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The Jan'06 issue of Playboy (Yes the rumor is true, there are articles :p ) has a very good piece on the current state of the US auto industry.
A couple of points I found very interesting was the use of Japan management techniques by a Ford plant manager and the influence of the German ownership to change the direction of Chrysler.
Another point was the disclosure by USA Today about the $1,500 per unit cost at GM for healthcare which is double the unit cost for steel. I believe most are familiar with this as it has been widely publicized. This point has been further revealed to say GM will spend $5.6 billion on legacy costs- health and retirement bennies- for past and present union members in 2005. These numbers are for 1.1 million workers in this category.
The interesting thing that I hadn't seen published as pointed out by the article, is the benefit package price paid to white collar retirees. GM spends $7 Billion annually for 450,000 retired in this category. The article states how the general media such as USA Today doesn't mention this data, instead pushing the union numbers as the problem.
I'm by no means defending the unions but I think GM management needs to "fess up" to this 7 billion weight.
The article goes on about executive compensation and the crazy numbers these people pay themselves inspite of the ongoing financial failings of the company. An example was how the exec-comp program kicked in during 2004 when the vehicle manufacturing division lost close to a billion dollars. GM's 2004 net profit of $2 billion came from the earnings at GMAC primarily through home mortgages. GM- "The Bank that makes Cars"
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The Japanese use the W Edwards Deming system! we stopped after WWII
http://www.lii.net/deming.html
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What also was pointed out in that article was how overall reliability of the domestics has risen to being equal to the import manufacturers.
The point made several times in the article was that imports are pretty much given a free ride when it comes to defects. Given as examples were the Prius problems and the Tundra recalls. Where as the domestic products wouldn't get off as easy as, in those cases, Toyota.
It was a good article. The 7 Billion in white collar retiremants was interesting, but it's easier to blame the unions than it is a bunch of office workers.
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Its a catch 22 situation. If your blue collar workers are making X, then you will have to pay the executives X+Y, and provide equal or above benefits. During the period that the unions were sucking the benefits up, they had to compete for the executives under the same duress. There is a lot of problems with overpaid executives, but in a lot of cases, it is the white collar workers which decide the future of the business. Not so much at the top levels, but in the accounting, design and management levels. And often, these are the first to go in a rift since they have the least protection.
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The point made several times in the article was that imports are pretty much given a free ride when it comes to defects. Given as examples were the Prius problems and the Tundra recalls. Where as the domestic products wouldn't get off as easy as, in those cases, Toyota.
Good point. I have a 2005 Nissan Titan which along with the Armada has a front brake problem called the "judders". Basically thin rotors and brakepads with wrong composition. The truck develops a bad shake that progresses to almost undrivalbe. Nissan kept this problem very low key for over a year and finally after you made 2 visits of turned rotors they did a new part retrofit on 3. I got mine the on 2 after loudly declaring in the lobby I was buying a Dodge. Parts magically appeared that had been on backorder. Go figure.
They claimed this wasn't a safety issue which IMO is just that, opinion. I guess someone would have to get in a lethal wreck to prove otherwise. Anyway I wonder how GM or Ford would have been treated in the media. The Titan was Nissan's wonder vehicle and they fought hard to alleviate bad pub, once again, IMO.
I personally have no allegiance to any auto manufacturer as I have had enough problems with GM, Ford, and Nissan to the point I question any manufacturer. I just happen to be a loud opinionated customer that will fight for my right to a proper fix so things get corrected. My gripe is that it still takes valuable time to get anything fixed.
Brand allegiance is tough to justify.
