What Toyota knows that GM doesn’t

[ejp626]

  The Magnificent Goldberg said:

As I've said before - even in this thread, I think - there comes a time when it is realised that the balance between unions and management is wrong and adjustments have to be made. They were in Britain. And yes, it bloody well hurt. Mrs Thatcher used to say, "if it isn't hurting, it isn't working," but she was gloating because she just hated the unions anyway. But we got over it after twenty or so years

I would be a lot more inclined to agree with you if upper management ever took a hit, but they don't and never will as far as I can tell. So Thatcher broke the unions and the miners and now you have an anemic labour movement (and how Labour can justify calling itself Labour is beyond me when Blair gloated about keeping the unions under his heel). And to what end? Manufacturing has still left the UK. You've moved to a service economy. Vast stretches of the country have low standards of living.

The question for me is whether this really was inevitable, either in the UK or the US. Certainly the economists like to claim it is, and that adhering to an industrial policy is just protectionist. I think the findings are clear that overall countries are better off with lower trade barriers and without tariffs. However, the US and to a lesser extent the UK are so lousy about spreading the benefits of globalization around (rather than letting them accrue to the top 5%) that I think maybe we would have been better off following the protectionist path. If things get much worse economically, we will probably try it eventually and maybe it would have been "better" to have done it while unions still existed.

[catesta]

  The Magnificent Goldberg said:

  catesta said:

The imports have never had the union around their neck (for the right or wrong reasons) in fat or lean times. GM, Ford and Chrysler cannot say the same.

I don't think that's true, Chris. British manufacturers had all the same sorts of problems with their unions as the big three have with theirs. (OK, few British cars were in the same market as the big three - some luxury cars and sports cars did well in the US, but the bread and butter British cars weren't suitable for the US market.) And the biggest British firm is now out and has been for the best part of a decade. I am pretty certain that the same union problems applied to continental manufacturers.

As I've said before - even in this thread, I think - there comes a time when it is realised that the balance between unions and management is wrong and adjustments have to be made. They were in Britain. And yes, it bloody well hurt. Mrs Thatcher used to say, "if it isn't hurting, it isn't working," but she was gloating because she just hated the unions anyway. But we got over it after twenty or so years

I don't know if you can get this link

http://www.statistics.gov.uk/statbase/TSDdownload2.asp

edit - no, you can't I just tried it.

It's a series of stats about the number of days (in thousands) lost in Britain through industrial disputes - annually from 1891 to 2007 and monthly from 1931 to September 2008. You'll see a big reduction after the early eighties. Which is not to say that there are no strikes; as Jim says, not all firms act reasonably; not all unions act reasonably. So there is still conflict, but at a very much lower level now, and more legal incentives for negotiation and better ways of handling negotiation now. You need all these things - not just a bash at the unions. But if government can put in place an all-round new deal that encompasses negotiation as well as reducing the unions' power, it seems it can work.

MG

MG, I was referring specifically to the foreign manufacturers with non-union plants in the U.S.. I should have made that more clear.

[The Magnificent Goldberg]

  ejp626 said:

The question for me is whether this really was inevitable, either in the UK or the US. Certainly the economists like to claim it is, and that adhering to an industrial policy is just protectionist. I think the findings are clear that overall countries are better off with lower trade barriers and without tariffs. However, the US and to a lesser extent the UK are so lousy about spreading the benefits of globalization around (rather than letting them accrue to the top 5%) that I think maybe we would have been better off following the protectionist path. If things get much worse economically, we will probably try it eventually and maybe it would have been "better" to have done it while unions still existed.

You're wrong in relating the lowering of tariffs and barriers to the increasing inequality in Britain and the US. You can have one without the other. And having increasing inequality is no reason to have trade barriers.

One of the problems that Britain has in terms of preventing inequality from rising inexorably is the fact that you all speak English (more or less ) and that it's therefore very easy for a brain drain from Britain to America to develop; much easier than from other countries. Our Government has just proposed a 45% tax rate for earnings above about £150,000 a year, and there are already predictions of a huge brain drain arising. So effectively, our taxes have to be set in the knowledge of what yours are and adjusted so as to mimimise this effect. But that leads to greater economic inequality.

