Wow - Didn't Think Chrysler Was In Such Bad Shape

[Distantshore]

Wrong thread.

[jemaholic]

Part of the problem - and it's indicative of many US businesses - is the refusal of unions to bend and make appropriate changes that would address today's problems.

The unions run the car industry - and the business model is old and expensive. If pacific-rim manufacturers' labor cost $4-6/hour, the same US labor costs $25-35/hour. We've priced ourselves right out of the competition - add to that a lower quality/higher maint. finished product.................it's just like watching dinosaurs go extinct.

This whole bailout is a JOKE. In 3 months there is NO WAY these companies will turn around well enough to repay the loans. That means we americans give them billions - and 3 months later they will close their doors anyway.
~j

[elcid]

blah blah blah unions blah blah blah.
The foreign cars made in the states aren't using $4-$6 /hr labor. Last time I checked the union workers were making $29 and change an hour to the foreign makers $30/hr and change. How the fck is anyone going to support a family in the states on $6/hr? Would you trust a car made by someone who makes less than a fry cook at McDonald's?
The foreign made car companies dont have to pay the taxes American makers pay, they dont have to worry about things like OSHA or the EPA. The foreign cars that are made in America still aren't taxed as American companies or anywhere near as much. The Japanese government backs the R&D for the Japanese companies, and backs retirement & benefits. It's an all around unlevel playing field and unions are a small part of the problem. The biggest problem is people dont want to look into the big picture and find unions to be easy scapegoats, and they hold on to anitquated beliefs about american cars.

1)reliability isnt the issue it was 20-30 years ago. I know, bammbamm mentions one bad experience with his wife's American truck and now he swears off the entire industry and labels the cars as turds. Most of my family is in construction and we beat the piss out of our trucks. My brothers F350 is almost 10 years old with 160K on it and it still runs like champ.
2)in the same class, US cars get just as good if not better gas mileage than their foreign counterparts. Comparing an Escalade to a Civic. Compare a Titan to an F150
3)there isn't a UAW worker making $70/hr even if you figure in there benefits.


Dammit I wanted to stay out of this thread becuase I'm sure it will turn out like the last bail out thread.

[elcid]

Originally Posted by jay ratkowski

The Charger re-release was supposed to be that car. But instead of making it a somewhat affordable, super-cool sports car that they could sell in low volume at high profit... they turned it into something that was fleet-friendly. Then the Challenger came out and it ends up being like when Ford did the last T-Bird; completely out of the price range for the people who want it.

I've seen new Challengers for around $21-$23K. It wont be the bad assed one, but that one is priced evenly with a Vette and in the same league as it.

[Canadian Mark]

Originally Posted by elcid

1)reliability isnt the issue it was 20-30 years ago. I know, bammbamm mentions one bad experience with his wife's American truck and now he swears off the entire industry and labels the cars as turds. Most of my family is in construction and we beat the piss out of our trucks. My brothers F350 is almost 10 years old with 160K on it and it still runs like champ.

This, I think, is a major cause of the problems for the North American automakers. For everyone trashing the quality, have you owned a north american vehicle built in the last 5-10 years? In the 80's and early 90's I agree that the quality was lacking. But that was then and this is now. Unfortunately, consumers are still judging them on the quality of the 80's and 90's.

There's been more than one occasion when I towed my inlaw's volkswagons and bmw's with my Dodge Dakota.

[eviltwin]

that anti-union sentiment is getting really old...

1) the math is wrong, they're adding pension payments to the wages, but don't divide by number of workers plus the pension holders.

2) those companies should've set money aside to pay those pensions when the retirees were still working, they tricked the bookkeepers. Deferred payments only make sense if you actually own the money or are making it. GM cut its workforce from 800,000 to 300,000 in 20yrs.

3) for every 100 assembly lines workers earning 4k$ a month,
there is manager at 40k$ a month,
for every 1000 workers an exec at 400k$
and for every 10,000 a CEO at 4million a month!

This structure adds over 25% to labor costs. These are just guestimates, in reality they are most likely even more top-heavy.

