Will GM or Chrysler going under affect you?

[Colleen27]

Yes and no. Neither I nor my husband work in the car industry and the only person in our family who does (my dad) is retiring this summer. That being said, we all live in SE Michigan, and its impossible not to be affected.

As for the whole "Buy American!" thing, there's a bumper sticker that's pretty popular around here: Out of a Job Yet? Keep Buying Foreign. Okay, I get that, but when you see it on cars with Ontario plates it tends to lose effect.

With as much as the Big 3 operate in Canada and as tied to the economic tides of Michigan as the Windsor/Sarnia part of Ontario is, I don't think it loses anything at all. The border just doesn't have that much meaning here.

 

[Momto3Girls&Max]

I think that there is a point where people sort of take the US automaker woes a bit too far. I know it's an emotional thing for a lot of folks, especially those directly affected.

I think that the reality of the auto woes is that we never should have been making 17 million cars a year. We didn't need that many, and the only way we got there was due to the "easy credit for all" days we just lived through. Now we're producing 9 million a year (based on monthly data), but that's probably not enough.

Still the auto industry is in the process of shrinking in a big way. The weak will lose market share and those well positioned will gain market share. Capitalism at work.

A similar event took place in the early 2000s when the Tech Bubble burst. We had far too many IT companies that were not profitable and many of them went away. Think of all the dot-coms that no longer exist. All of those people were laid off as well. There was no government bail-out for those workers. I should know as my DH was one of them. He was lucky in that he found a job with a few weeks. Some of his friends went months and months without a job. Some had to learn new skills and retool themselves for a new difficult IT job market. But life went on.

And so I just don't buy this idea that the world will stop spinning if we lose one of the Big Three. I think we lose Chrysler ultimately, but that GM and Ford survive, albeit as smaller entities. GM will probably end up going BK and emerging down the road with a new leaner company that is better positioned to compete in the global market. Some suppliers go under, but many will make it by selling parts to automakers who picked up US market share....mainly the Asian producers.

Very well said. (The bolding is mine.)

We need to let the capitalist market work without government intervention. Intervention only provides a temporary fix but the house of cards inevitably comes tumbling down sooner or later.

 

[daughtersrus]

My DH is an auto tech at a Lincoln/Mercury dealer. Their contract is up in Aug and since there are many GM dealers in the associations, I'm sure that it will affect us.

PS ignore the title of my post. I thought that I had started a new thread. Sorry!

 

[natenapril]

My DH is an auto tech at a Lincoln/Mercury dealer. Their contract is up in Aug and since there are many GM dealers in the associations, I'm sure that it will affect us.

PS ignore the title of my post. I thought that I had started a new thread. Sorry!

Think you might be on the wrong thread

 

[peyjax]

There is so much misinformation in the media right now. Anyone who thinks that GM quality lags behind the foriegns needs to read JD Power and other reliability surveys. GM is a leader in quality. GM products are also some of the most cutting edge styles around. Anyone one see the new Camaro? Check it out. Read the reviews from Motor Trend and Car and Driver.


Joybeth[/QUOTE

]

I personally do not care what JD Power or the media says. I listen to my neighbors, friends, and family. The word is still out that GM, Chrysler and Ford do not match on quality of a Honda, Toyota, etc. Sorry if you don't like it, but I am not alone in my thinking. The big 3 should have thought of that a long time ago. In this area you do not see many old nor new Camaros around. Why try to reinvent a car people that was so cool in 1985?? Hello it is 2009!

I just do not feel guilty buying a Honda that was made in OHIO or a Toyota that was made in KY.

Please do not get me wrong I do feel bad for those losing thier jobs. It stinks and I am sure it will affect us somehow, just like all the banks going under affected us.

 

[katiedid36]

I am another Diser living in SE Michigan. Both DH & myself work for automotive suppliers. When I started working here 7 years ago we had 2500 people. With the latest layoffs this month we are down to 900 people. I haven't had a raise in 4 years but I am lucky to have a job. Everyday my DH goes into work he is waiting for the shoe to drop. My Dad works for Ford. He works in HR & everytime he stops by someone's desk they look at him with panic. They too are just waiting for the ax to fall. It is no fun to live this way. My house it worth thousands less than it was 4 years ago. The house next door to me is sitting empty & just about every street in my subdivision has at least 2 houses for sale (most of them are empty). In my area grocery stores have closed, the malls are empty, buildings & houses sit vacant. It truly is a sad state of affairs.

