Delphi Proposal to Cut Wages in Half!

Delphi, which supplies suspension systems for the Mini and Range Rover

If American corporations have their designs on Third World wages for
American workers, they'll be looking at general strikes as are seen in
parts of Europe.

Golden parachutes? A general strike will bring corporate America to its
senses. Executives should be pink slipped on Friday for Monday's
uncompensated layoff.

If you think Mexican or Chinese auto parts will cost you less, you're sadly
mistaken. You'll pay the same price for them as if American workers made
those parts. Labor costs have nothing to do with your price. Profits have
everything to do with your price. As labor costs go down, profits go
up...the price remains the same!

 

Unfortunately, this will not happen. American workers have been doped
up with corporate butt gas and Jesus Juice-they voted to put their
economic well-being junior to Republican conservatives' re-election
because of abortion, gambling and gay marriage. These issues brought
about substantial debate, with the unofficial Republican line being
that God would smite America for these abominations unless voters kept
Bush, DeLay, Santorum, and other fundaloony corporate fellators in
office.

Apparently preferring starvation to divine smiting, they did.

 

What pray tell are you referring?

What is "Jesus Juice"?

While you are at it.
What do the Democrats and Independents do wrong?

 

If they don't, there won't be any strikes because they won't be any jobs.
The US is competing against 3rd world countries for jobs. BTW, even at a cut
of 50%, the wages are far higher than the wages in 3rd world countries.

Jeff

(...)

 

Your are REALLY mistaken. It is all about labor cost with a auto built
here. Labor costs are bleeding them dry and it is reaching critical
mass. I have watched a lot of companies fold or go under because works
want more money than is availble. There are harder times on the horizon
for them and it is not about politics but about supply and demand and
competing with price of your product. The airline industry is going
throuch massive cuts now too because of costs and decreased revenues.

 

Yes, but it also costs a lot more to live here than in those 3rd world
countries -- certainly for housing, and maybe even for food. And in many
3rd world countries there is still a local market at which to buy food,
whereas here one needs a car to get to the supermarket, public transport
systems not being the greatest in the world.

BTW, I heard recently that the US is competing even against Canada for
jobs, because there employers don't have to pay astronomical costs for
health insurance for their employees.

Perce

 

Do you feel that we should all get paid third world salaries?

Labor cost is a big factor in any business but so is production cost for raw
materials and other operating expenses. The company I work for has global
locations all around the world. We have very few expansion in the US for my
company but are going overseas to China. They are building massive size
plants with double or triple the capacity of what we can produce. Cost per
pound goes down with increase production. Why are they doing it has less to
deal with labor cost but more with taxes, benefits paid, environmental
permitting.

They are building plants with less automation and computer control so they
need more people to operate them They pay less per hour wages and very
little in benefits. I went to Mexico to help start up a plant and they had
10 workers for every one in the US. They had less concern with safety and
environmental issues. I saw three workers die and the plant manager went
with government representative to the family home and presented them with a
check equal to about ten thousand dollars. The family was happy and 100
other folks were waiting to take that person's job.

The only workers getting richer is the CEO's with their massive salaries and
benefit packages. They downsize companies and layoff hundreds of workers
then they get a big fat bonus. When they get fired for bankrupt the
business they get a nice big severance and the worker on the bottom of the
totem pole barely gets enough severance to make ends meet for a few weeks.
Then the CEO goes to work for another company thanks to his buddies on
another board of directors and he starts collecting another big fat pay
check.

CEO need to pay the workers that actual do the work for the company what
they are worth and stop ripping of the company with their outrageous
salaries and incentive plans.

Taking a 50% pay cut is a little steep in when the CEO keeps getting raises.
Delphi made bad business choices yet the CEO got rewarded. J.T. Battenberg
III had a 67% increase in his pay from 2001 to 2002 while the company lost
money.

They are claiming bankruptcy due to bad business decisions and poor
planning. Their biggest customer is doing poor also and they failed to seek
out more customers. The union agreed to reduce starting salaries of new
employees while maintaining present employees at the same pay. See
www.uaw.org/news/newsarticle.cfm?ArtId=263 for contract agreement.

Delphi will ask the bankruptcy courts to allow it to eliminate its pension
just like United Airlines. This will free up millions of dollars that could
be used for debt. All the workers and retirees will see their pension cut
by at least half if not more once the governments pension guaranty takes
over.


Sarge

 

Delphi execs get boost in severance pay
http://www.freep.com/news/latestnews/pm6516_20051007.htm

The boys at the top get more money and the working man gets less. Sounds
like the Bushism is working.

 

When we vote for politicians who sell off America's jobs in bulk to the
lowest offshore bidder, then yes, that is exactly what we deserve.

 

And what do you propose as the alternative?


