Will UAW Strike?

[lilranch2001]

I guess I was lucky back in 2014 to find a STX Regular cab, they are very hard to locate!

 

[Pixguy]

I wonder if many has seen their business labor costs rise 45% in the last 5 years and able to keep their product prices affordable.

 

[jyoutz]

As a sharehol

Pricing is both-and, not either-or. Money supply is definitely a factor, more supply, higher prices. The fed actions were just tapping the brake while fiscal policy created money out of nothing (see inflation). Prices are also subject to the demand side. When people decided they wanted trucks as daily drivers (especially in situations where it was more status/ego driven than utilitarian need, prices went up on trucks. (Demand-push inflation) Costs also drive prices. Companies are not going to sell at a loss (at least not for long). There are lots of other layers involved here including CAFE standards, alternative goods and profit margin. Every 'for-profit' corporation is legally obligated to maximize returns for its stockholders.

So, hypothetically, if Ford 'sets' prices they start with a bare minimum ROI they can expect. Just for fun, call it 10%. If they cut costs per vehicle by $1000 a vehicle, they could reduce prices by about that much and still make their target ROI. If demand is up, they can still sell for the original price and increase ROI. It would be fiscally irresponsible and likely illegal for them to price below market prices. They also have finite capacity in the short-run, which artificially caps supply at X. Sure, supply and demand set the top end price, but costs go up drives the denominator. The company must do whatever it can to keep costs in line. This is especially true in a competitive market. Ford has competition and people who do not like the higher prices will buy from someone else (or used, of defer buying, etc.) If the UAW got their way, prices of the 'big 3' would go up so far that Nissan, Toyota, Honda, Tesla, etc. would take additional market share based on price. The only option the OEMs would have is to cut costs...close plants, automate, move to RTW states or overseas.

As a shareholder, of course I want reasonable rate of return, but there is debate over whether companies are legally required to maximize these returns:

Corporations Don't Have to Maximize Profits - NYTimes.com

www.nytimes.com

… analysis has shown that, contrary to the commonly held belief, directors of public companies are not under a legal obligation to maximise shareholder value …Feb 26, 2023

Legislate

Do public companies need maximise shareholder value by law? - Legislate​

 

[milkman636]

If price is set via what a market can support...why does the market fail to capture what a buyers willingness to pay is.

The market includes your company, your competitors, existing customers and potential customers. How does that market set a price? Do your competitors know something you don’t know that enables them to set a price? If not, how do they do it? And if you are simply reacting to prices your competitors set, then the market isn’t setting the price, your competitors are.

Ford and GM combined sell over a million new truck a year. With Google, Apple, Facebook, government data, lender data, market analytics, feedback from dealers, etc….., I think they have figured out what we are willing to buy. On average in my area it’s a loaded up crew cab with a giant screen, lots of buttons, big shiny wheels, low profile tires, a tiny bed, and a plush ride that sacrifices payload capacity.

The most common alternatives to these are fancy, three row, all-wheel-drive SUV things. Either way we’ve been handing them notes promising to pay an amount that should be a house payment for the next 7 years. And we can do that as long as we have access to enough money to buy the vehicle we want rather than vehicles that will simply fill basic needs.

Globalization, mergers and acquisitions have also reduced things to the point that many auto companies source components from some of the same suppliers. So component cost are similar between brands that have similar volumes and buying power.

They also buy each others cars and tear them apart in the research and testing process. Early in my career I was involved in construction of a facility for ford that did just that. They would literally buy their competitors vehicles and test them rigorously before tearing them down completely.

There is so much spending in making cars that is not UAW labor. I will always remember a meeting I witnessed with about 30 suits in it where they patted themselves on the back for changing a plastic formula in a door panel and saved $0.08 on each 4-door vehicle. The model line ran around 400,000 units a year. I did the math on that as I looked around the room and thought: yep, that savings should just about cover the cost of this meeting. They did seem genuinely pleased with themselves, though.

 

[Gale Hawkins]

Ford and GM combined sell over a million new truck a year. With Google, Apple, Facebook, government data, lender data, market analytics, feedback from dealers, etc….., I think they have figured out what we are willing to buy. On average in my area it’s a loaded up crew cab with a giant screen, lots of buttons, big shiny wheels, low profile tires, a tiny bed, and a plush ride that sacrifices payload capacity.