MG

[The Magnificent Goldberg]

  catesta said:

MG, I was referring specifically to the foreign manufacturers with non-union plants in the U.S.. I should have made that more clear.

Oh right. But those manufacturers do recognise British unions, by the way. So it looks as if what they're saying is not that they're against unions, but against your type of unions.

MG

[ejp626]

  The Magnificent Goldberg said:

You're wrong in relating the lowering of tariffs and barriers to the increasing inequality in Britain and the US. You can have one without the other. And having increasing inequality is no reason to have trade barriers.

They are different issues, but still linked in this sense. If we look to the US at the most successful expansion of the middle class which took place from roughly 1950 through 1970s, this was largely due to government policies that expanded educational opportunity, as well as a system of official and unofficial policies that allowed working class folks to share in the middle class lifestyle (suburban housing, etc.). This was only possible because a vibrant manufacturing sector supported this lifestyle. Sure there was growth in the white collar occupations, and kids that took advantage of increased educational opportunities made that move.

Now manufacturing has been hollowed out, and there are very few things that will replace it. Those that made it up the ladder in time into a slightly enlarged professional class have benefited by all the global changes in the economy. Those that were left behind have moved into very transitory service type jobs. (This is sort of a synthesis of Reich's Work of Nations though he isn't quite as class conscious as I would like.) The goal of course is that we all suddenly upgrade our skills (becoming IT engineers I guess) and thus leaving manufacturing to others will result in everyone being better off. Well, of course that is a pretty fantasy but is clearly a false one, and we pay almost no attention to those left behind by increased competition. In any case, if a dispassionate study showed that removing trade barriers accellerated wage inequality, then I think it would be worth revisiting the issue. My feeling is that we (the US) did go too far in outsourcing the bulk of our manufacturing capacity, and the benefits of free trade are often overstated and certainly not distributed in such a way to make up for the serious pain inflicted upon blue collar workers.

[Jazzmoose]

  catesta said:

There was a time and need for the union, but in my opinion that time is over. People are beginning to figure that out. It's obvious when you look at how the amount of dues paying members keeps shrinking. The UAW keeps making runs at Subaru, Honda and Toyota and the door keeps slamming in their faces.

Bullshit. Five days after unions disappear, they'll be needed again.

[catesta]

  Jazzmoose said:

  catesta said:

There was a time and need for the union, but in my opinion that time is over. People are beginning to figure that out. It's obvious when you look at how the amount of dues paying members keeps shrinking. The UAW keeps making runs at Subaru, Honda and Toyota and the door keeps slamming in their faces.

Bullshit. Five days after unions disappear, they'll be needed again.

Today's UAW? I doubt it.

[Chuck Nessa]

  catesta said:

  Jazzmoose said:

  catesta said:

There was a time and need for the union, but in my opinion that time is over. People are beginning to figure that out. It's obvious when you look at how the amount of dues paying members keeps shrinking. The UAW keeps making runs at Subaru, Honda and Toyota and the door keeps slamming in their faces.

Bullshit. Five days after unions disappear, they'll be needed again.

Today's UAW? I doubt it.

The only reason Honda/Nissan/Toyota workers are happy is courtesy of the UAW, not their employers.

[Jazzmoose]

  catesta said:

  Jazzmoose said:

  catesta said:

There was a time and need for the union, but in my opinion that time is over. People are beginning to figure that out. It's obvious when you look at how the amount of dues paying members keeps shrinking. The UAW keeps making runs at Subaru, Honda and Toyota and the door keeps slamming in their faces.

Bullshit. Five days after unions disappear, they'll be needed again.

Today's UAW? I doubt it.

Obviously, if unions disappear, that would include today's UAW. But a new union would soon arise, because you can bet your ass the rollback that some would love to see wouldn't stop at just eliminateing unions, but getting rid of nasty things the unions brought, like the 40 hour week, those unfair child labor laws, etc. Though I'm sure the same people who championed the great idea of unregulated financial markets would pooh-pooh my concerns as unrealistic and paranoid, but we've seen what the world looks like without unions, and in a capitalist society, it looks strangely similar to slavery.

