Greed, not unions, brought GM down

[catbert]

I say "Greed"

I think you are 100% correct. The folks that made all those bad decisions about products and labor contract knew that they would be long gone before the ducks came to roost. American industry is too concerned about the next quarterly profit, and doesn't seem to care about everything that follows. In military jargon: everything was tactical, nothing strategic. I hope the Volt and other long term innovations signal an end to immediate gratification at GM. In order for us to enjoy fun cars, GM has to have a solid line of everyday appliances that people buy by the millions.

 

[Mac]

In military jargon: everything was tactical, nothing strategic.

Exactly... and they can't understand why other car companies are walking away with market share... :W

-Mac

 

[catbert]

Exactly... and they can't understand why other car companies are walking away with market share... :W

-Mac

Oh - They understand, but they can take the money on the way out the door - right Rick?

 

[NORTY]

Here's what I see as GMs biggest problem~

For instance~
Back in the 1970's, GM was experimenting with diesel fuel converted gasoline engines in Olds,Caddy, GMC trucks and other models. This was a dismal failure as GM didn't do "due diligence" on their part, before releasing to the public. These cars suffered from all kinds of problems, mostly mechanical & electrical. The public got stung with a poor quality built/engineered vehicle. This caused a lot of people to "swear off GM cars." PERIOD.
These people had kids. Those kids they had ARE NOW DRIVING AND BUYING FOREIGN MADE VEHICLES because of a "perceived quality" issue with GM cars. They also consider foreign cars to be superior to domestic cars. (Resale value proves this.) As with English class, there are exceptions, but not many.
It's not hard to believe that something like this could effect a company after 30 years but it can, and does. Company reputation is everything. Everything.

Remember when Coke-a-Cola decided to replace Coke with their new formula that sucked? They had to bring back Coke "Classic" as they were losing their collective asses to other beverages. Some people still won't buy their products even though they have have been replaced with the same formula as before. People don't like being manipulated with (jacked with as the kids say today) by companies. Customers will take their dollars elsewhere.

This is what has happened to GM.


The fix? I don't know, I just don't know.

 

[njlouc]

The economy as it is has forced so many to see what is behind the curtains. When times are good so many things are swept under the rug and the public doesnt care. I am afraid that Greed is the answer. After that the unions see the levels of greed, corruption, and levels of incompetence and demand their cut.
The famous Disney company pulls in millions per year yet their stock is going nowhere. Additionally they are always crying the blues at how the economy has caused them to reduce their overall income.That said a good example of a bad example is found below.

Robert A. Iger – $51.1 million
Company: Walt Disney (DIS)
2008 Stock Price % Change: -29.7%
Annual Revenue: $37.843 billion
CEO Compensation Change from 2007: +85%

Compensation Breakdown:
Base Salary: $2,000,000
Bonus: $13,670,686
Perks: $745,177
Stock: $7,755,103
Options: $3,494,447

You all know the money that GM's Waggoner made after years of MISMANAGEMENT.

AND this is usually the top guys. There are hundreds on the payroll making Huge money.
As you may suspect the Engineers and line workers make relatively little.

 

[killain]

Guess what the American Auto Companies were not the only ones making junk back in the 70's and 80's. I observed plenty of Japanese cars being towed back then. Especially the Civic, what a total piece of crap that think was ! Tell your brother in law to go into GM or Ford showroom he would be stunned at the quality improvement from those days. To swear off American Autos because of the cars they made back then is just plain stupid ! And who knows the job you save could be your own ! I'm 57 years old and have never owned a foreign car, and I never will. And I make it to work every day driving one.

There is no use in that statement. Sure the Japanese early offerings were pretty bad, BUT they saw the light and started building solid and cost effective vehicles. I don't care how many surveys you conduct, Japan, Germany and South Korea lead the pack in sales. And now with the 'cash for clunkers, the domestic makers got 43% of all new car sales, which is a good sign, but all those Toyotas, Hyundai's, Kia's and Nissans are still leading the pack. As far as my brother in law, he spent a LOT of money on Detroit offerings, and got burned on every sigle one. WHY would he even consider a domestic car now?

Personally, I have bought my last domestic as well. For me, way too many problems without cures, dealerships without educated technicians and customer service which is as close to non-existant as possible, cars that have absolutly no appeal to me and the price for a domestic is on par with a foreign vehicle, yet the foreign manufactures give you a much better warranty. Hyundia even will take the car back if things don't work out for you, and they offer a 10 year/100.000 mile warranty. To me, the Hyundia Genesis coupe is well worth the price tag. What doesFord, GM or Chrysler have that even comes close? . . . Nothing !

