhere they like to stay, because of family. It's the corporate climate and nothing else.

Well thats certainly true in the city of Detroit proper. There is a good reason why businesses don't invest there. Tis expensive. Detroit is one of only 3 cities in Michigan that levies a city tax on employee/ers.

I know this unfortunately because I work in Detroit proper, on a $2,600 paycheck its about $27 dollars. It's not much but it's there. And it sucks at times, especially at the end of the year and I see I paid the city of Detroit $700-800 dollars

 

[dphantom]

I would tend to agree with the OPs assertion. Right to work would most likely depress wages, but long term would bring auto and other manufacturing costs in MI back in line with the competition. Toyota, Honda and otehrs are eating us alive in per vehicle costs.

Direct labor is not the only factor though. A major reason why the Big 3 are non-competitive is all the legacy retirement and health costs that are not going away. The cars being made now are as good as any in the world, but the overhead is killing the Big 3.

 

[Rainsford]

Originally posted by: dphantom
I would tend to agree with the OPs assertion. Right to work would most likely depress wages, but long term would bring auto and other manufacturing costs in MI back in line with the competition. Toyota, Honda and otehrs are eating us alive in per vehicle costs.

Direct labor is not the only factor though. A major reason why the Big 3 are non-competitive is all the legacy retirement and health costs that are not going away. The cars being made now are as good as any in the world, but the overhead is killing the Big 3.

That's right, always blame the labor :roll:

I won't disagree that higher labor costs (and legacy costs) are hurting the big 3, but Japanese and German manufacturers somehow are still successful without treating their employees like complete shit. And part of the reason is that, while it's a factor, labor is not the ONLY problem facing the big 3. I know it's somehow become pro-capitalism to always blame labor and never blame the business itself, but the big 3 have NOT been turning out competitive vehicles lately. For one thing, they gambled huge on the SUV craze, even when it was clear the trend of ridiculous vehicles was ending...and they are STILL trying to sell SUVs and pickup trucks as their main product. Sure, they sell cars, but it seems almost like an afterthought than a real product line. They're slowly coming around now, but they're a little late to the game, especially since other manufacturers have been following a different strategy for years.

The real issue, if you ask me, is that rather than trying to make cars consumers want, they're main business has now become blaming the UAW and asking for government handouts.

 

[dphantom]

Originally posted by: Rainsford

Originally posted by: dphantom
I would tend to agree with the OPs assertion. Right to work would most likely depress wages, but long term would bring auto and other manufacturing costs in MI back in line with the competition. Toyota, Honda and otehrs are eating us alive in per vehicle costs.

Direct labor is not the only factor though. A major reason why the Big 3 are non-competitive is all the legacy retirement and health costs that are not going away. The cars being made now are as good as any in the world, but the overhead is killing the Big 3.

That's right, always blame the labor :roll:

I won't disagree that higher labor costs (and legacy costs) are hurting the big 3, but Japanese and German manufacturers somehow are still successful without treating their employees like complete shit. And part of the reason is that, while it's a factor, labor is not the ONLY problem facing the big 3. I know it's somehow become pro-capitalism to always blame labor and never blame the business itself, but the big 3 have NOT been turning out competitive vehicles lately. For one thing, they gambled huge on the SUV craze, even when it was clear the trend of ridiculous vehicles was ending...and they are STILL trying to sell SUVs and pickup trucks as their main product. Sure, they sell cars, but it seems almost like an afterthought than a real product line. They're slowly coming around now, but they're a little late to the game, especially since other manufacturers have been following a different strategy for years.

The real issue, if you ask me, is that rather than trying to make cars consumers want, they're main business has now become blaming the UAW and asking for government handouts.

I am not blaming anyone including labor. Simply stating a fact.

Big 3 management is as culpable as labor. Mgmt didn't have to sign all those labor agreements but did.

As for turning out SUVs, well, that was what people were buying and that is where the biggest profits are. That is why Nissan, Toyota and others got into the big SUV/puckup game as well.

