Posted on 04/20/2005 6:14:25 AM PDT by marylandrepub1
As recently as 1980, GM sold 44.5 percent of the cars bought in the United States. Last year - even with heavy discounting - that was down to 27.3 percent.
This came as GM said it expected to lose $850 million in the first quarter (the actual numbers are due this week), its bond rating plummeted to near junk status and its stock fell to a 10-year low.
Crunch the numbers - particularly the huge health care and pension obligations it agreed to in labor contracts signed during the salad days - and it is hard to imagine how GM survives.
"GM has become essentially a giant health care provider that also makes some cars,"
"It's pretty astounding," he says. "GM only has about 160,000 actual employees, but something like over 1 million people - retirees, retirees' families - are covered under its social umbrella. That's the bind it's gotten itself into."
Even laying workers off doesn't help much. Under their United Auto Workers' contract, laid-off workers get up to 95 percent of their salary for five years.
"The math of General Motors just doesn't make sense," Peter Morici says. "Basically, they sell cars for less than it costs to make them. "If you have high costs, what you do is take it out of the design of your cars," Morici says. "You put in inexpensive interiors. You don't have an adequate inventory of up-to-date engines and transmissions to put in cars. They had to buy Honda V6s to put in the Saturn Vue. "You lower production costs by cutting back on vehicle design," he says. "You try to fool the consumer."
"The union and management seem to be in some sort of compensation pact," he says. "They are slowly dissolving the company to pay themselves."
(Excerpt) Read more at baltimoresun.com ...
I have friend who used to be a (down-state) Del. legislator so I've met one or two of the state politicians. But MD has Mikulski, Elijah Cummings, Kwase M., Glendenning, etc.!
Don't forget - Delaware also has Biden, Carper and Minner (smaller state, less names)
I have many friends in the downstate contingent in Delaware - from both sides of the aisle.........heck, I worked on a few D campaigns over the years.
I have a Chrysler Sebring and no problems have came up.. I have seen a lot of Chryslers on the road lately where before there use to be none..
and change the design of the butt ugly Aztec..
Your premise is based on Walmart's only option of growth as being Supercenters.
Obviously, Walmart would rather expand the number of Supercenters, but if-when-where they run into problems, they can fall back on expanding the smaller non-Supercenter stores and their Neighborhood Markets.
According to Walmart's own stats, for every Supercenter that exists, they can add 3 Neighborhood Markets. They will be a long time building out that scenario.
Our American cars have had some good points but more often than not by the time the warranty starts running out at 3 years 36,000 miles they start needing significant repairs. The quality of our US made cars has also been mixed and we are very impressed that our Hyundai has a level of fit and finish far better than we have grown accustomed to seeing in US cars. The good engineering also shows in a level of comfort that we never experienced in our US cars.
GM, Ford and Chrysler better take a hard look at what the Koreans have accomplished because I serious doubt I will be buying another US car unless they meet this new standard of quality and value.
My first and last car was a Ford Pinto. The initial cost was $4000 and required $8000 in repairs over 9 years. My current car is a Toyoda Corolla. Spending lots of time finding alternate transportation for a car that breaks so American Union Members can get paid for not working does not appeal to me. It's bad enough the fed and MD government forces me to pay for a similar services.
These guys had >25 years to get their acts together but have only grown worse. Bankruptcy would force them to clean house.
To help prevent multiple posts, please do not change headlines.
My point was that while MD is mandating benefits for WALMARTs employees, MD(Baltimore) has a GM plant with the most generous benefits, that is closing. WALMARTs is a successful business model attacked by MD. GM is failed business model that operates as libs in MD state government think all businesses should operate(as MD operates).
MD needs to force all auto plants to have the GM benefits, the way Giants Food got MD to force WALMARTs to up the benefits. Outlaw competition, it worked in the communist countries,
A long time ago I carried North West lumber to the East Coast and steel from the Sparrows Point steel mill back to the West Coast on a ship owned by Bethlehem Steel. Those were the days, US lumber, US steel, US ship with US crew, through the Panama Canal pre Jimmy Carter.
That doesn't solve the pension problem, does it?
You're from Anderson? I live about 20 minutes from there. Small world.
Where are the retirees in the line when the company reforms under bankruptcy protection? Does the company have to desolve? I thought the bondholders were at the top of the list(FNC business.)
The "Union" is just extortion.
What about bankruptcy? A killing of the Golden Goose might provide a wakeup call, but maybe not. In fact I don't even trust republicans (Senate) on this.
Now with technology plants and jobs being exported overseas, the massively shrunken industrial base in America is exacting its toll mercilessly. Workers today are forced to pile into the already over-crowded lower paying service sector, pressuring wages further. Owners of companies in the service sector see their profits squeezed by ever more competition.
In short the economy is seriously out of balance and overweighed in the service sector. When manufacturing and technology were strong in America there was an incredible synergy between all sectors of the economy which feed on itself and produced wide spread prosperity. There were no trade deficits only trade surpluses, people saved, life was good for the vast majority of Americans.
If America wants to remain the world’s superpower in the next century it has only one choice....reindustrialize. And that means junking One Way free trade, in favor managed trade and tariffs. It means going back to the things that used to work in the country and made America into the leading economic power.
You are kidding I hope. Under your idea there would be no incentive to produce anything that works, like in the Communist countries.
Quote: You are kidding I hope. Under your idea there would be no incentive to produce anything that works, like in the Communist countries.
Based upon your philosphy how did we ever put man on the moon and be the worlds leader in just about every hi-tech industry back in 1945-1985 when we have tarrifs of some sort and a huge manufacturing base?? When we were exporting more than importing.. HMMM??
We were not only the leader of every industry but the starters of new industries as well.
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