Friday morning came with the Bush Administration throwing a $17.4 billion lifeline to GM and Chrysler. Ford Motor Company has been restructuring and said that it didn’t need immediate help.
Thank you, President Bush. Thank you because 2.5 to 3 million folks in Michigan were holding their breath all week. I could hear the exhale, and following inhale all the way here in Pennsylvania on Friday.
This infusion of cash is not going to stop all of the bleeding. There will be suppliers who will close because they don’t have the cash reserves to keep going until GM and Chrysler pay their bills. But for the majority of folks out there, they can see some light at the end of the tunnel.
And hopefully it isn’t another train coming at them. Both Management and the UAW have to look at what has been given them and make some hard decisions. Who should get paid what is the first one that needs to be made. I read somewhere, and I can’t cite it right now but I will later, that Japanese execs make 4-5 times more than their lowest paid employee. Not here in the US, of course, but in Japan. US execs make over 100 times their lowest paid employees. Stop and think about that for a minute.
Everyone likes to have money, and live in a nice house, and do the things that they want to do, when they want to do them. I know that I do. But if your company is cash strapped, wouldn’t it be prudent to give in on some salary and benefits rather than not have a job? Don’t cite the $70-$100 hourly wages being made by UAW members. It doesn’t happen. But the point is that both sides of the bargaining table are going to have to pony up to keep Detroit alive.
The UAW always says that Management is the problem, taking all of the cream and leaving them with crumbs. Management says that the bargaining unit wants blood from a turnip. Blah, blah, blah. Both sides need to figure out whether they want to be employed or on the dole. And they need to figure it out soon, as there is a glut of cars in the market. New cars that haven’t been sold because very few people who CAN get loans are going to buy from a company going out of business. And folks like me, who own foreign vehicles , aren’t going to head back to Detroit rolling iron if they can’t make reliable vehicles that don’t last.
Yeah, I drive a toyota as compared to MLW’s Chevy. Her engine blew at 82,000 miles. My engine has 256,000 miles on it with only having to replace an EGR valve. Her heater core had to be replaced at 90,000 miles, all I have had to do to my vehicle is to recharge the AC every couple of years. Given that kind of performance, what vehicle would you buy?
So. GM, Chrysler, and the UAW have an opportunity here. Hopefully they can get beyond themselves and not screw it up.
Namaste.