The most common alternatives to these are fancy, three row, all-wheel-drive SUV things. Either way we’ve been handing them notes promising to pay an amount that should be a house payment for the next 7 years. And we can do that as long as we have access to enough money to buy the vehicle we want rather than vehicles that will simply fill basic needs.

Globalization, mergers and acquisitions have also reduced things to the point that many auto companies source components from some of the same suppliers. So component cost are similar between brands that have similar volumes and buying power.

They also buy each others cars and tear them apart in the research and testing process. Early in my career I was involved in construction of a facility for ford that did just that. They would literally buy their competitors vehicles and test them rigorously before tearing them down completely.

There is so much spending in making cars that is not UAW labor. I will always remember a meeting I witnessed with about 30 suits in it where they patted themselves on the back for changing a plastic formula in a door panel and saved $0.08 on each 4-door vehicle. The model line ran around 400,000 units a year. I did the math on that as I looked around the room and thought: yep, that savings should just about cover the cost of this meeting. They did seem genuinely pleased with themselves, though.

Your $0.08 story sounds like the penny wise pound foolish saying. I can see where Tesla is shaving pennies all over the model Y yet true to stated mission they install a high end liquid cooled Full Self Driving computer system in every flipping vehicle to push data back to the Mother Ship so AI can write the FSD code going forward. The former Big 3 seem risk reverse to investing $billows today for many billions more in a few years down the road.

I live in a Tesla vacuum and it costs me $200 per month as a FSD Beta Tester to provide area data input. I need FSD to be a better driver than I am especially as I age. Next month I am doing my first solo trip in 15 years. It's 800 miles to Austin. I need function over flashiness.

 

[hiddentacocatneddih]

Fords spending how many billion on the new ford blue city TN and kentucky ?

 

[milkman636]

Fords spending how many billion on the new ford blue city TN and kentucky ?

Exactly! It’s not the assembly line worker wages that we are feeling when we shop for a new vehicle. They are a relatively small component in the big picture.

 

[Gale Hawkins]

Fords spending how many billion on the new ford blue city TN and kentucky ?

Personally I could get excited about that effort if the year was 2013.

The former Big 3 are losing the world's largest vehicle market business or more correctly have lost the world's largest car market.

Companies that aren't efficient at making EV batteries at scale and at a profit today may have lost out to China's efforts of the past 10 years. China doesn't have unlimited access to cheap oil plus smog is killing many in the cities. Moving away from fossil fuels is also a national security issue for China as it's for most nations.

Germany cut off buying cheap Russian fossil fuels and are losing their automotive building complex to China. Volvo has been a Chinese owned for years as is the case with MG and other old car names.

 

[milkman636]

Personally I could get excited about that effort if the year was 2013.

The former Big 3 are losing the world's largest vehicle market business or more correctly have lost the world's largest car market.

Companies that aren't efficient at making EV batteries at scale and at a profit today may have lost out to China's efforts of the past 10 years. China doesn't have unlimited access to cheap oil plus smog is killing many in the cities. Moving away from fossil fuels is also a national security issue for China as it's for most nations.

Germany cut off buying cheap Russian fossil fuels and are losing their automotive building complex to China. Volvo has been a Chinese owned for years as is the case with MG and other old car names.

Yep, we’re feeding a monster that is likely to crush us one day. It’s grown tremendously since being granted it’s most-favored-nation trade status in 1997.

 

[Gale Hawkins]

Yep, we’re feeding a monster that is likely to crush us one day. It’s grown tremendously since being granted it’s most-favored-nation trade status in 1997.

Plus that time frame was when GM killed off the EV1. That woke up Nissan who has had Lithium ion battery EVs on the road starting in 1997 which was 26 years ago. Elon Musk said if GM had moved the EV1 forward he would have focused more on Mars. GM was helpful by selling Musk the Fremont car factory cheap. China needed EVs in the worst way and that is why the rest of the world is looking to China today as the the world looked to Japan 50 years ago.

 

[Gale Hawkins]

Auto suppliers say if the UAW strikes more plants, it could mean the end for many

I expect EV importers are looking at the strike fallouts and potential opportunities.

