Do auto workers really earn $73 an hour?

[ChemEng]

The short answer is no. But I am amazed that a Union autoworker salary is $40/hour. I would venture that places them at least in the top 10% of government salaries and in a much higher percentage when compared to the US average salaries. Insane!

Scott
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The New York Times debunks the claim that the Big Three auto workers earn $73 an hour. That number came from the car companies themselves during union negotiations, writes David Leonhardt.

But it isn't completely accurate. Yes, the companies do spend about $73 for every hour of unionized work, Leonhardt writes. Not all of that goes to the worker's pocket.

Here's how it breaks down:

Cash: All the basics -- wages, overtime and vacation pay -- add up to $40 an hour.

Extras: Health insurance and pension costs total about $15 an hour.

Retiree benefits: These are fixed costs, and the Big Three have a huge pool of retirees out there, Leonhardt writes. They add up to about $15 an hour.

So the true hourly salary for a union worker is about $55. That's about twice what the typical American worker makes. And it's about $10 more than what a nonunionized worker at Honda or Toyota makes, Leonhardt writes.

"There is good reason to keep GM and Chrysler from collapsing in 2009. (Ford is in slightly better shape.) The economy is in the worst recession in a generation. You can think of the Detroit bailout as a relatively cost-effective form of stimulus. It’s often cheaper to keep workers in their jobs than to create new jobs."
​

But, he adds, the Big Three will have to get smaller to survive.

 

[McDuck]

> "Last year’s concessions by the United Automobile Workers, which mostly apply to new workers, will not change that anytime soon."

Two-tier employment system are very bad. "Equal pay for equal work !"

 

[Bullitt]

Chem,

Fear not, the days of overachievement are soon to come to an end. Shoot, $30 an hour, what's that, the equivalent of a GS13's level of pay for us Fed's? And that's average!

I've always wondered why everyone cares so much about the one or two corporate jets and couple hundred CEO bonuses when you've got thousands of guys making fortunes on the line every day. Let's be honest here.

 

[ChemEng]

I've always wondered why everyone cares so much about the one or two corporate jets and couple hundred CEO bonuses when you've got thousands of guys making fortunes on the line every day.

I would argue your definition of work also. Most of their jobs now are highly automated requiring very little thought or active involvement. My job pays me more when I do more, not the opposite.

 

[nnuut]

$71 includes benefits!!! Many Government workers get more than that including Benefits so be advised If they can do it to them who's next?

 

[roskopfm]

I agree with Senate Republicians. There should be no deal unless UAW employees make major concessions such as get their labor & benefits in line with Toyota and other Japanese companies. What also get me laughing is that people dont realize what a true American car is. Toyota's cars as a whole make 58% of the car in the US, much higher than GM. Toyota has one car that is more than 80%. Now which is the American car?

 

[Silverbird]

Yes, but Toyota, BMW and the others do the bulk of their Research and Development and have their high level execs outside of the U.S., and their execs and specialists make LESS than the US version. Making GM, Chrysler, and Ford Excecutives and high skilled workers (white collar) to take the same concessions as their overseas counterparts (whisper no health benefits and no big executive pay for you!) is ludicrous. However, that's what the line workers are being asked to do. Not asking the white collar, non-union workers in GM, Chrysler and Ford not to take on concessions as well until they reach whatever "competitive" is when the line guys are supposed cut their wages until they are "competitive" (whatever that means) to makes absolutely no sense. The white collars ARE supposed to be the brains of the operation, after all, and the operation of the Big 3 have been missing in the Vision department of late, so if you want to blame the workers, it needs to be Management, Design Engineering, and the other supposedly "smart guys" (in quotes because some are women).

Assembly plants, bah. That's not much for all those concessions those states gave the foreign companies. Meanwhile the home countries of the non-US companies are all too willing to help "their" companies. And what do we do? Lend out $350 billion to the Fairy Money people, as if their new investment ideas were worth saving.

 

[James48843]

IN the 2007 contract, UAW assembly skilled workers make $28.12 an hour. New hires make $14 an hour. In addition, UAW assembly skilled workers get health insurance, for which they contribute $600 per year (single), or $1,000 per year (family), plus dental and vision. And GM pays $1 per hour towards their 401(k) plan.



Here is a link to the actual contract. http://www.uaw.org/contracts/07/gm/gm02.php

They got a .17 cent raise for 2008, are scheduled to get .20 cents more for 2009, .20 cents more for 2010, and .16 cents more in 2011.