And GM has very competitive car line. The impala and cobalt are as hot a seller as any other car on the market.

 

[Jaskalas]

Why not use tariffs against foreign vehicles?

 

[yllus]

Originally posted by: Jaskalas
Why not use tariffs against foreign vehicles?

The solution to a company being non-competitive isn't to increase costs on its competitors. All you've done then is reward the non-competitive company for being slow/lazy/inefficient.

 

[RightIsWrong]

Originally posted by: Jaskalas
Why not use tariffs against foreign vehicles?

Because that would hurt the Big 3 more than the 'Imports' which are decidedly more American made.

 

[halik]

Originally posted by: Jaskalas
Why not use tariffs against foreign vehicles?

You mean like honda civic, toyota camry or Mercedes GL?

 

[heyheybooboo]

Originally posted by: Rainsford

Originally posted by: dphantom
I would tend to agree with the OPs assertion. Right to work would most likely depress wages, but long term would bring auto and other manufacturing costs in MI back in line with the competition. Toyota, Honda and otehrs are eating us alive in per vehicle costs.

Direct labor is not the only factor though. A major reason why the Big 3 are non-competitive is all the legacy retirement and health costs that are not going away. The cars being made now are as good as any in the world, but the overhead is killing the Big 3.

That's right, always blame the labor :roll:

I won't disagree that higher labor costs (and legacy costs) are hurting the big 3, but Japanese and German manufacturers somehow are still successful without treating their employees like complete shit. And part of the reason is that, while it's a factor, labor is not the ONLY problem facing the big 3. I know it's somehow become pro-capitalism to always blame labor and never blame the business itself, but the big 3 have NOT been turning out competitive vehicles lately. For one thing, they gambled huge on the SUV craze, even when it was clear the trend of ridiculous vehicles was ending...and they are STILL trying to sell SUVs and pickup trucks as their main product. Sure, they sell cars, but it seems almost like an afterthought than a real product line. They're slowly coming around now, but they're a little late to the game, especially since other manufacturers have been following a different strategy for years.

The real issue, if you ask me, is that rather than trying to make cars consumers want, they're main business has now become blaming the UAW and asking for government handouts.

Alot of this ...

Generous Motors has always been about profit, not market share. Their highest margins are on SUVs, trucks and vans. Labor costs have been reduced as more robotics have been introduced. IIRC their 'legacy' costs add around $1,400 per vehicle.

So when you combine their legacy costs, declining market share on cars and a major drop in sales for SUVs and trucks, they are screwed.

They pay around $35/hr for labor - when you add in benefits and taxes it comes out to around $75/hr.

As far as Michigan is concerned they have a skilled workforce - they are just 'skilled' in the wrong trades. As noted in the Rethug primary, auto jobs are gone and they are not coming back. A quick comparison reveals 28 'community colleges' serving a population in excess of 10 million. In North Carolina we have 59 community colleges serving a population of 8 million (and many 'extended' campuses into both rural and urban areas). Michigan needs to continue and improve job retraining and diversify their industrial base

The cost of operation is also a major consideration. When a Michigan industry has to pay 55% more for electricity than they do in Kentucky (plus the additional 'heating' days) it's hard to be competitive.

One issue that has now come to the forefront in North Carolina (we've had our own problems with the loss of manufacturing jobs) is that the new skilled 'technical' jobs that have been created are being 'flipped' much faster to China and India. Good 'technical' or trade jobs that were available as short as 6-7 years ago are flying overseas to China (and 'cheap' labor jobs are moving to Vietnam and South America).

 

[halik]

Originally posted by: Rainsford

Originally posted by: dphantom
I would tend to agree with the OPs assertion. Right to work would most likely depress wages, but long term would bring auto and other manufacturing costs in MI back in line with the competition. Toyota, Honda and otehrs are eating us alive in per vehicle costs.

Direct labor is not the only factor though. A major reason why the Big 3 are non-competitive is all the legacy retirement and health costs that are not going away. The cars being made now are as good as any in the world, but the overhead is killing the Big 3.