 

[milkman636]

Plus that time frame was when GM killed off the EV1. That woke up Nissan who has had Lithium ion battery EVs on the road starting in 1997 which was 26 years ago. Elon Musk said if GM had moved the EV1 forward he would have focused more on Mars. GM was helpful by selling Musk the Fremont car factory cheap. China needed EVs in the worst way and that is why the rest of the world is looking to China today as the the world looked to Japan 50 years ago.

My Dad's last stint of working was as a contractor with GM in the 90's when the EV1 was developing and being rolled out. He was in his mid-late 60's at the time and working on their military vehicle programs. I would go out of my way to take him back and forth to work if I was working anywhere nearby. And I remember him specifically pointing them out to me on several occasions while we were on GM property. He surprised me at the time by being a fan of that program. His specialty was heavy vehicle suspensions, brakes, and air systems.

 

[5030]

It’s a sad statement that we are so collectively quick to label hourly people that are making things in America as lazy and literally worth-less.

Not all but some are and I've witnessed that first hand and not just in unionized auto plants but anywhere there is a unionized workforce. My ex BIL made a game out of hiding during his 8 hour shift as a Millright at J&L Steel and was proud of his theft of time when working there. Clown would go to work, sleep for 8 hours and then have a buddy clock him out after 9 so he would get an extra hour of OT every day.

When they went bankrupt, he cried like the baby he was and actually had to work after that because he went to a non union shop. He lasted about 30 days and went on disability. What a tool. Plus, he played Johnny Cash with his lunchbox and stole stuff constantly and was proud of it.

Unions protect the lazy and shiftless workers and are no longer needed today. Collective bargaining is nothing but a vehicle to protect and coddle poor workers who cannot or aren't willing to put in an honest days work for a day's pay.

I'd kike to see Fords, GN and Stellantis declare bankruptcy and reorganize non union and actually lower the new vehicle cost and kick the union to the curb. The main driving cost of new vehicles is the legacy cost and the inefficiency caused by insane union work rules.

Same applies to USPS BTW.

If USPS blew the union out and got rid of them and their insane work rules, they could ACTUALLY lower costs substantially and provide excellent and competitive service, just like UPS and Fed-Ex does.

I know, UPS IS UNION. The difference is, the union at UPS don't run the company. At the PO, it does.

I can post volumes of pages that I've personally experienced delivering steel to unionized auto plants over my almost 40 year career of delivering slit coils and rolled sheet steel to auto plants in and around Michigan, Ohio. Pennsylvania and Indiana and everyone of those plants were UAW represented and that includes unionized mills like US Steel, Inland, Weirton, Warren Consolidated, Republic, Rouge and LTV. Of course most of the domestic mills have folded, went bankrupt or got bought out and the unions are gone now and the reincarnated mills are non union and making money and of course owned by offshore entities, like Acceleor Mittal for instance. AM in Cleveland is still ASW but Mittal rules with an iron hand as in no BS or you are gone.

All I can say is, I was grateful the company I drove for was non union, but paid union scale plus and the health and welfare package was far better as well. Let me just say 35 years ago, I was averaging over 110K a year on straight time with 5 weeks paid vacation, 100% 401 match, company paid Blue Cross, Christmas bonus, birthday bonus and Passover bonus. No union dues either. You worked. if you slacked, you were gone. No one slacked either. Got a brand new conventional Western Star and a new curtainside trailer, every 2 years too. Big Cat and a 13 double over with every option.

I retired at 56 and went to work for them part time. Fully retired at 60 and been retired since. No union dues, no BS either.

What a great job and I appreciated it as did all the other 56 drivers.

 

[5030]

I know more than I should know about Fords game plan and I won't allude to it on any forum, including this one. I was made privy to it by my BIL but told not to say much, so I won't but suffice to say that when the 'rubber meets the road, Fords' is prepared to do what in needs to do to stay viable and I'll leave it at that. Said too much in previous posts that I got chastised for as it is. My BIL reads this forum, not that owns a tractor because he don't. He has a hired grounds keeper.

