4 ms·

Every time I read about the failing American automakers, I wonder how much of their downfall can be attributed to the cost of their unionized workers' benefits

Every time I read about the failing American automakers, I wonder how much of their downfall can be attributed to the cost of their unionized workers' benefits and salaries. I heard somewhere (probably a hyperbole) that 60%+ of the cost of manufacturing a GM car can be attributed to the company's payment of pensions/retirement money. Does anyone happen to know where I can get data about this?

gibsonf1 18y ago
Toyota can use their expensive workers to do the same work in 50% of the time with 80% higher quality. That is where the real savings are.
- kingkongrevenge 18y ago
  The whole point here is that Toyota's workers are much cheaper. That's a fact.
  - Xichekolas 18y ago
    Each worker isn't much cheaper. My dad retired from GM in 2005, and the Toyota plants here in the US pay $1/hr less than he made. There is a decent discrepancy in health insurance, but not enough to totally justify the difference. The key is what gibsonf1 pointed out. Each worker at Toyota is much more productive than each worker at GM (and most likely other companies). They also benefit from a halo around them of 'superior quality'. I'm not entirely sure if a big quality difference actually still exists (it definitely did once), but in the minds of many, Toyota will always be the 'reliable choice' which allows them to charge more for their vehicles than GM can for it's equivalent. It also didn't help that GM made ugly cars for years, and even today is only marginally improving. I sincerely hope the Volt actually happens as planned, both for nerdy reasons, and because it'd be nice if GM didn't blow a golden opportunity to save itself (and my dad's retirement).
    - kingkongrevenge 18y ago
      You are overlooking retiree benefits. GM workers are much more expensive. The per car cost of current retiree medical benefits is staggering.
run4yourlives 18y ago
That is a real number. Look at GM's annual report. Sweetheart deals by unions in the 70's prior to Japan coming into the picture are a part of what is causing GM to falter. That doesn't explain their ugly ass cars though.

gibsonf1 18y ago

Toyota can use their expensive workers to do the same work in 50% of the time with 80% higher quality. That is where the real savings are.

kingkongrevenge 18y ago
The whole point here is that Toyota's workers are much cheaper. That's a fact.
- Xichekolas 18y ago
  Each worker isn't much cheaper. My dad retired from GM in 2005, and the Toyota plants here in the US pay $1/hr less than he made. There is a decent discrepancy in health insurance, but not enough to totally justify the difference. The key is what gibsonf1 pointed out. Each worker at Toyota is much more productive than each worker at GM (and most likely other companies). They also benefit from a halo around them of 'superior quality'. I'm not entirely sure if a big quality difference actually still exists (it definitely did once), but in the minds of many, Toyota will always be the 'reliable choice' which allows them to charge more for their vehicles than GM can for it's equivalent. It also didn't help that GM made ugly cars for years, and even today is only marginally improving. I sincerely hope the Volt actually happens as planned, both for nerdy reasons, and because it'd be nice if GM didn't blow a golden opportunity to save itself (and my dad's retirement).
  - kingkongrevenge 18y ago
    You are overlooking retiree benefits. GM workers are much more expensive. The per car cost of current retiree medical benefits is staggering.

run4yourlives 18y ago

That is a real number. Look at GM's annual report. Sweetheart deals by unions in the 70's prior to Japan coming into the picture are a part of what is causing GM to falter. That doesn't explain their ugly ass cars though.