 

[luvmy3]

I am another Diser living in SE Michigan. Both DH & myself work for automotive suppliers. When I started working here 7 years ago we had 2500 people. With the latest layoffs this month we are down to 900 people. I haven't had a raise in 4 years but I am lucky to have a job. Everyday my DH goes into work he is waiting for the shoe to drop. My Dad works for Ford. He works in HR & everytime he stops by someone's desk they look at him with panic. They too are just waiting for the ax to fall. It is no fun to live this way. My house it worth thousands less than it was 4 years ago. The house next door to me is sitting empty & just about every street in my subdivision has at least 2 houses for sale (most of them are empty). In my area grocery stores have closed, the malls are empty, buildings & houses sit vacant. It truly is a sad state of affairs.

Unfortunately this isn't an auto industry only reality.

 

[budbeerlady]

We live in SE Michigan. We've already lost $100,000.00 on our house. Trying to sell right now is really bad. If GM or Chrysler go under, NO ONE will be moving to this area, or buying any of the houses for sale around here.

There's a city called Flint north of here. The auto industry left there many years ago. Now there are no jobs, and it's a very depressed area. I fear that what happened in Flint is heading to the suburbs of Detroit soon.

We are on the West side, Dh lost his electrical job November of 2007. The building just stopped, it was scary how quickly it all ended. If the automakers can keep going under some form of bankruptcy protection we might be able to keep a couple of small suppliers on this side. It seems everyone who could left almost 2 years ago.

" However, the Ottawa County portion has a 16.6 percent unemployment rate" was in the local paper March 21, 2009. Unemployment rates in other Michigan cities

• Flint: 24 percent
• Detroit: 22.2 percent
• Saginaw: 20.7 percent
• Muskegon: 17.4 percent
• Lansing: 15 percent
• Grand Rapids: 13.5 percent
• Kalamazoo: 11.6 percent
• Ann Arbor: 7.8 percent

http://www.hollandsentinel.com/archive/x1465807222/Holland-city-unemployment-varies-by-county

 

[gr8tdame]

Even though I have Ford stock I do not want Chrysler to go under.
We always buy american made, american designed vehicles. My dh drives a Ford F-150 and I have a chrysler Town and Country that replaced my previous 10 yr old Dodge Grand Caravan. Most of my friends have purchased Honda ,
Toyota and Volvo vehicles and some are not all that happy.
I have always had American vehicles except for one. (expensive sporty german import that cost a fortune to service During they YUPPY DINK Live aand learn.
Chrysler especially has had innovative designs in their vehicles that have kept GM and Ford on their toes and inspired other auto makers.
I feel if the big american auto makers go under we will soon be driving all the same colored boxes and become even more dependent on foreign industries.
Let's hope we can keep the jobs in the USA.

 

[NMW]

I feel very sorry for the auto workers and the people in MI.

As for GM, I think going bankrupt may be the only way to survive. The bondholders and union will have to agree to less. Which I don't exactly understand. Maybe some GM people can tell me why the UAW refused to make the concessions the company needed to stay viable? I am not in a union and really don't understand how that works, but why would they not give up things to keep the company strong and making money? I mean surely making concessions has to be preferable to closing plants and laying off workers, right? Do you think if the UAW had made these concessions the Gov. wants a couple years ago it would have made a difference for GM? I'm really just curious for an insiders opinion on it.

Hopefully things will turn around in MI soon. I don't think the all of America think's that it's only "Detroit's problem." Many Americans care about what happens to the auto workers.

 

[mamalle]

I wouldnt put down GM at all. dh has always owned GM products and would love to have the new camaro to add to his 67... BUT with our experience with Chrysler.. well that is a totally different story.. Their quality and service is lacking at best.. It was a real disappoint after I spent $36,000 on a brand new minivan to have it in the shop a few times a year- every year since we bought it in 2004. They lost my business even if they do recover from this in the future.. GM- well that is America like apple pie and it will be a sad day if they do go under... It will trickle down like everything else and affect all of us AMERICANS..