New hires get $14. New hires do not get health insurance until they've worked at the company for one year. They get dental coverage, and a vision exam after three years, and full vision coverage after five years. They get a separate 401(k) style retirement plan that GM contributes 6.4% towards, they do not get any defined benefit pension.

For pensions, current GM employees with more than 30 years of service get $66.70 per year employed. For example, an autoworker who worked 35 years would get a monthly pension check of $2334.50. From that, the retiree has to pay $22 a month towards medical insurance, and retirement is taxable. It is a fixed income- doesn't change with inflation like federal pensions do.

Complete UAW contract is here:

http://www.uaw.org/contracts/07/gm/index.php

The figure of $73 an hour is thrown around by company MGT and republicans, who say transplant workers get a lot less. That's true. Toyota and Honda don't have many retirees- most have not yet worked 30 years for Toyota and Honda. And both those companies routinely fire employees between 15 and 20 years of service, so that they don't have to pay retirees. Toyota and Honda also have about a third of their workforce identified as "temporary employees", so they don't qualify for any benefits.

Check out the contract for yourself and see who is telling the truth on those numbers.

 

[Buster]

What Auto CEOs Should Have Said
Did it occur to anyone else that those oh-so-painful auto CEO/government hearings should have been the other way around?

Instead of the heads of America's three remaining automakers groveling, begging and enduring live public floggings trying to sell their case for government loans to get them past the global economic crisis and credit freeze that government greed, corruption and incompetence has created, shouldn't they have been vein-popping outraged and angry? Shouldn't they have pointed accusatory fingers at that sorry collection of arrogant, auto-ignorant Senators and Congressmen who got them into this mess and demanded their assistance?

Shouldn't they have looked those pompous public-trough pinheads straight in the face and demanded to know why investment firms, banks and big insurance get hundreds of billions of taxpayer bailout dollars no questions asked while what's left of America's once-mighty manufacturing muscle begs for loans totaling 1/28 of that initial $700 billion Wall Street bailout? Where were the public humiliation hearings and newly viable business plans for those guys?

Here is what I'll bet those long-suffering auto CEOs wanted to say, but couldn't:

"You ignorant morons! How dare you accuse us of building cars nobody wants? We sold 8.5 million vehicles in the US last year and millions more around the world. GM still handily outsells Toyota here, Ford outsells Honda and Nissan, and Chrysler sells more than Nissan and Hyundai combined. H ow many of our new cars have you driven lately? How many quality surveys and plant productivity reports have you reviewed? Have you bothered to check your own EPA's fuel economy ratings?

"Have you paid any attention in the last several years as we've turned our companies upside down, closed dozens of plants, shed hundreds of thousands of hard-working people who did nothing to deserve it, canceled slow-selling models and spent billions of hard-earned dollars redesigning the rest? Are you idiots even aware that we renegotiated our union contracts last year to make our US labor and health-care costs fully competitive by 2010?

"Would you recognize a good business plan if one smacked you upside the head? Have any of you ever run a business, made a business decision or even held a real job? Is there any more dysfunctional organization on the planet, any that more desperately needs a new business plan, than the US Congress? Let's compare our public approval ratings to yours .

"You scold us for using private aircraft? We run global companies flying people, parts and equipment all over the world every day. We use private planes for security and productivity and cost savings over commercial alternatives. If it were not cost effective, we would not do it, and we've been doing a lot less of it lately. Tell us, Ms. Pelosi, how much does that big private 757-200 of yours cost taxpayers to fly you home and back between your tough 3-day weeks?

"For decades, your national energy policy has been summed up by two words: 'cheap gas.' Now you want to punish us for building the big, capable, comfortable vehicles Americans wanted to take advantage of that policy...and for not building millions more smaller, more fuel-efficient cars that, until recently, almost no one wanted, and that we can't make a buck on if we build them here thanks to the high business costs you've imposed upon us through the years.

"You have blocked every avenue of domestic e xploration and construction that could lead to eventual energy independence, preferring instead to pump hundreds of billions of dollars overseas to purchase the energy Americans need, much of it from countries that are not our friends. You have piled billions of dollars of unrecoverable costs on us with excessive taxation, overkill regulation and relentless litigation that our off-shore competitors do not have to bear. Then you have rolled out the red carpet to predatory, low-cost foreign competitors who come here to take our market and pump hundreds of millions more dollars out of this country.

