UAW Killed GM & Ford. Now They’re Going To Kill You.

The members of the UAW may finally realize that Unions don’t work.  It’s common knowledge these days that the UAW was the driving force in GM’s stellar $10.6B loss in 2005, $2B loss in 2006.  Or Ford’s $6B loss in 2006.  The UAW drove wages to $75/hr (base + benefits) for unskilled labor.  Of course, the management accepted it, so management is to blame too.

Now that Ford and GM have no money left, the UAW really can’t screw them anymore.  With $12B in losses, the management at GM has pretty decent footing when it says, “sorry, can’t give you more”.  It’s not the same as the concessions they gave during the auto boom. 

Who’s going to get screwed now?  Well, you are, of course!

First, the auto workers will get screwed.  Too bad they don’t read this blog!  The latest contract GM struck last week makes this obvious.  The workers will get no pay raises for 4 years, in exchange for some mild promises about not getting laid off.  Of course, they are so overpaid now, this isn’t a huge deal, but in 3 years, they’ll feel screwed anyway.  But here is the kicker – as part of this deal, a union-run trust fund is now responsible for a huge chunk of retiree health benefits.  A $51B liability.  Hmmm..  I’ve been unable to find crisp details about how this is funded and how its going to work, but it sounds like the UAW is going to get about $35B from GM to fund a $51B liability.  Wall Street is hailing this, of course, because GM just wrote off ~$16B in debt.  That’s pretty sweet.

So, last time I checked, the UAW wasn’t exactly the best with managing money.  With $35B in their pocket, do you think the Union Leaders aren’t going to be banking several 10’s of millions for themselves?  They will.  Who will they hire to manage this money?  Their friends?  For a small fee?  Yes.  A big fee?  Yes. 

When the smoke clears, the UAW will have shrunk the $35B to $30B through mismanagement of funds when they should have grown it to over $50B.  As a result, auto workers will get pennies-on-the-dollar in retirement/health benefits and start screaming.  GM and Ford will be bankrupt, so they won’t be able to help.  Aha – this is the part where YOU get screwed.  Uncle Sam will come in and save the day with their pension and healthcare bailout for auto workers at the taxpayers expense.

The UAW sucks.  Is it clear yet that the UAW has nothing to do with the workers and everything to do with Union Leadership getting rich? 

UAW sucked the life-blood out of GM & Ford.  Now their sucking the life-blood out of their own members (no pay raises/fewer benefits).  And in a few years they’ll suck the life-blood out of you.

20 Responses to “UAW Killed GM & Ford. Now They’re Going To Kill You.”

  1. Adrian says:

    Yeah, it could be that UAW workers are too expensive, or it could be that Ford can’t produce and market vehicles that people want. Their US market share has slipped from over 25% to barely 20% in 8 years, despite the face that their models are generally lower priced than the direct competitors.

  2. mike says:

    It’s a bit like saying, “I know he’s got cancer, Doc, but maybe the reason he’s dying is because you aren’t giving him the right medicine.”

    Ford is having trouble because its reputation and ability to build cars is permanently scarred thanks to UAW. Labor costs for Ford and GM in the 80’s forced these companies to skimp on quality and engineering while their Japanese counterparts invested in technology, processes, and facilities which continue to payoff today.

    What happened was the UAW forced labor rates to be artificially inflated. When American cars were the only ones being made, this was not a problem. But management didn’t recognize that prices would drop due to severe international competition. When prices dropped, the American companies couldn’t cut their labor costs due to UAW. In a competitive market, what happens? Quality and technology were compromised. Do that for 20 years and your company can lose $10B in a single year. UAW killed GM and Ford.

    Anyway, I think you are observing symptoms of the cancer, not the cause of the cancer.

  3. bb says:

    It’s very clear that the UAW is only looking out for what they can get into their own pocket. Taking care of your own is not a bad thing but for long term success in a competitive world workers need to help make their employers a profit. I’m not talking about making the UAW a profit either. Should employees be enabled to make an honest and respectable living? Of course. But with the quality of the parts and vehicles the UAW produces I would not call that a respectable living. Do I put the entire blame of quality on the UAW? Well, Yes. When was the last time the UAW called a strike because of poor quality parts and vehicles?