Edited November 26, 2008 by Jazzmoose

[JSngry]

  Chuck Nessa said:

  catesta said:

  Jazzmoose said:

  catesta said:

There was a time and need for the union, but in my opinion that time is over. People are beginning to figure that out. It's obvious when you look at how the amount of dues paying members keeps shrinking. The UAW keeps making runs at Subaru, Honda and Toyota and the door keeps slamming in their faces.

Bullshit. Five days after unions disappear, they'll be needed again.

Today's UAW? I doubt it.

The only reason Honda/Nissan/Toyota workers are happy is courtesy of the UAW, not their employers.

Yessir!

Let's hear it for the benefits of competition!

[Guy Berger]

  The Magnificent Goldberg said:

  ejp626 said:

The question for me is whether this really was inevitable, either in the UK or the US. Certainly the economists like to claim it is, and that adhering to an industrial policy is just protectionist. I think the findings are clear that overall countries are better off with lower trade barriers and without tariffs. However, the US and to a lesser extent the UK are so lousy about spreading the benefits of globalization around (rather than letting them accrue to the top 5%) that I think maybe we would have been better off following the protectionist path. If things get much worse economically, we will probably try it eventually and maybe it would have been "better" to have done it while unions still existed.

You're wrong in relating the lowering of tariffs and barriers to the increasing inequality in Britain and the US. You can have one without the other. And having increasing inequality is no reason to have trade barriers.

My view as well. Globalization is giving us a bigger pie, we are just doing a terrible job of slicing it in an equitable way. Unfortunately, many of the people who've been pushing for a larger pie don't really seem to care about that second half of the equation, so we're risking a return to small-pie policies.

Guy

[Chalupa]

U.A.W. Makes Concessions in Bid to Help Automakers

http://www.nytimes.com/2008/12/04/business...9aZJ25FmcToq62w

[The Magnificent Goldberg]

Thanks for the link. This

  Quote

“We’ve helped them before, but it seems like they always come back to us,” said Shane Colvard, chairman of Local 2164 in Bowling Green, Ky., where G.M. builds the Chevrolet Corvette sports car.

has the ring of unvarnished truth, however.

MG

[Jazzmoose]

The UAW has made many concessions over the past few years, but of course that doesn't fit into the "it's all the union's fault" theory so it is ignored. Frankly, it makes me sick when I hear top management of these companies laying the blame all on the unions. If the unions are in charge, why are these weasels getting hundreds of millions of dollars?

[BruceH]

  Jazzmoose said:

  catesta said:

  Jazzmoose said:

  catesta said:

There was a time and need for the union, but in my opinion that time is over. People are beginning to figure that out. It's obvious when you look at how the amount of dues paying members keeps shrinking. The UAW keeps making runs at Subaru, Honda and Toyota and the door keeps slamming in their faces.

Bullshit. Five days after unions disappear, they'll be needed again.

Today's UAW? I doubt it.

Obviously, if unions disappear, that would include today's UAW. But a new union would soon arise, because you can bet your ass the rollback that some would love to see wouldn't stop at just eliminateing unions, but getting rid of nasty things the unions brought, like the 40 hour week, those unfair child labor laws, etc. Though I'm sure the same people who championed the great idea of unregulated financial markets would pooh-pooh my concerns as unrealistic and paranoid, but we've seen what the world looks like without unions, and in a capitalist society, it looks strangely similar to slavery.

You're just down on the whole "Gilded Age" thing.

[Rooster_Ties]

Link: It was a dead heat. General Motors sold 9.37 million vehicles worldwide in 2007 and LOST $38.7 billion. Toyota sold 9.37 million vehicles in 2007 and MADE $17.1 billion.

  Quote

It was a dead heat. General Motors sold 9.37 million vehicles worldwide in 2007 and lost $38.7 billion.

Toyota sold 9.37 million vehicles in 2007 and made $17.1 billion.

That was the second best sales total in GM's 100-year history and the biggest loss ever for any automaker in the world.

For Toyota, that was roughly $1,800 in PROFIT for every vehicle sold. For GM, it was an average LOSS of $4,100 for every vehicle sold.

Edited December 10, 2008 by Rooster_Ties

[catesta]

  Rooster_Ties said:

Link: It was a dead heat. General Motors sold 9.37 million vehicles worldwide in 2007 and LOST $38.7 billion. Toyota sold 9.37 million vehicles in 2007 and MADE $17.1 billion.