 

[catbert]

With all this being said, I can't imagine buying a foreign nameplate while there are domestics that deserve consideration. My next purchase to replace my wife's 07 Saturn Aura will be a Mercury Milan second generation hybrid. It's good looking, trouble free for the last 6 years and gets over 40mpg in town. It even got Toyota and Honda loving Consumer Reports best buy in class designation, beating out the Camry for the first time since.......ever.

Brushing off domestics is not a valid conclusion in my opinion. Unfortunately GM is waaaay behind Ford in "cars that make sense today."

 

[killain]

Well , you make an excellant point. It was stupid of me to simply rule out detroit offhand. And I will promise to look at what the domestic automakers have to offer, before I look to the land of the Rising Sun.

 

[Mac]

Brushing off domestics is not a valid conclusion in my opinion. Unfortunately GM is waaaay behind Ford in "cars that make sense today."

Agreed on both points.

That being said, it's the same unions who have all three domestics by the short-n-curlies. As much as management has to bear their share of the blame, the unions shouldn't get a free pass. My only way to affect change is my purchases (says a guy who owns 4 domestic cars and a domestic motorcycle) and when replacement time comes, I will decide whether the domestics have earned my continued support or not.

If that decision was to be made today, Ford would be the only one considered of the domestics... and it would have to be a good deal...

-Mac

 

[catbert]

Just for the hellofit test drive the Milan Hybrid. It's a jaw-dropping improvement over any midsized sedan I've driven lately, and I've driven them all. It's quiet, like NO NOISE in hybrid mode, plush, handles and rides well, has great safety ratings. The one I test drove had leather, Nav, rear/side TV/warning - the whole enchilada. The Milan has all the good features of the Fusion, is better looking, and it doesn't say FORD all over it.

Ford has snuck up on, and surpassed GM right where it hurts - midsized sedans, Malibu nowithstanding. Next year the European Focus will arrive. It is a world class subcompact/compact. Probably better than anything sold in the US now, including the Civic...and it's fun. The car business will be interesting fior the next few years. I'm a lifelong GM booster, having owned 35-40 GM vehicles of all its' brands, but I'm buying a Ford, and I'm not betting the farm GM has a clue yet. hnoes

 

[Curious George]

That being said, it's the same unions who have all three domestics by the short-n-curlies. As much as management has to bear their share of the blame.

This would be the most accurate assessment of this mess. You can't blame the Unions for asking, but you sure can blame GM what they agreed to. Health care is important and should be available for a reasonable cost. Key word there is 'reasonable'. Pensions - this was a bad idea from the start, people should manage their own retirement fund. A first grader could tell you that paying somebody who no longer works for you will catch up to you in time. I guess money just grows on trees after all.

It is amazing how many people, who are in leadership positions, cannot, will not or simply do not have the skills to be a leader.

In my opinion, Unions have outlived their usefulness. If the Japanese can make cars, without unions, and have happy workers, than other organizations should be able to also.

CG

 

[darkstar]

Agreed on both points.

That being said, it's the same unions who have all three domestics by the short-n-curlies. As much as management has to bear their share of the blame, the unions shouldn't get a free pass. My only way to affect change is my purchases (says a guy who owns 4 domestic cars and a domestic motorcycle) and when replacement time comes, I will decide whether the domestics have earned my continued support or not.

If that decision was to be made today, Ford would be the only one considered of the domestics... and it would have to be a good deal...

-Mac

Very well said in my opinion.

 

[manofsteel]

RIGHT ON BROTHERS!!!! BIG BONUSES, NEGLECTING NEW DESIGNS FOR GAS ECONOMY THAT IS WHAT DID MOST OF IT. REMEMBER, UNION WORKERS WERE JUST TRYING TO KEEP UP WITH THE COST OF LIVING. WHY NOT? IF IT WASN'T FOR THE UNIONS, WE'D BE ALL WORKING FOR $1.00 A DAY AND IN SWEAT SHOPS. HOW ABOUT THOSE PROFESSIONAL ATHLETES.......IS THAT FAIR? Mnnnnnnnnnn. Think about it

 

[Mac]

RIGHT ON BROTHERS!!!! BIG BONUSES, NEGLECTING NEW DESIGNS FOR GAS ECONOMY THAT IS WHAT DID MOST OF IT. REMEMBER, UNION WORKERS WERE JUST TRYING TO KEEP UP WITH THE COST OF LIVING. WHY NOT? IF IT WASN'T FOR THE UNIONS, WE'D BE ALL WORKING FOR $1.00 A DAY AND IN SWEAT SHOPS. HOW ABOUT THOSE PROFESSIONAL ATHLETES.......IS THAT FAIR? Mnnnnnnnnnn. Think about it

Big bonuses were a problem, no question about it... Hard to sustain a business when the executives aren't performing but are lining their pockets.