 

[wall*e2008]

This if from 2005 and they were still losing money. Sorry the format is bad. See is at http://www.npr.org/news/specials/gmvstoyota/ for better formating.


GM vs. Toyota: By the Numbers
by Diane Geng
Dec. 19, 2005 -- General Motors has been the world's No. 1 automaker since 1931. But GM's dominant position is eroding rapidly. Last year, Toyota surpassed Ford Motor Co. to become No. 2 in the global vehicle market. Some analysts predict Toyota will catch up to GM in two to three years. In November 2005, GM announced that over the next three years it plans to cut 30,000 jobs and reduce capacity by 30 percent from 2002 levels. We compare the global auto industry's two titans, with an emphasis on the U.S. and North American markets.


Vehicle Production Started in U.S.
Source: GM & Toyota
GM:
1908
Toyota:
1986

Brands Sold in North America
Source: GM & Toyota
GM:
Buick, Cadillac, Chevrolet, GMC, HUMMER, Pontiac, Saab, Saturn
Toyota:
Toyota, Lexus, Scion, Hino
Best-Selling Vehicle in U.S.
Source: GM & Toyota
GM:
Chevrolet Silverado

680,768 sold in 2004
Toyota:
Toyota Camry

426,990 sold in 2004
U.S. Sales in 2005
Source: Autodata
GM:
4,454,386, down 4.3% from 2004
Toyota:
2,260,296, up 10.1% from 2004
U.S. Market Share
Source: First nine months of 2005, Harbour Consulting
GM:
26.8%
Toyota:
13%
Vehicle Production in North America 2005
Source: GM & Toyota
GM:
4,856,000
Toyota:
1,558,828
Profitability per Vehicle
Source: 2005 Harbour Report
GM:
Loses $2,331 per vehicle
Toyota:
Makes $1,488 per vehicle
Net Income in the First 9 Months of 2005
Source: Harbour Consulting
GM:
$4.15 billion loss from North America operations off-set by profits in Europe and Asia for an overall loss of $3.8 billion
Toyota:
$7.89 billion (¥921.7 billion, converted at 116.81 yen to $1)
Number of Plants in North America
Source: GM & Toyota
GM:
77, all unionized. Plans to close 12 facilities by 2008 (see press release).
Toyota:
12, three unionized in Long Beach, Calif., Fremont, Calif., and Tijuana, Mexico.
Average Plant Capacity Utilization
Source: Harbour Report 2005
GM:
85%
Toyota:
107% using overtime workers
Production Time per Vehicle
Source: 2005 Harbour Report
GM:
34.3 hours, 2.5% improvement since 2003
Toyota:
27.9 hours, 5.5% improvement since 2003
North American Workforce
Source: GM & Toyota, Dec. 2005
GM:
White collar: 36,000

Production: 106,000.

Retirees: 460,000
Toyota:
White collar: 17,000 Production: 21,000 Retirees: 1,600
Average Hourly Salary for Non-Skilled, Assembly Line Worker
Source: Center for Automotive Research
GM:
$31.35/hour
NOTE: Includes idle workers still on payroll and those on protected status.
Toyota:
$27/hour
NOTE: Includes year-end bonus.
Health Care Costs per Vehicle in 2004
Source: 2005 Harbour Report & A.T. Kearny Inc.
GM:
$1,525
Toyota:
$201
Average Labor Cost per U.S. Hourly Worker
Source: GM & Toyota
GM:
$73.73
Toyota:
$48 Worldwide Sales in 2005
Source: GM & Toyota
GM:
9.2 million
Toyota:
8.2 million
Global Market Share in 2005
Source: Automotive News, GM & Toyota
GM:
14.2%, down from 14.6% in 2002
Toyota:
12% up from 10.6% in 2002
Worldwide Vehicle Production Projected for 2005
Source: 2005 Harbour Report
GM:
9 million

Manufacturing operations in 32 countries, vehicles sold in 200 countries

Toyota:
8.4 million

Manufacturing operations in 26 countries and regions, vehicles sold in over 170 countries

 

[Colleen27]

GM vs. Toyota: By the Numbers

There are many very good reasons for those numbers, though... Toyota hasn't been operating in the US long enough to have retiree obligations, and operates on a model that provides much less to employees in retirement (401k instead of pension). The Big 3 have moved to the same model for new hires, but have many decades of retirees that they have obligations to. And Toyota only has a very small fraction of their operations in the US; the company as a whole has much lower costs for employee benefits because the bulk of their operations are located in countries with national health care. Comparing a snapshot of Toyota vs GM is truly apples to oranges.