Fain is insane 'Insane Fain' works. What I wonder is, how long will the UAW hierarchy support Fain once the strike fund runs out of money. After all, money is the root of evil, especially when it comes to unions. They (unions) have a penchant for pizzing away funds on frivolous stuff that has no direct bearing on potential strike funding and always have. Good example is the Teamsters and the dwindling retiree pension fund.

The rank and file are all boisterous and full of themselves presently but I'm curious to see how they will be once the strike funding is depleted and they have to eek out an existence on something that don't even come close to what the make at any unionized plant today, in fact much, much less, if anything at all.

Flipping burgers at McDees or stocking the shelves at WallyWorld don't cut it for them, but it may in the end and I don't see many of the non union builders absorbing many of the unionized auto workers because those companies don't want to deal with that union attitude in the first place. It has no place there.

I am profoundly grateful that this don't impact me or my family one bit. For us, life goes on just like it did yesterday and the day before.

 

[Roric]

5030,

A lot wrong here but you stated that the firm you worked for "paid the union's scale".
Who do you think established that?

The $110,000 per year you pulled down, plus benefits in todays dollars would be more than $284,250 dollars. So maybe the UAW is not asking that much.

To worry about conglomerates hurting in the year 2023, when all financial gains bubble up to the top 1/10th 0f 1% is laughable.

But you do you, after you have locked out those that come behind you.

regards,

R

 

[milkman636]

Not all but some are and I've witnessed that first hand and not just in unionized auto plants but anywhere there is a unionized workforce. My ex BIL made a game out of hiding during his 8 hour shift as a Millright at J&L Steel and was proud of his theft of time when working there. Clown would go to work, sleep for 8 hours and then have a buddy clock him out after 9 so he would get an extra hour of OT every day.

When they went bankrupt, he cried like the baby he was and actually had to work after that because he went to a non union shop. He lasted about 30 days and went on disability. What a tool. Plus, he played Johnny Cash with his lunchbox and stole stuff constantly and was proud of it.

Unions protect the lazy and shiftless workers and are no longer needed today. Collective bargaining is nothing but a vehicle to protect and coddle poor workers who cannot or aren't willing to put in an honest days work for a day's pay.

I'd kike to see Fords, GN and Stellantis declare bankruptcy and reorganize non union and actually lower the new vehicle cost and kick the union to the curb. The main driving cost of new vehicles is the legacy cost and the inefficiency caused by insane union work rules.

Same applies to USPS BTW.

If USPS blew the union out and got rid of them and their insane work rules, they could ACTUALLY lower costs substantially and provide excellent and competitive service, just like UPS and Fed-Ex does.

I know, UPS IS UNION. The difference is, the union at UPS don't run the company. At the PO, it does.

I can post volumes of pages that I've personally experienced delivering steel to unionized auto plants over my almost 40 year career of delivering slit coils and rolled sheet steel to auto plants in and around Michigan, Ohio. Pennsylvania and Indiana and everyone of those plants were UAW represented and that includes unionized mills like US Steel, Inland, Weirton, Warren Consolidated, Republic, Rouge and LTV. Of course most of the domestic mills have folded, went bankrupt or got bought out and the unions are gone now and the reincarnated mills are non union and making money and of course owned by offshore entities, like Acceleor Mittal for instance. AM in Cleveland is still ASW but Mittal rules with an iron hand as in no BS or you are gone.

All I can say is, I was grateful the company I drove for was non union, but paid union scale plus and the health and welfare package was far better as well. Let me just say 35 years ago, I was averaging over 110K a year on straight time with 5 weeks paid vacation, 100% 401 match, company paid Blue Cross, Christmas bonus, birthday bonus and Passover bonus. No union dues either. You worked. if you slacked, you were gone. No one slacked either. Got a brand new conventional Western Star and a new curtainside trailer, every 2 years too. Big Cat and a 13 double over with every option.

I retired at 56 and went to work for them part time. Fully retired at 60 and been retired since. No union dues, no BS either.

What a great job and I appreciated it as did all the other 56 drivers.

I'm gonna throw some food for thought out here. You lived and worked in the heart of union country at a time that unions were strong. Your employer was also located there. Is it possible that he may have found it was necessary to pay very well if he wanted to attract good people and keep them from leaving for union jobs? If so, like it or not, you directly benefitted from the existence of labor unions in your area.

