in the US between 2005 and 2008. Guess it's not looking good for 'em after all.

Mike

 

As much as I dislike GM vehicles, it pains me to see this. 25,000 good American workers losing their jobs is not something I like to see happen.

 

It will impact a lot more than 25,000. It will impact the employees of suppliers, the businesses that these people buy from and many others. Each job loss impacts several others.

 

This will impact all of America this is VERY SAD

 

Were they planning to eliminate these jobs entirely, or move them elsewhere, such as Mexico?

 

No these are jobs that are gone + two plants to be named soon.
Probably oldest ones.
Only North American is affected
Pray for GM because this could be a very bad spiral down for many not just GM
This is all about overhead, like retirements and insurances, so goes GM many could follow...just like Delta is now trying to follow United ...not good .

 

The UAW is squarely to blame for that. Ford and GM spend more on health coverage than for steel. Over $1200.00 of every vehicle sold goes to healthcare. Poorly negotiated contracts bring that on. That's over a BILLION dollars that Ford has to pay just for producing the F-Series. That raises the fixed cost on every vehicle made, resulting in a profit reduction as well as higher prices for consumers.

 

This is not about overhead IMO. Its all about over capacity. Even whithout the medical plan cost and there mismanagement or the pension plans they would still need to close the factories. If you are not running at close to 100% utilization you are losing money.

United and Delta are different in that is is about overhead because they do not produce anything only provide a service. While it is true theat the legacy cost are hurting GM it still holds that if you don't have product you must close or combine capabilities.

 

I think it is a combination of overhead and over capacity...
The big 3 have realised that they aren't going to keep making money if they concentrate purely on their American market.
The American market has developed fully at the moment, and they are now throwing money at creating new markets.
Ford for the 1st quarter of this year (and it may have continued into the 2nd quarter, I don't know) put a worldwide restraint on hiring any new people.
So if a person retired/left/got fired etc. they could not be replaced.
This was primarily to show shareholders an increase in profits.

 

You are right but for the wrong reason. Health care cost are affecting everyone and is not just a Ford and GM problem. The more people who do not have health care coverage the more it cost for health care, be it taxes to cover people without coverage or higher insurance premiums because less people are covered.

But I could not believe what I read in the article though concerning the contract though. I have never seen a contract where people get paid even if the factory is shut down. Anytime a union write a contract that does not allow a company to operate at a profit they are just hurting themselves. It is this type of action that gives unions a bad name.

 

I read this in the news today. GM is cutting 25,000 jobs over the next few years. I'm not surprised, but it sure puts this whole thing into perspective for me. Whats are your thoughts?

 

This will affect Canada in a big way as well. Th CAW was shocked, as the article put it. I believe healthcare is a huge part of it, $5 billion a year, $1500 a vehicle. That is a lot of money. They lost over a billion this first quarter over last year. Isn't there some sort of cap that we can put on the foreign automakers number of vehicles allowed over seas in a year? Is there already such a thing?

 

It's a cut back just like in anyother company. It's either to save money because they need to save money or their operations have become more efficient. Most likely the first one. Only the people sitting in the board room really know.

 

Terry follow the news and the stories and see if you still disagree with my view...I am only typing what is out there in the news. If it is correct or not....well

 

TWO Threads merged!