 

[joybeth]

There are many very good reasons for those numbers, though... Toyota hasn't been operating in the US long enough to have retiree obligations, and operates on a model that provides much less to employees in retirement (401k instead of pension). The Big 3 have moved to the same model for new hires, but have many decades of retirees that they have obligations to. And Toyota only has a very small fraction of their operations in the US; the company as a whole has much lower costs for employee benefits because the bulk of their operations are located in countries with national health care. Comparing a snapshot of Toyota vs GM is truly apples to oranges.

Exactly, Colleen,

I someone wants to really make a comparison I would suggest find an article a little more current than 2005. For example: an author that is getting press everywhere is William Holstein, and he writes:

"It might not seem like the time to contemplate GM’s gains against Toyota, after all GM is receiving loans from the federal government just to survive the U.S. financial meltdown, and the incoming Obama administration will have to consider what it should do to keep GM alive. But a new book entitled Why GM Matters: Inside the Race to Transform an American Icon, argues that GM has made surprising progress in ways that have largely escaped the daily headlines. Author William J. Holstein, former president of the OPC and current president of the OPC Foundation, has covered the battle between GM and Toyota for more than two decades and will speak on the global competition between the two rivals.

“Not many people understand that GM has literally gone to school on Toyota to learn the lean manufacturing technique and it has succeeded in adapting it and improving on it in some cases,” says Holstein, who edited BusinessWeek’s first cover story on Toyota in 1985. “As a result, GM has nearly eliminated the quality and productivity gaps it has long suffered.”

If GM can survive 2009, its cost structure per vehicle will approach that of Toyota’s first plant in Georgetown, Kentucky. Even before GM and Chrysler agreed to undertake a new round of restructuring to qualify for continued federal assistance, GM Chief Executive Officer Rick Wagoner had reached agreements with the United Auto Workers that will strip $5,000 of the cost of each GM vehicle by 2010.

On other fronts, GM is battling neck and neck with Toyota to introduce the first electric vehicles powered by lithium ion batteries. GM is scheduled to launch its Chevrolet Volt in late 2010; Toyota has just announced that it will rush its own lithium ion battery car to market before then. But in sharp contrast with the nickel metal hybrid-powered Prius, GM will at least be competing on the same field of battle, Holstein argues, rather than completely abdicating.

Toyota itself is suffering its first loss in decades and has signaled that it has excess capacity in the United States. Its quality has suffered and it has just shaken up his executive suites by moving a member of the Toyoda family into the job of president.

“Until very recently, most people assumed that Toyota would simply blow GM out of the water,” says Holstein. “But GM is fighting back against big odds. I think it’s going to surprise some of its many critics.”

There is a lot of up to date information out there if anyone is truley interested in reading. Unfortunatly, most people would like to rely on outdated information and old sterotypes rather than seek out what is really going on.

Sad, I think...joybeth

 

[dfchelbay]

This entire subject if freaking me out. We don't work for or in the auto industry, but if they go under...we'll never escape this house. I feel like I have to hurry and pack up everything, get the house sold and get out of here before the entire state goes under.

 

[wall*e2008]

There are many very good reasons for those numbers, though... Toyota hasn't been operating in the US long enough to have retiree obligations, and operates on a model that provides much less to employees in retirement (401k instead of pension). The Big 3 have moved to the same model for new hires, but have many decades of retirees that they have obligations to. And Toyota only has a very small fraction of their operations in the US; the company as a whole has much lower costs for employee benefits because the bulk of their operations are located in countries with national health care. Comparing a snapshot of Toyota vs GM is truly apples to oranges.

Having to support 3 retirees for every employee (based on 2005 numbers) IS a huge part of the problem that GM has. The cost of retirees has to be handled for GM to survive.

 

[Sweety_tweety]

Our whole family has bought Chrysler products for years. I can honestly say we are very happy with our purchases over the years. Every company has it's lemons--it does leave a bad taste in your mouth if you happen to get one. I have heard people getting a lemon with Toyota and Honda as with the Big 3.