    To live the american dream we ALL have to produce high quality products, produce value, and make our employers a profit. The other option is to start and run your own business.

  4. julie says:

    i have photographed in many uaw plants…from what i have seen, uaw should stand for u aint work’n…they sleep on the job and pitch child like fits when overtime is not given…damn them all.

  5. kelvin says:

    UAW has crippled America. They should be ashamed!!!

  6. Don says:

    Even the Navajos new enough about economics to leave the Spanish settlers and neighboring Indian Tribes that they preyed on with enough horses, cows, sheep and daughters to continue producing, so they could raid them again in a couple of years. The UAW has raided the US car industry to the point where it can no longer survive.

  7. Jim McNamara says:

    I worked in A Dana plant for 32 years and it was also UAW. The Big Three UAW is the reason all the IPS plants have closed and went overseas. They put so much pressure on the Ips companies to lower their prices that they could no longer produce in the USA. Every time the big three got a new contract we had to make concessions to they could get their freebees.. When it came down to the point we could give no more , our companies had no choice but to close down and move if they wanted to remain in business. This all goes back to the contract language years ago that stated the Big Three could only outsource to other Union plants. This today is the end results. The UAW is a big three union always has been, now I hope they go away just like our jobs and benefits did

  8. Darren says:

    The poster is 100% right on. The UAW has done nothing good for their companies and simply created the laziest workers in the world. This extremely outdated concept is killing our image worldwide and creating frustration here at home. I HATE hate the UAW, may it die painfully.

  9. William says:

    I was in the UAW obligated with my employment and not chosen. After being in the Army 3 years for the college fund and graduating from a top art college, i found work as a sculptor in one of the big three. i started working with the work ethic instilled into me by the Army and one of the most respected art colleges, Art Center. This quality based, fast paced work ethic is despised by the UAW drunks and couch potatoes. They frequently came over to me saying things like “hey tone it down a bit, if you give them this effort they will expect it every time from you and the rest of us…BACK OFF THE EFFORT!” “Don’t kill yourself on that job, you have 30 years to go! Take it at a nice pace.” “Why do you want to work that hard and make him look bad, he’s been here 40 years and doesn’t appreciate it.” Then i was seen by management for doing a good job and photographed on the job for the hallway exibit, Auto show exhibit, design institute web site, and skilled trades magazine. As a result I was selected for interesting jobs involving overtime. This extra pay and variety of work created envy. The next thing i knew i was the focus of viscious accusatons, lies and a bullying campaign which resulted in investigations and my wrongful termination. My supervisor was nothing short of a modern day Nazi and got away with everything because he was ex-UAW and they covered his ass. That experience cost me everything as a process known as “gangstalking” ensued to get even with me for stealing some insecure a-holes thunder with a huge ego. I love to build things but i do not need to be represented by those who stifle me and hold me down and expect me to picket to support them when on strike. How can you demand so much when enforcing a work environment of half-ass effort? They suck, dissolve these parasites. All they did all day is talk about their houses and state “geet-er-dun.” Like the uneducated hillbillys they are. Let them recieve uneducated lazy hillbilly wages!

  10. Joel says:

    Every bad situation provides opportunity. In the case of the struggeling US based automakers an opportunity exists to uncover the real burden of operating a public business with union labor. While many business function quite well with a union present, it’s all too evident the majority are severly hindered. Take it a step further and maybe even look to understand the real burden of the teachers unions to the tax payer and the children the teach.
    The opportunity i’m speaking of is for the general public to rechognize and understand unions as a whole are a thing of the past. They had a time and place and early on provided a number of positives we all can be thankful for.

  11. joe smith says:

    The UAW must be broken and GM must go bankrupt.

  12. [...] You know what caused this crisis?   Here’s a good explaination. [...]

  13. [...] a year ago, I wrote a blog post about how the UAW was killing Detroit and how the government would ultimately bail them out.  The topic I addressed was UAW [...]

  14. Jim says:

    The bottom line, unions suck! Market forces should dictate what a fair wage is! Not some thug founded union that produce lazy and unproductive work forces. Unions suck!!!!!

