Thats good Aaron!!

 

Lincoln is too expensive for them. Somebody who's been driving let's say Taurus and wants to move up can't really afford $40,000 MKS. Or Fusion. I paid $15,500 for my Fusion, and if I wanted to move up and Mercury was non-existing my only option would be MKZ. I can't afford $33,000 MKZ. However, I can afford $22,000 Milan.

Mercury has been a rebadged Ford since early 1970s and they always had their part of the market.

 

Mercury should be a premium hybrid brand IMO.

 

Uh, dude, it's all smoke and mirrors. There is no significant difference between the Fusion and Milan. It isn't nearly enough to justify an entire marque. All that's needed is Ford and Lincoln, unless you're going to make Mercury a stand-alone brand with its own unique identity.

I appreciate you reading the history of this company, but today's automobile industry is now global...and vastly different in execution.

 

Or they could just make a premium edition of the Fusion. Why spend all the extra money just to have a different name on it? It doesn't make sense. How many people buy a Milan over a Fusion for the sole reason of not having a blue oval on it? Toyota doesn't have a brand between Toyota and Lexus. Look at other car brands, they don't have this near-luxory brand stuck in the middle. Nothing between Nissan and Infiniti or Honda and Acura.

 

Retiree costs is a benefit. Does Toyota provide the same pension plan as GM? If not than you still have to compare the $73 to $48 since it still costs GM that much money.

 

No, retiree cost is NOT part of the compensation a worker receives per hour according to the article I quoted in this post. It is part of the legacy costs, the costs of supporting currently retired workers. The $73 figure is the total cost per worker per hour to the company:
$31.75 ---wages and overtime
$19.25 ---benefits (medical, dental, life insurance, etc)
$22.00 ---cost of currently retired employees (pensions, benefits)
==========
$73 Total Cost per hour

Actual wages & benefits are pretty close:
UAW: $51 per hour
Toyota: $47 per hour

But each employee at GM has an additional legacy cost of $22 that US Toyota workers do not have since they do not have any retirees due to the fact that the plants have not been here in the US long enough to have anyone retire yet.

The article I was commenting on in this post claims that UAW workers' total compensation (wages and benefits) is $75 per hour, which sets the tone of the entire article, playing to the myth that UAW workers are grossly overpaid when in reality they only make $3.75 an hour more than non union autoworkers at Toyota.

The cost of each worker IS higher at the GM due to the legacy costs (retirees) that Toyota doesn't have.

The new contract negotiated in late 2007 has new workers starting at $28 per hour wages AND benefits, which is why GM had offered every UAW employee they have a buyout early in 2008, so they can hire new workers at the lower compensation. Ford has been offering buyouts to workers for at least four years in order to get employee costs down.

 

No matter which side you spin it, the UAW is killing the Big 3 in terms of cost. FYI, the 2007 contract won't really see significant benefits until 2010/2011. The union needs to make the 2007 concessions right now!

 

GM Hired 3,000 workers at the $28 (wages and benefits) rate who will soon be out of a job:
19,000 GM workers at the $51 wage/benefit rate took the buyout offer:
Big Number for G.M.: 19,000 Take a Buyout

 

Per the UAW's website, the Big 3 employee 180K UAW members. GM is the largest UAW employer at 73K. You aren't looking at the Big picture. Like I said earlier, the real saving of the 2007 contract don't really go into affect until 2010+ (hint: VEBA).

The UAW will need to revisit the VEBA agreement, kill the job bank, and cut wages & benefits further for current employees.

 

The irony there, of course, is that doing something like that is anathema to what the UAW stands for.

Which makes the UAW largely redundant at that point.

 

Here is an interesting video. Ford has done this in Brazil and it works very well but it is something the UAW has fought against from day one....

This is an example of where companies will seek offshore assembly plants if the UAW keeps strangling them.


http://info.detnews.com/video/index.cfm?id=1189

 

Well, another thing to consider is the fact that the most reliable vehicle Ford has EVER built is the Fusion. And it's built in Mexico.

What does that tell you?

 

.....that there is no UAW in Mexico?

 

And Ford is still beating both Nissan/Infiniti and Honda/Acura, aren't they?

 

I was going to post that too. This "technology" isn't new either. It's basically expanding on Toyota's lean manufacturing model.

 

Yep, and that Mexican workers produce better quality for less money.

The downside is that their cost of living is also lower, so paying Americans to do the same job for the same wage would put American auto manufacturing job wages only slightly above the poverty level.

 

Beating them in what? Profits? I also mentioned Toyota.

Here are the auto manufacturers net incomes in US$:

Toyota: 17.15B
Honda: 5.989B
Ford: -2.723B
GM: -38.732B

So not sure how you can say Ford is beating Honda. I guess if you are just going by sales, but GM beats Ford in sales and look how that is working out for them.

 

Exactly.....and just why do you think Ford looked toward Mexico for assembly and labor?


The UAW forced them to seek lower costs for production.....we keep coming back to the same common denominator for one of the major problems that plague the Big 3.

 

That Brazilian plant is like the 21st century equivalent of the Rouge Complex, which used to have its own docks, a steel mill, a saw mill, glass plant,foundrys--- everything need to build a car on site.

Even without the union in the way, building a plant like that in the US would have been difficult, with the EPA, environmentalists, zoning laws, etc. No wonder they chose Brazil. Ford used to have a huge rubber plantation down there too.