"Is there any other country fortunate enough to have an automotive industry that does not support, protect and nourish it in every possible way? We are the only nation on earth too blind and stupid to recognize and treasure the enormous economic and national security advantages of having its own healthy, prosperous auto industry and manufacturing base.

"Now you have passed an enormously expensive new regulation requiring 40 percent higher corporate average fuel economy in hopes of someday reducing the less than 0.2 percent of global human-sourced CO2 attributable to US light vehicles. That will cost us an estimated $100 billion, and even if you believe that is really worth doing at such a cost, where are we going to get that kind of money? Talk about unfunded mandates!

"With recent resizings and restructurings and our new labor contracts, we were well on our ways to full financial competitiveness and profitability. We could have survived and the sudden $4 gas explosion - not our fault - that shifted buyer demand overnight from larger, more profitable vehicles to small unprofitable ones. We have millions of highly desirable, much more fuel-efficient small cars and engines in the pipeline for 2010 and beyond.

"Then came your mortgage meltdown and fast-frozen credit crisis, which no one in this credit-driven business can survive un aided for long: not us, not our suppliers, not our many thousands of independent dealers, not even our most cash-rich foreign competitors. They, too, are asking their governments for assistance. Will they get it? Of course! No other nation will stand idly by and watch its auto industry die.

"There was no end of election rhetoric about creating new jobs. How about saving several million of the ones we have? Can any of you begin to understand how this industry is a huge, fragile, interdependent house of cards? If GM should fail, or declare Chapter 11, so will most of its 3,690 suppliers, beginning with the 2,000 in the US that operate 4,550 facilities in 46 states. Since most also supply key components to everyone else, that will bring down all of us, including US transplant production. Don't believe us? Ask Toyota.

"Vehicle assembly, engine, transmission and parts plants nationwide will shut down. Have you seen a plant town whose plant has died? It's a jobless ghos t to wn whose out-of-work residents, including owners and employees of the small businesses that depended on plant workers' incomes, can't afford to move because their homes – like their hopes and dreams – are worthless. How many of those communities will be in your states and districts? US dealers of all brands, with no new cars, credit or credit-worthy customers, will drop like flies. Without once lucrative auto advertising, many media will shrink and some will die? The predicted initial loss of 3 million jobs will be just the beginning. Can you spell depression?

"Yes, we have lost a lot of market share. Where did you think all those millions of cars and trucks our foreign competitors import and assemble here in taxpayer-subsidized plants in cheap-labor states would be sold, and out of whose hides did you think they would come?

"Yes, we have made mistakes, some bad products and bad business decisions in the past. And so has every one of our competitors. We are entir ely d ifferent companies today with new leadership and new priorities. We have wide varieties of high quality, high fuel efficiency, highly desirable new products that Americans, as they get to know them, absolutely do want to buy. Why continue to punish us, and the millions of incredibly dedicated, hard-working people at all levels who still depend on us to feed their families, for the sins of our predecessors?

"Why punish the entire country and millions in other countries as well? If you can think of any good reason, we would like to hear it. And don't come back at us with your usual name-calling, finger-pointing, blame-shifting, uninformed opinions, decades-old perceptions and self-serving, grandstanding rhetoric. We have offered our business plans and all the facts behind how we got here and why we need and deserve to survive and prosper for the good of this country and every citizen in it.

"You know full well that this life-threatening position you have put us in to is entirely your fault, not ours, and that our future viability depends completely on you. We're anxiously awaiting your business plan for guiding this country out of the economic morass you have created, beginning with the bridge loans we desperately need."

 

[nnuut]

Someone is slowly destroying the MIDDLE CLASS!!!
Say MANFACTURING three times!!! Where did it go, who's at fault?
POLITICATIONS, that's who!!!! :nuts:

 

[eccougar]

I retired from GM over 8 years ago and was making a little over $21.00 per hour. We had full coverage on health benefits and 401k with no matching funds.
When I retired I received over $2200.00 a month pension. Then I starting receiving Social Security and my pension was cut almost in half, reverting to years of service.
I now pay some toward my health coverage, with a yearly deductible, its not near the coverage I had before. Starting in January my wife(postal worker) is getting her own insurance, because under mine we have to pay full doctor office visits and with the deductible and prescriptions.
I naturally drive GM cars and have good success with them. I had a 99 Buick Regal with over 110,000 and 3 years ago, I gave it to my daughter and she is still driving the car.
I now have Buick Lacrosse with almost 40,000 miles on it with no trouble at all, getting over 31 mile per gallon on the road. GM makes a lot of cars that get 30 mile per gallon and their quality is a lot better than in 80's and 90's.
With all the high price electronics built overseas and much more of everything else, I just hate to see the we have to depend on foreign car makers for all our automobiles and see profits keep going back overseas.
I read an article couple weeks ago, stating that with profit sharing the Toyota employees at Georgetown, Ky. make about the same per hour that GM employees make.
As James stated UAW gave a lot of concessions in 2005.