I also believe if the big three go under it will have a trickle down effect on the local economy. The little sub shops and little mom and pop stores near the plants won't survive.

I think we need to bring manufacturing back to the US so we don't need to worry about lead being infused into products we buy.

There are many stores closing all over our area--anything from Walgreens to Value City to TruValue.

 

[dvcgirl]

Our whole family has bought Chrysler products for years. I can honestly say we are very happy with our purchases over the years. Every company has it's lemons--it does leave a bad taste in your mouth if you happen to get one. I have heard people getting a lemon with Toyota and Honda as with the Big 3.

I also believe if the big three go under it will have a trickle down effect on the local economy. The little sub shops and little mom and pop stores near the plants won't survive.

I think we need to bring manufacturing back to the US so we don't need to worry about lead being infused into products we buy.

There are many stores closing all over our area--anything from Walgreens to Value City to TruValue.

Well, I can honestly say that I've never in my whole life met anyone who owned a Toyota or a Honda that didn't like it or ever thought of it as a "lemon". I also know a lot of people who owned American made cars and while many of them loved their autos, some were indeed lemons.

We just took a trip from NJ to NC a couple of weeks ago. Our flight back was cancelled and we needed to get home so we had to rent a car. We ended up with a Dodge Nitro (SUV). It certainly wasn't an bad ride, but it wasn't as comfortable as our Highlander and it felt "cheap" inside. That's the only way I can describe it.

I don't know, for me, well, I'm not willing to make a 20-30K purchase on an American made car and hope that I'll get 200K miles out of it when I *know* that if I purchase the Toyota that I will get that 200K. And as we've said on many threads on these boards, many of those Hondas and Toyotas are made right here in the states. And the parts are made here as well.

If Apple was a Japanese company, I'd still be typing this on my Mac and be talking on my iPhone today. It's a quality issue.

 

[lastminutemom]

Well, I can honestly say that I've never in my whole life met anyone who owned a Toyota or a Honda that didn't like it or ever thought of it as a "lemon". I also know a lot of people who owned American made cars and while many of them loved their autos, some were indeed lemons.

We just took a trip from NJ to NC a couple of weeks ago. Our flight back was cancelled and we needed to get home so we had to rent a car. We ended up with a Dodge Nitro (SUV). It certainly wasn't an bad ride, but it wasn't as comfortable as our Highlander and it felt "cheap" inside. That's the only way I can describe it.

I don't know, for me, well, I'm not willing to make a 20-30K purchase on an American made car and hope that I'll get 200K miles out of it when I *know* that if I purchase the Toyota that I will get that 200K. And as we've said on many threads on these boards, many of those Hondas and Toyotas are made right here in the states. And the parts are made here as well.

If Apple was a Japanese company, I'd still be typing this on my Mac and be talking on my iPhone today. It's a quality issue.

Raising my hand here-- First, we had a Chrysler mini van that was a piece of junk. Literally, we donated it to charity because it had no trade in value (and it was under 7 years old)

However, DVC Girl, I guess you haven't met any of the 1000s of Honda Odyssey owners who have had transmissions problems. There was a big lawsuit that Honday settled and another one is getting ready to be filed.

Perception is reality especially when it comes to car quality issues. Imagine our surprise when we started having transmission problems and found tons of information about how common this was.

 

[dvcgirl]

Raising my hand here-- First, we had a Chrysler mini van that was a piece of junk. Literally, we donated it to charity because it had no trade in value (and it was under 7 years old)

However, DVC Girl, I guess you haven't met any of the 1000s of Honda Odyssey owners who have had transmissions problems. There was a big lawsuit that Honday settled and another one is getting ready to be filed.

Perception is reality especially when it comes to car quality issues. Imagine our surprise when we started having transmission problems and found tons of information about how common this was.

No, I don't know any odyssey owners, but I had heard of that problem. And while my 97 4-Runner is still kicking butt, I know that the 95 version had a lot of issues. I'm talking about "in general".....the quality of Toyota and Honda has surpassed that of American made cars.

I can only speak for myself, but I will remain a loyal Toyota customer unless they give me reason to rethink that. I don't link my own personal patriotism to "driving or buying" American.