  15. carrie says:

    My husband was a UAW worker for 22 years- 10 with a steel tube company and 11 with Chrysler. The UAW has made our live a living hell. He paid 52.00 a month for dues. When he had surgery the UAW Local and International did not do anything for us. We had to call around for his sick pay. No checks for 3 weeks. UAW response: We will get back with you. When my husband was at work he needed a Union rep for a saftey issue No one was found??? UAW means nothing to us anymore. I agree with all your comments above. I am sad for this when my grandfather was a Teamsters when I was a kid I remeber the walkouts and the Union standing up for what they believe in. If they said “No foreign truck,car or Company cross into the plant well by gees no one got thru”. Also when this last National contract was passed you local contract is supposed to follow NO WAY my husband with other workers has no local contract it is almost a uyear later. Here is the kicker the National contract that passed all UAW members get copies of this No copies’ When these workers approched there UAW leaders the response was ” There were somethings missprinted and the had to be reprinted” HA HA still no copies a year later. If this took place back then the workers would have walked out and striked. But NO the UAW lost there back bone along time ago. We were just giving them 52.00 amonth to play on.

  16. Sting says:

    I recently got into a hefty debate with US Senator Sherrod Brown. This idiot whole unfortunately represents my state (ohio) told me that 83% of workers, according to a survey, wants to be unionized, but can’t because of corporate owners tactics and intimidation workers representation is down! No, it’s down because workers have no need for money hungry unions. Their purpose is no longer necessary due to the tight labor laws and even the threat of unionization.
    I am a proud Republican. I have bought vehicles from all of the Big Three. So, when I saw last week that the UAW donated 99% of it’s political contributions to the Demoratic party, and only a mere 1% to the GOP, well guess what? I decided that if they won’t support me, then I won’t support them. My Dodge truck WILL be my last UAW made vehicle. Hell, even 10% would be acceptable. But an insulting 1%…screw them!! I just got a Volvo Cross Country and it blows away anything I have ever owned from the Big Three. Now I see why some people won’t buy American. It makes me sick. Unions are for losers who whine and carry on if they don’t get their way. And the Big Three just gave it to them. Idiots.
    Away with the UAW and then people like me will buy their cars.

  17. Dave says:

    I have never worked in a union factory but I have dealt with the UAW taking money out of my pocket at heavy truck dealer when they pushed to get higher wages for the mechanics when the money wasn’t even there. I was 60+ hours a week and not getting over time only commission selling and delivery of these heavy truck parts .Breaking my back and then finding out I had to take a 50% pay cut on my commissions because the money they asked for wasn’t there. The UAW is a disguised communist party. That’s why the UAW doesn’t work for these companies it just destroys them.

  18. Buying Imports says:

    I love what is going to happen to UAW. Now that GM is filing for chapter 11. The next thing to fall off the map are all those worthless workers. The UAW needs to dissolved completely. I hope GM goes in a new direction and starts from scratch from the builders to the toilet cleaners. Then they will be able to build quality American cars. Until then pass me the imports.

  19. Auto worker says:

    Two things commonly misunderstood by General Public and media:
    1. US Auto companies are failing because they could not produce modern cars
    2. Management screwed up by giving UAW what they wanted

    For the the end result, these statements might look true there are very coarse reasons behind them.

    Statement # 1:

    US Auto companies has been producing world class for over decades and piling up awards by reputed firms JD Power and magazines. But general public and media very did not stop bad mouthing them even after they had a turn around now some time ago. I have seen people actively criticizing while they never owned an american automobile.

    Result of an unfortunate animosity between media and Auto Industry.

    Statement # 2:

    Here is a kicker, majority of GM, Ford & Chrysler management was hourly once and still has relations in hourly work force. At time of negotiations, guess where sympathies would be. This situation is not as bad now as it used be when those unbelievable contracts were written.

    There is no doubt that many UAW member take advantage of their companies by NOT being a good producer, contributor or good employee. Even now an ordinary UAW worker couldn’t careless about what happens to the industry, their contract ensures them some 94% while staying at home or vacationing when plants are down. This can change if a federal judge throws the contract out upon request. But it will never be requested as it was never requested when Delphi filed bankruptcy.

    Will anything change without a acute surgical procedure. The answer will be NO.

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