From the numbers quotes on the net, I estimate that for every regular worker earning 30$/hr the management structure adds 15$ in labor cost and another 30$ in pensions/entitlements. How much of the latter is actually overdue golden parachutes from past reorganisations remains the question (remember the lost 500,000). But it is again very likely that only 20$ goes to retired factory workers, the remaining 10$ is for (retired) management.

In other words 4% of the workforce takes home 40% of the money. Highway robbery, plain and simple.

4) Korea has unions, France, Germany, etc. shouldn't their manufacturers be in similar problems? The Europeans are getting loans, but their problems are incomparable in scale or depth, in Korea SsangYoung is dead broke but they are an SUV only company.

5) the general focus on personel cost is disproportionate. It's a smokescreen to distract people from the real reasons they are doing poorly. Again let's do the math:

avg car costs ~20k$ (30k to consumer after distribution, taxes, dealer cost)
of which
5k energy,
5k materials,
5k development/infrastructure/capital/overhead,
5k labor

GM builds ~8million cars/yr
employs 300,000 * 120k$/yr= 36B$ wages/yr
spread over 8million cars= 4,5k$ wages/car, QED.

Note that in these numbers all employees are averaged across the globe.
GM only employs half it's workforce in NA, but has local plants in China, Korea, Australia and most importantly EU.

Their revenue is 182B$, they are losing money. In fact 38B$ this year
http://money.cnn.com/magazines/fortu...008/full_list/

At the rate of the current losses, even cutting all legacy costs to all UAW retirees is not going to make them profitable, neither would cutting all wages in half, or even getting rid of their CEO and his corporate jet In fact GM's workers would need to work for free for GM to even get in the black.

Note I've had to use GM, because they are a publicly traded company. Figures for a private company such as those for Chrysler/Cerberus are not public. But trust me when I say Chrysler cannot be in a better state than GM.

[bammbamm]

Originally Posted by Canadian Mark

This, I think, is a major cause of the problems for the North American automakers. For everyone trashing the quality, have you owned a north american vehicle built in the last 5-10 years? In the 80's and early 90's I agree that the quality was lacking. But that was then and this is now. Unfortunately, consumers are still judging them on the quality of the 80's and 90's.

There's been more than one occasion when I towed my inlaw's volkswagons and bmw's with my Dodge Dakota.

Wife's Jimmy is a 2000, she drives all of 10 miles to work every other day.
At 80K miles if I'd paid the dealer to do the repairs, we're looking at a 4000+ repair bill.
I spent 800 in parts and did it myself.

#2 My family has owned mostly American cars since I can remember, my dad went through 3 F***in Ford Tauri, EVERY SINGLE ONE had the EXACT same problem, crappy transmission and their planetary gears melting down. Only reason he had 3 was his company paid for the car note, but repairs were on my dad. Oh yeah, 3rd one, the trans went and the head gasket blew.

Meanwhile You have the car companies in the US making stuff that is uninspiring and dull. Find me a Chevy product that compares to my Acura and that has the same reliability.

While I was getting all the parts for my Wife's truck last year, a guy with a 1 year old Monte Carlo had to replace his wheel bearings, and GM wouldn't cover it, why?
"That is a wear and tear item, sir"

Typical.

Substandard products.

Substandard warranty.

Why should I buy American if they are going to sell me **** and not back it up when it starts stinking like what it is? My Wife's truck rattles, squeaks, makes so many noises I can't stand driving it when I have to. The electrical took a **** on it and luckily THAT was covered by the warranty, but what incentive do I have to buy a car that gets awful millage, sounds twice as old as it is with routine maintenance and care?

My Honda was tight as it was the day I got it and the day I got rid of it. I was sick of the car when I sold it I just needed something new and nice, and guess what, it's still on the road today...

Sorry, but fool me once, shame on you...

[Canadian Mark]

Are you serious? You think civics, accords, camrys (the big sellers) are more bold and inspiring than vettes, vipers, 300's, magnum's, chargers, grand prixs, cts's, mustangs, etc., etc.? Japanese cars are notoriously bland when it comes to styling. I believe Kotornut addressed this in another thread.

Are you calling mercedes junk? The 300's, Magnums, and Chargers are built on Mercedes platforms and use Mercedes transmissions.