New designs are important, no question about it... Innovation is the lifeblood of any business, especially one as competitive as the auto industry. Fail to innovate; expect to fail.

As for the union workers just trying to keep up with the cost of living, that's a load of fetid fertilizer. Whatever happened to a fair wage for a fair day's work? With unions, the wage is as much as they can screw out of the company and the work is as little as they can get away with.

When unions came into being, they were needed as the employers were taking advantage of the workforce. There were no labour laws to protect the workers and the employers had all of the cards but one: the workers could strike and closed the place down.

Guess what? Labour laws now exist and employers who treat their employees poorly do so at their own hazard. So what purpose do unions serve? Very little. So how do they justify the union fees they demand? By promising more... more wages, more benefits, more of whatever they can screw out of the company.

Unions have become that which they were formed to fight: a powerful, demanding and unreasonable group who exploit the workers, take more than their fair share and give as little as possible in return.

I thought about it. The day that any union member works as long and as hard to get his job, with as much performance expectation and keeps that job with as little job security as any professional athlete does, you can make that comparison. Until then, you're just blowing smoke.

-Mac

 

[njlouc]

Let's face it we are looking at this entire issue with naive eyes.
IMHO the management AND unions are complicit in the whole affair. You have to consider the union top as management also. The (GM) management gave the unions what they wanted and vice versa so they could all keep their big $$jobs and possibly a few Swiss accounts. In the day they all made millions at the expense of pollution control/design/safety/quality. Under normal conditions you would say that they got what they deserve - NOT.
They got huge $everences/retirement packages.
They could have hired me. i would do the job for $1million/yr. I could never screw up as much as the money they would save on my pay.

 

[coffeejolts]

I suppose the unions brought down Lehman Brothers and Bear Stearns, too!

In my experience, the people who bash the unions the most are those who have never been in a union. It is management's job to manage, and the workers' job to work. The managers are always there en masse, ensuring that the workers work. The problem is that there isn't anyone watching the managers.

 

[vigman]

Management sets the companies DIRECTION

The "Big Brass" set's up the cost cutting.. read a rivet instead of a nut & bolt.


The person who set that up makes a spread sheet touting over a 5 year period
how much that will save the company ( attach large eyepoping number here ).

That person becomes a mover & shaker.

While all the union suggestions are swept under the rug, because the change will be to costly.

The people who actually WORK become fewer & fewer.. as you ADD more bean counters, to sit in meetings ( read waste of time ).

How serviceable is your car? Compare 1980 to today...
Yes the cars are more efficent fuel wise.. but they are POORLY BUILT..

When was the last time you tried to repair a window motor??

The cost of making a car is going up.. and the quality is going DOWN.

The union rules are to give the rank & flie a FAIR SHAKE & not be worked to death ( when was the last time you checked out working conditions on a chinese assembly line? ) As far as the movers & shakers are concerned, that's fine as long as the product ships on time.

As a Country, we are falling WAY BEHIND because we do not make things any more that have QUALITY.. sure we have a handful of products that are good, but most of the stuff is WAL-MART quality, plastic, designed to last less than 2 years with zero failures..

Not the unions..management, they set the direction and their compass is pointed DOWN.

Lower cost.
Lower payroll on labor.
Outsource jobs. ( read lower cost ).

It stinks!

Vig~

 

[njlouc]

Now we have a new scenario.;help
A major conflict of interest... anti trust.hnoes
The unions own a large stake in GM and they are negotiating with Ford????
What gives?? Is that some craziness. Why doesnt Barney say something about this??

 

[Mac]

I suppose the unions brought down Lehman Brothers and Bear Stearns, too!

In my experience, the people who bash the unions the most are those who have never been in a union. It is management's job to manage, and the workers' job to work. The managers are always there en masse, ensuring that the workers work. The problem is that there isn't anyone watching the managers.

I've been in a union and my mother was a shop steward for years. Now I'm a manager. I guess I don't fit your "mold" eh?

There's more than enough guilt to go around. The biggest flaw on all sides is one of the seven deadly sins: GREED. That defies job classification.

-Mac

 

[darkstar]

I've been in a union and my mother was a shop steward for years. Now I'm a manager. I guess I don't fit your "mold" eh?

There's more than enough guilt to go around. The biggest flaw on all sides is one of the seven deadly sins: GREED. That defies job classification.

-Mac

Again, Mac, you have absolutely hit the nail on the head!!! GREED at all levels.