Quote:
Originally Posted by Dragoneye
I don't believe the money would go to the UAW...it's a loan to the company. It has nothing to do with the union workers.
 You absolutely sure about that? Last time I checked, the workers in a Toyota plant somewhere out west wanted to unionize because Toyota was shafting them all...
They have achieved a competitive contract with the union...everyone here seems to be forgetting the contract signed between the Big three and the UAW last year...(if memory serves) New hires have to start at HALF of what they used to, and GM's bought a real good chunk of the older people (highest paid due to seniority) out into retirement already. Then there was the PRIMARY issue...the REAL issue that caused the UAW to have such a negative effect on GM: HEALTHCARE. Low and behold, that issue will be resolved in 2010, when the UAW takes over the healthcare costs. I agree with you; wait until 2010; and watch GM's losses get less...bad.
Still...I don't understand how the Union is to blame for what's going on right now.  Is this simply a scapegoat to take out fustration of GM's poor outlook on? The fact that they're selling nearly 40% LESS vehicles...and almost all of them are the profitable ones...simply DWARFS any issues they have with the union workers....:( |
You said it, they had to buy out workers to get rid of their ridiculous salaries. Want to take a guess where all their cash went? It costs them money just to downsize. This is a free country, which means any employer should be allowed to hire/fire whenever and whoever they want. If the employee does'nt like it-too bad! Go get another job. Oh wait, most of them can't make anywhere near that somewhere else. People should be paid what they are worth, that is called supply and demand. If they can demand a certain pay by blackmailing the company, eventually that company will not be able to compete. The head of the UAW said labor represents only 8-10% of an automobiles cost now, he is neglecting to mention all the cash GM burned buying out the greedy workers.
The inflexibility of the unions is extremely expensive to GM when they are selling less cars. Look at how Toyota does'nt have cashflow problems, because they can lay people off as demand slumps. As long as business is good, the unions are not the problem. However, when things slow down or the company loses market share, the union contracts are a death sentence.
As for the upper management, it may seem like a lot, but to attract and keep top talent, you have to pay what any other company would pay at that level. Again, it is supply and demand so if you restrict their pay the top talent will just go elsewhere.