Saturday, October 01, 2005

The Auto Industry Today

It's a tough time to be an autoworker in Michigan, and it does not look like it's going to get any easier in the immediate future. This story is typical of what we are facing. Fortunately, in our case, we are attempting to do more with other industries and some of the auto companies, such as Toyota, that are actually doing fairly well. But it is going to be tough for a while.

I see the Union and Management blaming each other for the problems, and I have to say that I see no innocence anywhere. Until both sides acknowledge that they are partly to blame and both sides make the changes needed our Domestic automakers are going to keep spinning down the drain, and everyone seems to think that the changes needed are someone elses responsibility. Management, Labor and the Public have got to come together and recognize that the survival of all depends on the survival of the company, and differences need to be put aside. Everyone needs to make some sacrifices, and that includes hourlys, management, executives, stock holders, and retirees, and if all the share in the sacrifice, it will be smaller per person.

I don't know about exact numbers, but something reasonable would be that all salaried people give up 5-10% of everything they earn above, say $20,000 to $26,000 per year. Those on pension would take similar cuts. The hourlys would lose 5-10% of everything above $10.00 per hour. I don't know what the exact numbers would need to be, but it's going to be a choice of lose a little bit now or lose everything later

About 20 years ago, Chrysler was in a similar bind and they pulled out of it with a government loan (which they paid back) along with across the board cuts in pay and salary. GM and Ford may have to do the same thing.

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