Daily Archives: November 18, 2008

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UAW And Other Dinosaurs

One of the main reasons the big three automakers can’t compete with other automakers IN THE U.S., (Hyundai, Toyota, Honda, BMW and Mercedes ) is the three-letter word UAW. That would be the United Auto Workers, aka Big Labor.

Automakers are in Washington today with hat in hand looking for some of our money to keep them afloat. Unfortunately for them, no amount of our tax dollars can repair the rotting hull in the auto industry’s boat.

Average hourly wage by selected workers.

Any ‘bailout’ would be a union bailout, not a company bailout. Nor would it be a permanent fix. The way out for the automakers is to reorganize under Chapter 11. Chapter 11 is the only way out of the union contracts. That’s the only way to reorganize in such a way for these automakers to have a chance of being profitable again. Otherwise, they’ve earned the right to fail.

Granted that it was the management of these automakers that agreed to such extravagant benefits, at the threat of a strike, but it doesn’t take a rocket scientist to see how labor unions can put not only the auto industry, but any industry at a competitive disadvantage, including small businesses that need all the help they can get. If unions go away, no one suffers. If large and small businesses go away, everyone suffers.

The only automakers in the United States that are profitable are the ones that are non-union. UAW president, Ron Gettelfinger is in total denial when he asserts that union costs and contracts are not the problem . . .

The domestic auto industry simply cannot succeed in today’s unstable economic environment without immediate help from the federal government.

Oh really? Can you say Hyundai, Toyota, Honda, BMW and Mercedes?

It is not the actions of our members that have caused the crisis in today’s auto industry; the crisis is being driven by economic factors that have nothing to do with labor costs or factory performance. To the contrary, our contracts have put our employers in a position to compete.

In his editorial, Gettelfinger calls the wage and benefit gap (see chart) an alleged wage and benefit gap.

A Nov. 8 Post editorial claimed that unionized auto manufacturers pay “wages and benefits that far exceed those of non-union competitors,” but recent labor negotiations with Chrysler, Ford and GM addressed this alleged wage and benefit gap.

Awash in delusion as he is, Gettelfinger says this . . .

Our 2007 labor negotiations with the companies transformed the domestic auto industry; when the agreements we reached have been fully implemented, they will largely or even completely eliminate the labor-cost gap between unionized auto plants and our nonunion competitors. One analyst has estimated that as a result of our contracts, GM will soon enjoy a labor-cost advantage over Toyota.

Speaking before Democratic Congressional lawmakers last week, Gettelfinger had this to say . . .

The prospect of concessions from the union came up during a meeting involving executives of Detroit’s Big Three auto makers and Democratic Congressional lawmakers on Capitol Hill Thursday. But UAW President Ron Gettelfinger made clear that concessions were out of the question, union lobbyist Alan Reuther said in an interview with Dow Jones Newswires Friday.

“Workers and retirees have already made significant sacrifices,” said Reuther, paraphrasing remarks that Gettelfinger made to House Speaker Nancy Pelosi, D- Calif., and others in the meeting, including renegotiated contracts. “We feel we’ve already stepped up.”

Bottom line, those that still want a job can be rehired. And for any of the ‘2 million arguments‘ for a bailout that can not adapt or refuse to adapt to a reorganization, they also have an option. It is called Chapter 13. Get off of the taxpayers’ back. That the UAW accepts no responsibility for this mess is insulting.

The solutions are out there and currently available without another government takeover. And the solution does not include the United Auto Workers Union.

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