The warranty issues you spoke of usually come down to individual dealerships. If they want they can put most things through warranty. Sounds like you have a bad dealership.

You want rattles and squeaks, buy a Yaris.

You want bad mileage, buy a Tundra.

I agree that Japanese cars are high quality. But to say all North American cars are junk is a whole different (dangerous) ball game. That attitude is contributing to the problems with the U.S. economy.

[eviltwin]

Originally Posted by Canadian Mark

Are you calling mercedes junk? The 300's, Magnums, and Chargers are built on Mercedes platforms and use Mercedes transmissions.

they are junk, the E-class they are built on is an old generation (my1995 W210) much like the Crossfire was an old SLK (my 1998 R170) The late 90s E- and C-class are well known for rusting (trunklids etc.), check the German fansites and Autoforums. R170 is decent, but Crossfire has already been discontinued.

Note that the 2002 generation E-class (W211) suffers from terrible electronics issues. MB has just released info on its successor (EU my2009, prob 2010 for US)

Mercedes A and B-class, which are not available in the US, but perhaps in Canada, still suffer from rust. (doors and sills)

One of MB's main goals with the Chrysler takeover was to get a foot in the door for its commercial vehicles, which incidentally have a terrible reputation as well. They forced Chrysler fleet-customers into MB vans.

Selling old MB-platforms as new in the shape of 300s etc. was just another way to make a quick buck.

[Canadian Mark]

The rusting you pointed out has nothing to do with platform, but sheetmetal.

When I start having problems with my 2005 magnum with 100,000 km's I'll let you know. So far, so good.

My friends have a dealership and they sell a lot of this platform, mainly 300's. They would be the first ones to tell me the trends they see in problems. They have seen VERY few problems.

Crossfire was discontinued mainly due to poor sales, not quality.

You should ask my inlaws about electronics in their BMW.

[jay ratkowski]

Originally Posted by Canadian Mark

Are you serious? You think civics, accords, camrys (the big sellers) are more bold and inspiring than vettes, vipers, 300's, magnum's, chargers, grand prixs, cts's, mustangs, etc., etc.? Japanese cars are notoriously bland when it comes to styling. I believe Kotornut addressed this in another thread.

You've gotta compare similar classes of cars (can't throw limited production models in like a Vette/Viper).

While the interiors are bland and uncomfortable, the Hondas are fairly stylish as the Accord/Civic simply copy the current generation 3 Series. Not original, but stylish.

Most Japanese automakers are on a 3 year plan with their models to keep everything looking fairly fresh. Whereas, I couldn't tell one Pontiac from the other from about 1994-2007.

[elcid]

Isnt arguing taste pointless? I'd rather walk than be seen in anything that vaguely resembles a car that may be misconstrued as fast or furious. Big pointless spoilers and exhaust pipes that make the car look like it was violently sodomized don't strike me as stylish but there are a ton of people who think they are the cat's ass.

[andy7jem]

Be thankful you don't live over here 'Cid!! The place of full of that sh*t

[elcid]

Trust me, it's all over here too. My sisters husband is one of those guys. He had a $15K civic he put another $13K into. Spoiler, exhaust, lcd screens,PS2, lights underneath it, red rims, hood pins, all that garbage. The happiest day of his life was when he took it to the track and managed to pull 16 seconds in the quarter.

[jay ratkowski]

Originally Posted by elcid

Trust me, it's all over here too. My sisters husband is one of those guys. He had a $15K civic he put another $13K into. Spoiler, exhaust, lcd screens,PS2, lights underneath it, red rims, hood pins, all that garbage. The happiest day of his life was when he took it to the track and managed to pull 16 seconds in the quarter.

It's a frustrating hobby. If you are serious about performance, not just the look of performance, you can quickly find yourself in a battle to try and be different from the kids with $20k of visual mods invested into their '98 Civic. Kind of like when you're a guitarist and you don't want to be associated with the ****ers at Guitar Center playing Seek & Destroy out of time and as loud as possible.

Anyway, a portion of your car buying decision should be that the vehicle accentuates your personality. However, a lot of people buy cars in order to accommodate for a lack of personality. I found that out in a hurry when I had a brief stint as a "member" of local car enthusiast groups.