That's right, always blame the labor :roll:

I won't disagree that higher labor costs (and legacy costs) are hurting the big 3, but Japanese and German manufacturers somehow are still successful without treating their employees like complete shit. And part of the reason is that, while it's a factor, labor is not the ONLY problem facing the big 3. I know it's somehow become pro-capitalism to always blame labor and never blame the business itself, but the big 3 have NOT been turning out competitive vehicles lately. For one thing, they gambled huge on the SUV craze, even when it was clear the trend of ridiculous vehicles was ending...and they are STILL trying to sell SUVs and pickup trucks as their main product. Sure, they sell cars, but it seems almost like an afterthought than a real product line. They're slowly coming around now, but they're a little late to the game, especially since other manufacturers have been following a different strategy for years.

The real issue, if you ask me, is that rather than trying to make cars consumers want, they're main business has now become blaming the UAW and asking for government handouts.

SUVs have huge margins, small cars have tiny margins. If you're paying more than double for labor, you cannot make money selling small cars.

 

[ElFenix]

Originally posted by: RightIsWrong

Originally posted by: Jaskalas
Why not use tariffs against foreign vehicles?

Because that would hurt the Big 3 more than the 'Imports' which are decidedly more American made.

no they are not.

Still, it's hard to deny that among the most popular U.S.-built cars and trucks, the models with the highest domestic content ratings come from Detroit automakers. Of the 35 most popular U.S.-built 2008 and 2009 models ? based on sales through May 31, 2008 ? 43 percent of GM, Ford and Chrysler contenders had domestic content ratings of 75 percent or higher. In comparison, just 25 percent of the Nissan, Honda, Hyundai and Toyota models on the list achieved that.

http://www.cars.com/go/advice/...mMadeParts&subject=ami

 

[Vette73]

Originally posted by: halik

Originally posted by: Rainsford

Originally posted by: dphantom
I would tend to agree with the OPs assertion. Right to work would most likely depress wages, but long term would bring auto and other manufacturing costs in MI back in line with the competition. Toyota, Honda and otehrs are eating us alive in per vehicle costs.

Direct labor is not the only factor though. A major reason why the Big 3 are non-competitive is all the legacy retirement and health costs that are not going away. The cars being made now are as good as any in the world, but the overhead is killing the Big 3.

That's right, always blame the labor :roll:

I won't disagree that higher labor costs (and legacy costs) are hurting the big 3, but Japanese and German manufacturers somehow are still successful without treating their employees like complete shit. And part of the reason is that, while it's a factor, labor is not the ONLY problem facing the big 3. I know it's somehow become pro-capitalism to always blame labor and never blame the business itself, but the big 3 have NOT been turning out competitive vehicles lately. For one thing, they gambled huge on the SUV craze, even when it was clear the trend of ridiculous vehicles was ending...and they are STILL trying to sell SUVs and pickup trucks as their main product. Sure, they sell cars, but it seems almost like an afterthought than a real product line. They're slowly coming around now, but they're a little late to the game, especially since other manufacturers have been following a different strategy for years.

The real issue, if you ask me, is that rather than trying to make cars consumers want, they're main business has now become blaming the UAW and asking for government handouts.

SUVs have huge margins, small cars have tiny margins. If you're paying more than double for labor, you cannot make money selling small cars.

And agins Toyota with its bonus system pays its people more then GM pays its people many times.

 

[Jaskalas]

Originally posted by: yllus

Originally posted by: Jaskalas
Why not use tariffs against foreign vehicles?

The solution to a company being non-competitive isn't to increase costs on its competitors. All you've done then is reward the non-competitive company for being slow/lazy/inefficient.

If you cannot equalize the cost of the wages on the final product, then the company spending the least amount of money on wages/bonuses/whatever is going to win, and the other companies will go out of business.

It?s the Wal-Mart effect.