 

[nnuut]

That my friend is NOT excessive compensation!!!!!:nuts:

 

[clester]

These CEO's are liars! You can't trust them, congress, or wall street. Don't fall for the mis-information. Thanks to the ones who found the real truth. I never believed in the $73 number.

 

[jon]

Congress (mostly Repubs) were right to grill the Big 3 about getting lean and mean. They need to quickly cut product lines, plants and even more salary and possibly retirement benefits. Fortunately our govt hasn't figured out how to replace Fed ees wholesale with foreign workers, like car companies can. But consider all the private contractors in Iraq.

Congress completely folded on the $700 bil bailout. Now one of the most inept administrations in history is trying to repeat that blunder with a Kar czar. Well, maybe if we request the foreign aid of a Karzakstan or Pashtun war lord and his tribal executives to enforce radical change, it might succeed. Mabe they could first rewrite the rules for the 700 bil too.

The retail price was not mentioned but look what's coming down the road from China. http://news.bbc.co.uk/2/hi/programmes/from_our_own_correspondent/7779261.stm

 

[James48843]

There is a good explanation of what really happened this week.

It's not about lowering costs of labor. Labor really only accounts for about $800 to $1,000 of the price of a new car, and cutting a few dollars off that is going to make the difference between success and failure of the car companies. It's a lot more than that. Republicans are the party intent on lowering the wages and benefits of the American worker, plain and simple; and most importantly, Republicans want to break American organized labor. They see organized labor as a roadblock to their power- and that is what republicans are all about- gaining and holding power.

This is simply all about breaking organized labor. This explains it:

​

 

[James48843]

Here is UAW's press conference from Friday:

Part 1

Part 2

Part 3

Part 4

Part 5

​

​

 

[McDuck]

Autoworker wage and benefit differences

By The Associated Press – 2 days ago

Hourly wages for United Auto Workers laborers at General Motors Corp. factories actually are almost equal to those paid by Toyota Motor Corp. at its older U.S. factories, according to the companies. GM says the average UAW laborer makes $29.78 per hour, while Toyota says it pays about $30 per hour.
The difference is in benefits, with the unionized factories having far higher costs.

GM says its total hourly labor costs are now $69 including wages, pensions and health care for active workers, plus the pension and health care costs of more than 432,000 retirees and spouses. Toyota says its total costs are around $48. The Japanese automaker has far fewer retirees and its pension and health care benefits are not as rich as those paid to UAW workers.

The UAW has not been able to organize workers at a Toyota plant in this country; it does represent workers at one joint GM-Toyota plant in Fremont, Calif.

 

[McDuck]

Autoworker wage and benefit differences

By The Associated Press – 2 days ago

Hourly wages for United Auto Workers laborers at General Motors Corp. factories actually are almost equal to those paid by Toyota Motor Corp. at its older U.S. factories, according to the companies. GM says the average UAW laborer makes $29.78 per hour, while Toyota says it pays about $30 per hour.
The difference is in benefits, with the unionized factories having far higher costs.

GM says its total hourly labor costs are now $69 including wages, pensions and health care for active workers, plus the pension and health care costs of more than 432,000 retirees and spouses. Toyota says its total costs are around $48. The Japanese automaker has far fewer retirees and its pension and health care benefits are not as rich as those paid to UAW workers.

The UAW has not been able to organize workers at a Toyota plant in this country; it does represent workers at one joint GM-Toyota plant in Fremont, Calif.

If Toyota pays their workers $30 and GM pays its union workers $29, why are the GM worker paying dues to the union-bosses? huh?

 

[James48843]

Congress (mostly Repubs) were right to grill the Big 3 about getting lean and mean. They need to quickly cut product lines, plants and even more salary and possibly retirement benefits.

They HAVE been getting lean and mean, cutting product lines, plants, and workers. Lots of workers have been cut over the last few years. This year, for example, GM employs 73,000 UAW workers. That's down from 102,000 in 2005, and 123,000 in 2000.

 

[McDuck]

What makes a car American?

