http://www.cbsnews.com/stories/2008/12/17/business/main4674635.shtml
I understand that they are already billions of dollars in debt, but is this just a stunt to push congress to release bailout money?
How will this effect the workers? I do not know what the common union worker makes (3 or 4 times what most working people make), is their unemployment as inflated as their hourly wage?
Replies (7)
Grdevs24zero on 12/17/2008 18:40:32
Wow, I was not expecting that.
swez on 12/17/2008 19:39:37
This is pulling out all the stops for Chrysler to hang onto whatever cash they can to survive. The Big 3 often shutdown for the Holiday season for 2 weeks and they were paid weeks in the past. (40 hour labors rate or salaried exempts get that too.
Also, the Union has a package for laidoff workers that pays close to 80% while workers are idled. They get the health care and other benefits and can still collect UE Insurance as these benefits are paid by Union dues and other funds. (Sweet deal huh?)
UE Insurance is capped at a certain number, based on # of dependents and recorded earnings during a given calendar year. It's been a long time since I had UE benefits, but as I recall, it was capped at ~$300.00/wk with 4 depenents. (That was 10 years ago) They also adjust benefits for COLA. If the Cost Of Living Adjustment exceeds a certain threshold, the payee gets a little bump here too.
Frankly, I think this a very savvy move on the automakers' part. It will hurt the salaried and non-union folks the most. However, coming back to the bargaining table will definitely bring the union people more willing to make the needed concessions.
One number I have not seen lately, is the number of vehicles out in storage, on the lots and other inventory points. When times were good, they tried to hold a min of 90 days sellable inventory. Have no idea what that number is right now. The projected 2008 annuals sales for the Big 3 is almost 11 million units. (Just under 1 million per month)
Here's the kicker: Would you believe that a typical Union employee that's been on the job for more than 10 years, can easily make over $100,000.00 a year with some O.T.?
Yeah, they get paid that well for many low-skill jobs performed on the line. My ex-neighbor worked for the local transmission group here in town. During the good years, (Trucks and SUV's were in high demand back then) she was pulling in over $80,000.00 on straight 40 hours and with OT, more like $120,000.00
Her dad got her foot in the door and was there over 36 years as a semi-skilled Tech. He took all the OT they offered and pulled in a heavy sum each month too. (Just a SWAG guess... $160,000.00/yr?)
Finally, between you, me and the fence post, put their brain power together, turn that mass into gun powder... they did not have enough powder to blow up a bike tire!
It's all true folks! Sad, but that was reality. (No wonder the Union is fighting like Hell to keep the Status Quo) Who can blame them?
Swez
cplkittle on 12/17/2008 22:39:59
What gets me is that a retiree can easily clear 60k / year plus benefits and draw social security on top of that.
No wonder they are going broke. The unions have ridden their high horse to the ground.
Grdevs24zero on 12/17/2008 23:06:40
When the workers make more than the people buying the cars, things need to be addressed. Unfortunately, at best I think they'll get a lecture before they're given the several billion alotted for it.
Perhaps they wouldn't be in this position had they paid more attention to the complaints from the lower price point cars. Rental companies and governments may have contracts/willingness to stay American (American labeled anyway, that's another story in itself), but the open public does not. When you fail to produce in the market with the highest demand you can't possibly expect to make that money up in the less popular areas.
I'm blabbering, you guys understand this much better than I. I'm dissapointed to say that when I speak with aquaintinces outside of the US and they ask how things are going here, I'm ashamed to talk about it. Alot of dumb, dumb, DUMB decisions made by too many dumb people and alot of good people are suffering for it.
MrBrownstone on 12/18/2008 14:51:18
Stunt?
NO, they really don't have a NEED to be open if noone is buying their cars & they have a glut of inventory
Blackmailing Congress?
NO...although why should Congress care? this isn't a government issue, this is a private industry issue.
If HeyZeus Chrysler fails some other car company will pick up it's volume/revenue & everybody will be fine. The real problem is that they are unprofitable.
ttocs on 12/18/2008 20:05:53
I got a buddy that has been with chrysler for over a decade and I have always been amazed at what he had. He had a bachlors tool and di(SP?) and then used chrsler to get his mba so hopefully he is ok.
swez on 12/19/2008 00:41:27
This will be a deacade of major changes in the US Auto biz. They will send the older and high paided labor out to pasture and recruit new blood at 1/3rd the previous package payed to the 20 + year Vet.
Getting the old blood out is essential. They had their days in the sun and now things have changed considerably. These "buy-outs" are deigned to winnow out the old, expensive and less productive workers and bring in people that are happy to have a job at $12-18 bucks an hour. (Read as leave now with decent package or take your chances of getting far less later)
Yes, the new-hires and contract employees will pay for some/most of their insurance benefits and when profits return at a given point, they'll get perks too. But with an industry as large as this and the legacy costs associated with it, who can sustain such a burden for long? The obvious is written on the wall... change or go the way of the dodo bird!