  Quote

It was a dead heat. General Motors sold 9.37 million vehicles worldwide in 2007 and lost $38.7 billion.

Toyota sold 9.37 million vehicles in 2007 and made $17.1 billion.

That was the second best sales total in GM's 100-year history and the biggest loss ever for any automaker in the world.

For Toyota, that was roughly $1,800 in PROFIT for every vehicle sold. For GM, it was an average LOSS of $4,100 for every vehicle sold.

And now.....

TOKYO — The Toyota Motor Company, the world’s largest automaker, said Friday that it expected its full-year operating loss to be three times bigger than its previous forecast, and also said it expected its first net loss since 1950.

Toyota, which had not previously forecast a net loss, said it expected to lose 350 billion yen, or $3.9 billion, across its operations during the 2008 fiscal year, which ends in March.

It widened its forecast for an operating loss on its main automotive business to 450 billion yen, or $5 billion.

Full Story Here

[Jim Alfredson]

All the car companies are hurting now because demand is almost non-existent. So Toyota lost $3.9 billion. How much did Ford lose last year? Or GM?

[Guy Berger]

I guarantee that whatever Toyota loses, GM will dwarf. One company is positioned for success once the global economy recovers, the other is pinning its hope on dollops of taxpayer money and a car which doesn't even exist.

Guy

  catesta said:

  Rooster_Ties said:

Link: It was a dead heat. General Motors sold 9.37 million vehicles worldwide in 2007 and LOST $38.7 billion. Toyota sold 9.37 million vehicles in 2007 and MADE $17.1 billion.

  Quote

It was a dead heat. General Motors sold 9.37 million vehicles worldwide in 2007 and lost $38.7 billion.

Toyota sold 9.37 million vehicles in 2007 and made $17.1 billion.

That was the second best sales total in GM's 100-year history and the biggest loss ever for any automaker in the world.

For Toyota, that was roughly $1,800 in PROFIT for every vehicle sold. For GM, it was an average LOSS of $4,100 for every vehicle sold.

And now.....

TOKYO — The Toyota Motor Company, the world's largest automaker, said Friday that it expected its full-year operating loss to be three times bigger than its previous forecast, and also said it expected its first net loss since 1950.

Toyota, which had not previously forecast a net loss, said it expected to lose 350 billion yen, or $3.9 billion, across its operations during the 2008 fiscal year, which ends in March.

It widened its forecast for an operating loss on its main automotive business to 450 billion yen, or $5 billion.

Full Story Here

[danasgoodstuff]

man, I gotta get me one of them bumper stickers - BAIL OUT STUDEBAKER!

seriously, the disparity in profit or loss on the same total of sales is due the same stuff that brought down the pride of South Bend, old plant(s), high labor, large pensioners relative to current work force, and Studebaker had to deal with amortizing developement costs on production that struggled to make six figures and often failed...but it was that struggle that lead them to make cars I love, eg when the board pulled the plug on the main plant in Dec '63 they were making the fastest production car in the world, the R3 Avanti, all 9 of them! GM's efforts, given their still far greater resources, are less impressive. The difference is that Studebakers demise (not really, they just got the hell out of the car business and survived, saving the shareholders' shirts before being eaten up in mergers) only devasted South Bend, which they had effectively subsidised for decades...and yes, Stude people are still debating all this, as I'm sure the curent bailout will be controversial forever, whatever happens...

[danasgoodstuff]

i forget to add my fav business theory - all businesses fail, it's just a question of when...

and it really is possible ti see the whole world thru the prism (prison?) of your own particular brand of underwater basketweaving....

[Jazzmoose]

At least GM is smart enough to get rid of those pesky Saturns that people seem to like and want to buy...

http://www.washingtonpost.com/wp-dyn/conte...news&sub=AR

GM to Sell Saturn Franchise to Penske

General Motors announced this morning that it will sell its Saturn franchise to Penske Automotive.

GM and Penske did not disclose how much Penske is paying for the brand.

GM said the deal will save more than 13,000 jobs, preserve the "renowned brand" and keep Saturn's 350 dealers in business.