By Ashley Fantz
CNN

(CNN) -- With the top U.S. automakers in economic survival mode, "Buy American" is a frequent cry among those trying to save jobs at home.
But buying a car to benefit the U.S. economy has become an ambiguous, complicated challenge.

"How you define an American car is one of the great conundrums of this world," said Dutch Mandel, the editor and associate publisher of AutoWeek.
Fewer than half of the parts on some Big Three vehicles are made in the U.S.

Looking at a Ford Fusion? It is assembled in Mexico. The Chrysler 300C is assembled in Canada, but its transmission is from Indiana; the brand's V-8 engine is made in Mexico. Engines in the Chevrolet Equinox sport utility vehicle are from China.

On the other hand, Toyota's Camry is comprised 80 percent of parts made in the United States, and 56 percent of Toyota's vehicles sold in the U.S. also are made here, according to Toyota spokeswoman Sona Iliffe-Moon. The Toyota Sienna and Tundra also have 80 percent of their parts manufactured in the U.S.

"When you have manufacturers from around the world building cars in the U.S. with 85 percent domestic content -- engine, transmission, assembly -- is that an American car?" Mandel asked. Or, he asks, is it considered foreign because the profits go back to a foreign country?

"It's truly a global industry," said Thomas Klier, a Chicago, Illinois, economist who co-authored "Who Really Made Your Car?" an encyclopedic analysis of the auto industry melting pot.

"When you think of buying American, you should focus on three points -- its engine, transmission and where it was assembled," Klier said.
To get that information, read a vehicle's window sticker. U.S. automakers are legally required to detail the origin of a car's parts and its final assembly point.

"Unfortunately, there are few people who know about the sticker or even bother to look at it," said Bernard Swiecki, a senior project manager at the nonprofit Center for Automotive Research in Michigan, which follows trends in the industry.

The sticker's details were news to Douglas Sullivan, 43, a truck driver from Snellville, Georgia. Though he prefers foreign brands, believing them to be of higher quality, he said he used to favor U.S. brands because he wanted to support American workers.

"I wanted to keep the jobs right here," Sullivan said.

Swiecki said many people think about image of a brand, rather than the way that brand has evolved over decades as the market has grown more diverse and competitive.

"They will think, 'I'm buying a GM, I'm getting an American car,' " Swiecki said.

Foreign car manufacturers generate billions of dollars in jobs and community infrastructure in the U.S., but there is a difference between Detroit's economic footprint and that of its foreign rivals.

The Center for Automotive Research says Detroit's Big Three employed almost 240,000 people in the U.S. at the end of 2007. Foreign makers had about 113,00 U.S. employees at the time.

The key difference in how the Big Three and foreign brands support jobs in the U.S. comes outside the factories, according to a 2006 study by the Level Field Institute, a group formed by Big Three retirees in Washington.

"What's driving the difference in jobs ... is investment in research, design, engineering and management," Level Field President Jim Doyle said in a statement on the 2006 study.

The Center for Automotive Research said the Big Three had 24,000 engineers on U.S. payrolls in 2007. The Japan Automobile Manufacturers Association said its member companies had 3,500 U.S. research and development employees in 2007.

Level Field found that every 1,000 vehicles sold by Detroit's Big Three in the U.S. support more than twice as many jobs as 1,000 vehicles sold by foreign nameplates.

Most Americans consumers understand that the industry is global, Swiecki said, and they are more savvy than ever in purchasing vehicles.

"For the most part, gone are the days of people going to a car lot and paying a buck to take a swing of a hammer at a foreign-made car," Swiecki said.

But there are exceptions.

A Savannah, Georgia, Ford dealer sold 15 cars last weekend after he ran a radio ad blaming Japan for Detroit's financial funk.

While 15 was substantially better than weekends before the ad, dealer O.C. Welch said, it was still about half of the business he did a year ago.

"All you people that buy all your Toyotas and send that money to Japan, you know, when you don't have a job to make your Toyota car payment, don't come crying to me," Welch says in the ad. "All those cars are rice ready. They're not road ready."

Sullivan, who was at an Atlanta, Georgia, dealership Thursday to pick up
his American brand minivan from the service department, said he has had a different experience.

He said the vehicle has given him trouble, and whenever he replaces it, he'll probably go with a foreign brand, regardless of whether any of the parts were made in the United States.

"What I look for is good gas mileage, and when I pay it off in four or five years, it's still running," said Sullivan, who has owned several American and foreign brands. "It seems I get better quality with a foreign car."


Find this article at:
http://www.cnn.com/2008/US/12/12/american.cars