GM to buy out US workforce to hire lower paid employees.

[alfredo]

http://money.cnn.com/2008/02/12/news/companies/gm/index.htm?cnn=yes

GM offers buyouts to 74,000
Auto giant aims to replace much of U.S. workforce with lower-paid new hires, dangling $140,000 buyouts to UAW members to stem North American losses.

By Chris Isidore, CNNMoney.com senior writer
February 12 2008: 12:44 PM EST

NEW YORK (CNNMoney.com) -- In an effort to shave ongoing losses, General Motors offered lucrative buyouts Tuesday to 74,000 employees - its entire U.S. hourly workforce.

The nation's largest automaker announced the latest round of buyouts as it reported another loss on its core auto operations in the fourth quarter, which combined with charges taken earlier in the year left GM (GM, Fortune 500) with a company-record $38.7 billion net loss for 2007.

To try to stem automotive losses that have dogged the company since 2005, the company is making a range of offers, up to cash payments of $140,000 to the remaining 74,000 GM workers represented by the United Auto Workers union.

The goal is not to reduce headcount but rather to bring in new workers at a lower cost.

[antigop]

1. Raise that h1-b visa limit -- claim there aren't any qualified American workers. n/t

[aquart]

2. Yeah, that's what's wrong with the company: paying a living wage.

[alfredo]

3. The workers are now having to pay for decades of bad management.

The packages they are giving would be good if the prospects of a new job outside of the auto industry were good.

[katty]

29. yes, they stated they could hire 16K workers back at

half the wage, with no union. the march of globalization...

[alfredo]

35. I thought that the union will still be there, just that they

got a smaller benefits package.

[michreject]

4. This was negotiated in the last contract

mutual agreement between the Co. and union.

[alfredo]

5. It would be in nobody's interest to let GM die.

[Hippo_Tron]

8. It would certainly be environmentally friendly to let American car companies die

[alfredo]

11. Yeah, but other countries would fill the gap. Chances are they won't

be union.

[Hippo_Tron]

15. They will fill the gap with more fuel efficient cars...

And if they are made in Europe there's a good chance they will be union.

[alfredo]

19. This is what happened to the US bicycle industry. Instead of learning

from the Europeans and Asians, US bike makers kept making water pipe frames and stamped soft metal components that didn't adhere to any standard of size or threading (even within their product line). They weighed ten to twenty pounds more, the finish was subpar, they didn't handle well, the brakes and derailleurs didn't work well, parts didn't fit, and if you tightened a axle nut too tight, the axle would strip, not the nut.

Luckily, the small independent companies like Cannondale and Trek went for quality and succeeded. Maybe that is the future of the US auto industry.

[Romulox]

28. Except that the modern mainstream bike market is dominated by cheap crap

I'm not sure how you've decided that the modern bike market is somehow superior to the old days, but the average bike sold today is a piece of crap!

Moreover, Schwinn bikes have been equipped with Suntour and Shimano derailleurs for as long as I can remember. Both companies are very much Japanese. Before that, they used French made derailleurs.

[alfredo]

32. I was in the business from 75 to 88. That was the time when

the Japanese took over our market. Schwinn bikes were the exception in many regards, though they hung on to the heavy bikes like the Varsity much too long. The Paramont was a fine piece of equipment. I was dissing the department store bikes like Huffy, Colombia and the Wald parts they used.

[Initech]

6. And why hasn't there been a revolution yet?

Someone needs to hang these motherfuckers out to dry.

[kath]

7. hmm - here they can't even give that bullshit "work that Americans won't do" argument.

fuckers.

[Hippo_Tron]

9. Frankly I think we should stop protecting the US auto industry, but I know I'll be in the minority

If it were up to me I'd give every auto industry worker enough money to be financially secure for the rest of their lives and to send their kids to college and then remove all of the quotas and tariffs on imported cars.

Japanese cars aren't made in sweatshops by people making 2 cents an hour. This is an instance where foreign competitors genuinely make better products than we do and we're protecting inefficiency.

[alfredo]

13. We make Toyotas near here. They aren't union, and the turnover due

to stress injuries is fairly high. The pay is OK.

[amandabeech]

21. You don't know where all those Toyota parts come from.

Some come from low-wage countries with poor worker protections.

The Japanese generally outsource much to China, for example.

The dollar is down, and cars made in Europe are increasingly expensive here. Also, the Europeans must make slightly different cars for export here because safe and emissions standards are not the same in the EU as they are here, and that pushes up the cost. I'm not saying better or worse, just somewhat different.

As a result I don't think that you will see a huge resurgence in imports from Europe no matter what happens.