 

[rudder]

Toyota is building a new plant in Mississippi and Volkswagen is building a new plant in Tennessee. Why do you suppose those companies decided to build in the south rather than in an area like MI that has a good number of experienced auto workers?

Of course there were tax incentives, but overall costs for these companies will be less.

Employees at the Nissan manufacturing plant in Smyrna, TN have repeatedly rejected joining the UAW.

 

[IHateMyJob2004]

Originally posted by: yllus

Originally posted by: Jaskalas
Why not use tariffs against foreign vehicles?

The solution to a company being non-competitive isn't to increase costs on its competitors. All you've done then is reward the non-competitive company for being slow/lazy/inefficient.

Or rewarding the companies that do less for their employees in terms of retirement plans and heath care .... how about hours worked each week? Should 60 hour work weeks be the norm?

 

[halik]

Originally posted by: rudder
Toyota is building a new plant in Mississippi and Volkswagen is building a new plant in Tennessee. Why do you suppose those companies decided to build in the south rather than in an area like MI that has a good number of experienced auto workers?

Of course there were tax incentives, but overall costs for these companies will be less.

Employees at the Nissan manufacturing plant in Smyrna, TN have repeatedly rejected joining the UAW.

I wonder why...

 

[boomerang]

Right to work is a non-issue. The likelihood of the bridge loans going through is getting smaller by the minute. I know the rest of the country doesn't believe it, but when the domestics go under, they're not coming back - anywhere. You can't keep ignoring the facts.

Once manufacturing is dead in Michigan, the UAW will virtually cease to exist. Our business climate is hostile to business. Manufacturing will not return because our leaders will hopefully have learned that it's not the type of business we need in this state. We'll have an additional decade of pure misery on top of the 6 to 8 years of hell we've been going through. U.S.-based companies have 105 assembly and component plants in 20 states, including California, Texas, Louisiana and Maryland so there's going to be ample misery to spread around.

The UAW will be effectively castrated. It should make many of you very, very happy.

Then the race to the bottom will intensify. With the specter of unionization effectively eliminated, employers across the nation, pressured by wall street and stockholders, will begin to whittle away at pay and benefits. There's always someone in the world willing to do it cheaper.

Most importantly you union bashers are going to have to find another whipping boy.

The Dem's hold the cards, right to work is only a dream at this point.

 

[miketheidiot]

Originally posted by: halik

Originally posted by: Strk
What do union rules have to do with MI not being a good place for businesses in general (not just manufacturing)?

Forced unionization means comparative disadvantage compared to southern states - that's why no one is opening new plants in michigan.

Why would MI be inherently bad place for business?

southern states are also subsidizing those factories.

 

[Genx87]

Originally posted by: boomerang
Right to work is a non-issue. The likelihood of the bridge loans going through is getting smaller by the minute. I know the rest of the country doesn't believe it, but when the domestics go under, they're not coming back - anywhere. You can't keep ignoring the facts.

Once manufacturing is dead in Michigan, the UAW will virtually cease to exist. Our business climate is hostile to business. Manufacturing will not return because our leaders will hopefully have learned that it's not the type of business we need in this state. We'll have an additional decade of pure misery on top of the 6 to 8 years of hell we've been going through. U.S.-based companies have 105 assembly and component plants in 20 states, including California, Texas, Louisiana and Maryland so there's going to be ample misery to spread around.

The UAW will be effectively castrated. It should make many of you very, very happy.

Then the race to the bottom will intensify. With the specter of unionization effectively eliminated, employers across the nation, pressured by wall street and stockholders, will begin to whittle away at pay and benefits. There's always someone in the world willing to do it cheaper.

Most importantly you union bashers are going to have to find another whipping boy.

The Dem's hold the cards, right to work is only a dream at this point.

From what I can tell the race to the bottom starts in Union mandated Michigan. So excuse me while your fear mongering falls on deaf ears.

The rest of your post is amusing considering about 8% of non-govt workers are unionized. Why havent the other 92% of workers been raked over the coals yet? Think that last 8% is holding up the show or something?