I understand that they are already billions of dollars in debt, but is this just a stunt to push congress to release bailout money?
How will this effect the workers? I do not know what the common union worker makes (3 or 4 times what most working people make), is their unemployment as inflated as their hourly wage?
Replies (7)
Grdevs24zero on 12/17/2008 18:40:32
Wow, I was not expecting that.
swez on 12/17/2008 19:39:37
This is pulling out all the stops for Chrysler to hang onto whatever cash they can to survive. The Big 3 often shutdown for the Holiday season for 2 weeks and they were paid weeks in the past. (40 hour labors rate or salaried exempts get that too.
Also, the Union has a package for laidoff workers that pays close to 80% while workers are idled. They get the health care and other benefits and can still collect UE Insurance as these benefits are paid by Union dues and other funds. (Sweet deal huh?)
UE Insurance is capped at a certain number, based on # of dependents and recorded earnings during a given calendar year. It's been a long time since I had UE benefits, but as I recall, it was capped at ~$300.00/wk with 4 depenents. (That was 10 years ago) They also adjust benefits for COLA. If the Cost Of Living Adjustment exceeds a certain threshold, the payee gets a little bump here too.
Frankly, I think this a very savvy move on the automakers' part. It will hurt the salaried and non-union folks the most. However, coming back to the bargaining table will definitely bring the union people more willing to make the needed concessions.
One number I have not seen lately, is the number of vehicles out in storage, on the lots and other inventory points. When times were good, they tried to hold a min of 90 days sellable inventory. Have no idea what that number is right now. The projected 2008 annuals sales for the Big 3 is almost 11 million units. (Just under 1 million per month)
Here's the kicker: Would you believe that a typical Union employee that's been on the job for more than 10 years, can easily make over $100,000.00 a year with some O.T.?
Yeah, they get paid that well for many low-skill jobs performed on the line. My ex-neighbor worked for the local transmission group here in town. During the good years, (Trucks and SUV's were in high demand back then) she was pulling in over $80,000.00 on straight 40 hours and with OT, more like $120,000.00
Her dad got her foot in the door and was there over 36 years as a semi-skilled Tech. He took all the OT they offered and pulled in a heavy sum each month too. (Just a SWAG guess... $160,000.00/yr?)
Finally, between you, me and the fence post, put their brain power together, turn that mass into gun powder... they did not have enough powder to blow up a bike tire!
It's all true folks! Sad, but that was reality. (No wonder the Union is fighting like Hell to keep the Status Quo) Who can blame them?
Swez
cplkittle on 12/17/2008 22:39:59
What gets me is that a retiree can easily clear 60k / year plus benefits and draw social security on top of that.
No wonder they are going broke. The unions have ridden their high horse to the ground.
Grdevs24zero on 12/17/2008 23:06:40
When the workers make more than the people buying the cars, things need to be addressed. Unfortunately, at best I think they'll get a lecture before they're given the several billion alotted for it.
Perhaps they wouldn't be in this position had they paid more attention to the complaints from the lower price point cars. Rental companies and governments may have contracts/willingness to stay American (American labeled anyway, that's another story in itself), but the open public does not. When you fail to produce in the market with the highest demand you can't possibly expect to make that money up in the less popular areas.
I'm blabbering, you guys understand this much better than I. I'm dissapointed to say that when I speak with aquaintinces outside of the US and they ask how things are going here, I'm ashamed to talk about it. Alot of dumb, dumb, DUMB decisions made by too many dumb people and alot of good people are suffering for it.
MrBrownstone on 12/18/2008 14:51:18
Stunt?
NO, they really don't have a NEED to be open if noone is buying their cars & they have a glut of inventory
Blackmailing Congress?
NO...although why should Congress care? this isn't a government issue, this is a private industry issue.
If HeyZeus Chrysler fails some other car company will pick up it's volume/revenue & everybody will be fine. The real problem is that they are unprofitable.
ttocs on 12/18/2008 20:05:53
I got a buddy that has been with chrysler for over a decade and I have always been amazed at what he had. He had a bachlors tool and di(SP?) and then used chrsler to get his mba so hopefully he is ok.
swez on 12/19/2008 00:41:27
This will be a deacade of major changes in the US Auto biz. They will send the older and high paided labor out to pasture and recruit new blood at 1/3rd the previous package payed to the 20 + year Vet.
Getting the old blood out is essential. They had their days in the sun and now things have changed considerably. These "buy-outs" are deigned to winnow out the old, expensive and less productive workers and bring in people that are happy to have a job at $12-18 bucks an hour. (Read as leave now with decent package or take your chances of getting far less later)
Yes, the new-hires and contract employees will pay for some/most of their insurance benefits and when profits return at a given point, they'll get perks too. But with an industry as large as this and the legacy costs associated with it, who can sustain such a burden for long? The obvious is written on the wall... change or go the way of the dodo bird!
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