Thread: Hmm Dodge...
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Old 01-17-2006, 11:07 PM   #12
BigAls87Z28
 
Join Date: Jul 2004
Location: West Long Branch
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Well, there are protecting American workers, and then there is the issue with the unions.
And Milehigh, you bring up a good point that many import guys bring up, and that is that American companies are firing Americans, and import companies are employing them.
Let me take you back to a time when GM held a damn near monopoly over the US Car market. A time when Chevy alone had more market share then GM does today. GM made many promises to workers when they built many cars in many plants, that GM would cover everything, medical, financial, whatever it was, GM had your back.

Well, its 2006, GM is on the brink of losing #1 spot in the world, and because its so large and has so much weight, it cannot adapt to the auto world around it.
While Toyota can bring a new car out in less then 2 years, it takes GM 3 to 4 years if they work hard at it. Toyota can produce a car much faster then GM can, and the factories are much more flexable as are the chassis and engineering.
GM in recent years has been VASTLY improving its production time. Where it used to take 36 hrs to make a car, it only takes 25. Thats a huge jump, but it takes Toyota 19.
Now, lets put this into perspective. There are 2 plants, plant 1 and plant 2. Both plants make 150k a year, for a total of 300k. Plant 1 improves productivity, and increases its ability to make cars faster. "Lean Manufacturing" is being implimented, and now plant 1 makes 300k cars a year. Problem is, Plant 2 also was upgraded and makes 300k cars a year. Now there is vast overcapacity. What do you do with this other plant?
Well, that gets me to point #2, GM promised these people that they would be coverd for life. Well, that was a great promise back in 1965, but in 2006, GM cant do that. All thoes people who are now getting pension off GM, are sucking a large part of the cash flow away from GM. Health Care is also a big thing. All this amount to about 2,500 added to every car GM makes, right to the bottom line.
Now, union workers wont give up that awesome coverage, and GM suffers. Any profit they make goes right back into paying pension, and hurting GM. GM cannot put money into upcoming cars, which hurts the car itself, coming in below expectation and loosing sales, which takes away more profit, and its a friggin domino effect.
GM has a lot of excess capacity at plants, and thats what kilsl them. They are paying union workesr 95% pay, and full benifits to sit on there asses at home, not building cars.
Toyota and othe Asian car makers, do not have the UAW to deal with. There factories are UAW-Free, and they dont have to deal with healthcare.

People can yell that the US needs a National Healthcare system, like every other major power in the western world, but that aint gunna happen. That could take a lot of stress off GM's back.
GM is making fantastic cars now, and they are gettign better every model. Just look at the new Buick Enclave. I thought Id never say this, but this is one sweet looking Buick.
GM has very few choices, and must make sure that they do what they can to gain as much profit, which is why they are pushing the 900 trucks and SUV's out, and trying to recapture some of that, so that they can infuse it into new models. GM has a lot loaded into the clip, they just need cash, and they need it now. UAW does not seem to be cooperating, and it could be the cause of major battles for a long time.
GM does not have problems like this with the CAW since they have a Nationalized Healthcare system, and Mexico, labor is cheap.
As I was getting too, GM has a lot of excess capacity. Willmington, wehre they make the Kappa cars (Solstice, Sky, and soon the Opel GT) will only take 50k units, but Willmington was deisgned to make the Saturn L series, which was predicted to sell over 250k units. So there is capacity for 200k more cars!!
The idea is for GM to be running on full capcity, and that needs to be done with more flexable chassis designes, and possible dual production lines in the same plant. What if you could make a RWD Impala and a FWD Malibu int he same plant, side by side. If demand for Impala went up, and Malibu down, you could adjust produciton as needed, and vise versa. They need to be adaptable to market changes. They also need to get people to stop thinking that GM is Rebate Central. GM needs to beat expectations, and come in below the price mark. But this is all easier said then done. Only way for GM to start to become more profitable is to decrease overcapacity, slash health care costs, and be more adaptable int he US and world wide with global chassis, but thast another story for another day.

My rant is over. If you want ot help, buy GM. After all the adjustments and retooling of plants, and GM starts making super great cars and great prices, there will still be the problem of image, an image set in peoples minds of crappy cars from the 80's to the 90's. Its that image that will take the longest to get rid of. You can show them all the quality reports, and JD power scores, crash tests, EPA fuel economy, the ability to have people give GM a 2nd chance, thats what will be GM's biggest mountain to climb.
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Last edited by BigAls87Z28; 01-17-2006 at 11:12 PM.
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