[Hippo_Tron]

25. So are the parts that we use to make US cars made in the USA?

Or do we outsource part of that just like Japan does?

[amandabeech]

27. We outsource quite a bit of it, unfortunately.

A lot of stuff comes from Canada, Mexico, Japan and China. At one time, the Japanese brought their suppliers with them, who then set up shop here, and wouldn't buy from U.S. suppliers. I don't know if that has changed.

What is obvious to the consumer is where the final assembly took place, usually the U.S., Canada or Mexico, not where the parts came from.

There is some question on how the feds count the manufacturing value of the car for U.S. statistics. I have read that the feds count the retail value of the total car, not the value of U.S. parts or final assembly in statistics on the dollar value of total manufacturing here. I don't know if that is true or not.

[mnhtnbb]

10. Software company my son worked for laid off 75% of tech support department

then hired contract workers to replace them.

They announced late last summer they would be outsourcing tech support to India in 1 to 2 years.
In Nov the CEO and CFO were fired; everyone was assured there would be no layoffs. Less than one month after my son got a 5% merit raise in December he was laid off in early January.

[alfredo]

12. The company is out from under having to pay for benefits when they

contracts out the work. It simplifies the taxes too. It also sucks.

[earth mom]

14. Say Goodbye to the middle class.

:(

[Triana]

16. Scumbag bastards...THIS is a practice that ought to be made

ILLEGAL and the companies FINED 3x the amount of money they endeavor to save by firing union/American workers and getting cheaper ones. If it puts their asses under - TOO BAD. That'd never happen anyway if such a Federal Law was in place.

The money can go to retraining programs for displaced workers affected by this type of bullshit and other corprat bullshit - and for additional enforcement programs to enforce the new law.

WHY do we allow corprats to DO this to our workers and WHEN are going to put a stop to it?

[joeglow3]

17. I hope you own GM cars

I do. But it pisses me off when I see people say this, but then run out to buy foreign made cars.

[Triana]

22. My whole family does...

...and I STILL think there ought to be a FEDERAL LAW against ousting union/American workers to hire cheaper ones.

If the CxOs at GM screwed up - then get rid of THEM. FORCE THEM to DEAL with their mismanagement of the company.

IF they go under paying fines for their idiocy then they do - Americans will lose their jobs - but guess WHAT - they're LOSING THEM ANYWAY - have you noticed?!

HAVE YOU NOTICED?

MAKING THESE SCUM ACCOUNTABLE for their mismanagement of these corporations - putting the bandaid where the bleeding is, is the ONLY thing that will put a stop to this.

Some of them will go under - but those American jobs are GONE anyway. HAVE YOU NOTICED?

EVENTUALLY, the corprat scum will wise up to the FACT that they can no longer mismanage a corporation to the disadvantage of the workers and SURVIVE and they'll change their freakin ways.

HIT THE PROBLEM where it is. It will be NO MORE painful and eventually much LESS painful than allowing the corprats to just mismanage these corporations into the dirt and making UNION WORKERS and American workers pay the price.

When it hurts THEM (the CxOs who run these corporations into the ground), PERSONALLY - they'll stop. And ONLY then, will they stop and THINK about how they do their jobs. The PSYCHOPATHS that largely run corporations today will be out of work and will have to be replaced with human beings with a CONSCIENCE instead.

That can only be a good thing.

[Greyhound]

36. Over 30 years and counting. n/t

[screembloodymurder]

18. CNBC says it's a good deal for GM and their former employees,

but is it a good deal for the US? Is it a good deal for our children and grandchildren?
Is it a good deal for democracy?

[Triana]

23. What corporation owns CNBC? (n/t)

[juajen]

34. Wouldn't that be GE? I believe they own NBC, MSNBC, so I assume all

those little NBC babies are theirs?

[dysfunctional press]

20. they'd be smart to take the money and run.

because things are only going to get worse if they stay.

[alfredo]

24. find a cheap town, move there, cut back, live simple, do what you can to

survive.

[aint_no_life_nowhere]

26. What happens if the new, lower-paid employees can't afford a GM car?

Or is GM going to pleasantly surprise me by designing new, tiny gas efficient cars that everyone can afford, even though the profit margin on them might be smaller?

[Swamp Rat]

30. C'mon take the money and run!.... hoo hoo hooo!

One could buy a house, a car, and start a business in a Latin American country with that kind of cash.

[SoCalDem]

31. They are spending billions on new facilities...

in INDIA..:grr:

[The Gunslinger]

33. Why is the economy going down the drain??

Hmm.......higher prices , lower wages. Yep that'll do it. And it will go downhill until government helps to control it. Thats why I wanted Edwards.