Did Detroit Kick A Sleeping Giant?

Frank Williams
by Frank Williams
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did detroit kick a sleeping giant

BusinessWeek's Ed Wallace thinks U.S. automakers– both indigenous and transplanted– better watch out for the UAW. While GM and Chrysler are dancing a jig over unloading retiree health care and cutting wages, he foresees aftershocks in a few years. Wallace points out that retired members of the United Auto Workers (UAW) don't get to vote on contracts. As active members (who voted for the two-tier wage structure) retire, as they're replaced with lower-tier workers, a "younger worker might well feel cheated and resentful, doing the same job for maybe half what someone else was paid to do it just five years earlier." Wallace thinks this seething resentment wage and benefit disparity will combine with a backlash from transplant workers facing lowered wages to stimulate a UAW "comeback." In other words, the deal Detroit's celebrating today could bite them in the ass tomorrow– in, say, four years. Should they be around to experience the backlash, The Big 2.8 will claim they never saw it coming.

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  • Landcrusher Landcrusher on Nov 05, 2007

    Unfortunately, Shwartz is correct from my experience watching the death of IT companies. If you want to save any of the traditional American manufacturers, you need to figure out how to get from where we are now to where we need to be faster than anyone else. In the long run, robots will be building all our cars. Productivity will meet an extreme where the only "manufacturing jobs" involved are those fixing and supervising the robots (service jobs). Once again, while our automotive leaders are all spending their careers on ridiculous labor issues, the japanese are getting ahead. We have shown an ability to win competitions involving innovation and hard work. Unfortunately, as I have opined in the past, the 2.x lack the leaders able to take the companies forward because those people are being weeded out rather than home grown.

  • RobertSD RobertSD on Nov 05, 2007

    My apologies, Ryan, but, in my defense, it still does not match the $28/hour getting dished out to the UAW top-tier. And under the two-tier plan, that Honda number is right in line with the lower tier systems being set up at GM, Cerberus and Ford (and Honda's benefits will still trail the Big 2.5). So, I think my original point - even if it was exaggerated - still stands.

  • Morbo Morbo on Nov 05, 2007

    Who needs humans? Bender (from Futurama) sounds perfect for bending the frames of Dodge Caliber's. Don't like it, "kiss my shiny metal ass!". Seriously though, doesn't Hyundai build 250,000 cars annually in Alabama with under 1,000 workers in that plant? I read somewhere that the only actual manufacturing humans do is installing the dashboards; apparently the robots are quite dextrous enough for that. Otherwise, from metal framing to final assembly drive off, it's all automated. The future is now, and as a shock to someone who remembers the 1991 Excel, it's at Hyundai. Now, so long as the robots don't unionize...

  • Mikey Mikey on Nov 05, 2007

    Morbo: Have you got the source of those figures.Maybe they are assembling a lot of pre assembled components. 1000 people building over a 1000 cars a day? Iv'e seen some of the most advanced robots in the world operate.There is no way robots are gonna build a car from scratch. Auto workers and unions are gonna be around for a while yet. Honda and Toyota have treated thier people with respect and dignity.If they can continue doing what thier doing they won't have to worry about the unions. Make no mistake folks,the UAW has given the big 2.8 a new lease on life. Management has the ball now run with it,and they might stay in the game.Drop it, and its game over. If they lose,mangement has only thier own incompetant asses to blame. Ron Gettlefinger might just be the guy that saves the American auto industry.