If those union jobs were not around, do you think your employer would have compensated you near as generously? History says the answer is no,

If look back though 20th century history, labor unions, labor laws, safety rules, and environmental laws all came into existence because of consistent patterns of abuse by companies and employers prior to external regulations. The safe and civil workplace we all expect was created through regulation and government intervention, not employer benevolence. FDR and the new deal congress were a huge part of initiating that progress.

 

[Gale Hawkins]

Those that get locked out do concern me at the age of 72 because that is the majority. Our kids are about to turn 26 and there a large number that struggle with rent and transportation. Forms of slavery still exists today for people that can't see better days through better ways. People without hope tend to shut down or act out. Both can be bad for the future of society and the individuals.

 

[Gale Hawkins]

I Talked With UAW Workers On The Picket Line In Front Of The Ford Bronco Plant. Here's What They Had To Say - The Autopian

I found this helpful coming from the troops in the trenches. I'm not sure everyone got the memo that globalization meant the higher income countries would be moving to a lower standard of living so we could pull up the lower level countries that had never met with success at the people level.

 

[milkman636]

I Talked With UAW Workers On The Picket Line In Front Of The Ford Bronco Plant. Here's What They Had To Say - The Autopian

I found this helpful coming from the troops in the trenches. I'm not sure everyone got the memo that globalization meant the higher income countries would be moving to a lower standard of living so we could pull up the lower level countries that had never met with success at the people level.

Great post.

How many of us would like to set our wages based on what people in other countries are willing to do the job for?

A guy living in India could do my job for 1/4 my pay and live large, and if I reduced my pay by 50% I'd still be 100% more expensive than him. That's not a position I want to bargain from.

 

[5030]

I'm gonna throw some food for thought out here. You lived and worked in the heart of union country at a time that unions were strong. Your employer was also located there. Is it possible that he may have found it was necessary to pay very well if he wanted to attract good people and keep them from leaving for union jobs? If so, like it or not, you directly benefitted from the existence of labor unions in your area.

If those union jobs were not around, do you think your employer would have compensated you near as generously? History says the answer is no,

If look back though 20th century history, labor unions, labor laws, safety rules, and environmental laws all came into existence because of consistent patterns of abuse by companies and employers prior to external regulations. The safe and civil workplace we all expect was created through regulation and government intervention, not employer benevolence. FDR and the new deal congress were a huge part of initiating that progress.

I agree but (BIG BUT), unions have outlived their usefulness. They were the motivating vehicle back in the 20's through 50's but today, all they are is a weight on the free enterprise system that causes companies to close their doors.

Again, YRC is a prime example. UPS agreed to the Teamsters demands but raised their package rate to offset it so it now costs you more to ship the same. See, in the end, you, as a consumer pays the freight with no choice. Same with the Post Office. First Class Stamps have increased in cost every year with no increase in services rendered. In fact quality of service has declined of anything.

The part of your comment I bolded is key to the entire 'what is going down' today.

When a company or corporation becomes so entwined with any union, that the union is dictating their very existence, it's time for one of 2 things to happen. Either the company declares bankruptcy and reorganizes as a non union entity or it ceases doing business entirely. Only 2 avenues to take.

I'll let you decide which one Fords will take. I already know but again, I'm not saying anything. Whatever Fords decides, it will be the template for the other domestic automakers as well because Fords has been 'nominated' to lead this.

The real issue is with the T2 and T3 suppliers, most of which are not union and in reality, employ substantially more worker bees than all the automakers combined and it will adversely impact their ability to supply the non union automakers with intrinsic parts as well If you think (wrongly) that Toyota or Nissan or any non union southern RTW state located auto builder builds their sub assemblies and necessary parts in house, your are totally mistaken because all of them source parts and sub assemblies from the same outfits that build for Fords, GM and Stellantis and curtailment of those parts will negatively impact their businesses, some to the point of ceasing doing business entirely and laying off masses of workers that will negatively impact the fragile economy as well.

Like Ronald Regan said... Trickle Down Economy. It's gonna trickle down right to you...and me.

Gonna let it ride for a few days and let the chips fall where they may... or may not.