The amazing idea that we should at the same time respect all other cultures
and allow unfettered immigration, while hobbling local industry with
environmental and health-related legalities, but somehow prevent cheap
goods from nations that dont bother with such, is amazing beyond belief.

Meaning: All you can do is complain, the only answer from ANYONE is either
adjust or go to a world-wide socialist centrally planned economy.

and we all saw from Katrina how well THAT works.

Would you mind going back and seeing that GM, itself was the author of this
conundrum in the late 40's when it started down the road to cradle to grave
security for its workers?

I thought not.

 

Wrong, the employers in Canada have to pay the Government for healthcare.
Any employer be it 1 employee to thousands, has to pay for the healthcare of
all employees. So don't make comments that you know nothing about.

 

In Canada (specifically, Ontario):

Employer health tax is paid by the employer based on 1.95% of the
employee's pay (it does not come out of the employees pay). There is
no ceiling or limit on this tax.

Ontario health tax is a new tax (about a year old) and it does come
out of the employees pay (basically between $500 and $1000 per year,
scaled to pay).

WSIB (worker's comp) is also paid by the employer, and is determined
by the perceived risk of the nature of the business. The lowest rates
(office-type worker, computer programmers, etc) work out to about $125
to $150 per employee per year (30 cents per $100 of earnings, topping
off at something like $60k). Other types of jobs (say, building
demolition, construction industry, etc) pay much more.

The above numbers are for small businesses. I have no idea if they
are the same as large auto companies.

One thing is for sure. In Canada, it's ->less complicated<- to run a
business vs the US. Employers don't have to negotiate and deal with
health insurance plans. Stuff like dental, optical, chiropractic, ok
sure, but that's peanuts.

 

You can blame the American manufactures all you want but the problems in
this county are caused by the consumer. The problem is domestics
manufacture have to compete with foreign manufactures who can build their
vehicles in other countries that have far lower wages and far less costly
government regulations on how they must run their business. In addition
they need to compete with those foreign manufactures, like Toyota, who
merely assemble their vehicle in the US, using lower paid workers who
receive fewer benefit, of mostly lower cost imported parts. The greed of
the American consumer had led them to buy more and more lower cost imported
products yet expect to continue to garner higher American wages and
benefits. Something has to give. Unlike Japanese consumers, who support
their own economy, the American consumers in their greed are not likely to
support American manufactures by paying higher prices to maintain their own
economy. American manufacture more and more are being forced to do what the
consumer is doing by going to those same sources to lower their cost of
making their products. If American consumers are willing to buy foreign
goods over American made goods they are going to be forced to accept lower
wages from their employers, or worse, they will see their employer go out of
business or move their production to lower priced countries, as well.. If
American corporations start building their products off shore, as well, at
least we will still have American corporations paying federal cooperate
income taxes on the profits made in the US. That is far better than some
foreign company taking all of their profits out of the county along with the
American jobs, as is currently the case. Middle class Americans better soon
wake up or the only thing your grandchildren will need to know to get a job
is how to say 'Do you want fries with that?' or 'Welcome to Wal-Mart.'

mike hunt

 

I hardly call 70 or 80 bucks a hour in wages AND benifits getting too
little. They do no realize the big "raise" thy get every year because of
the health care insurance that they do not pay for directly.

 

Fact: Health care in the USA is the most expensive in the world, bar none.
Next most expensive is Switzerland, at an average of about one half that of
the
USA.

Neither the workers nor the industrialists can help this. The freaking
government
could, but is too much in the pockets of the medical lobby.

Neither do Americans have the access to quality care as we have been told to
believe. We brainwash ourselves, with the help of the gummint, to believe
we have all the best, but that doesnt hold water.

GM is is deep caca too, and is evaluating the advisability of taking
bankruptcy
just behind Delphi.

 

Delphi supplies General Maintenance (GM). GM was/is Delphi's parent.
Wouldn't bother me one bit if both went out of business. They should be shut
down.

Larry
Behold Beware Believe

| Golden parachutes? A general strike will bring corporate America to its
| senses. Executives should be pink slipped on Friday for Monday's
| uncompensated layoff.
|
| If you think Mexican or Chinese auto parts will cost you less, you're
sadly
| mistaken. You'll pay the same price for them as if American workers made
| those parts. Labor costs have nothing to do with your price. Profits
have
| everything to do with your price. As labor costs go down, profits go
| up...the price remains the same!
|

 

I blame the absolute greed of the uaw worker, they put themselves in this
predicament. Does someone putting a nut on a bolt deserve $27/hr plus
enough O.T to make 6 figures a year? F no. I feel for the real skilled
workers in this country struggling to survive, not the overpaid uaw worker.
When you have janitors making $100K a year something is going to give.

 

We're paying more than that (i.e., more than $1000 *USD* per *month*)
for health insurance and still have significant co-pays.

In Australia (so a businessman from there was telling me recently) the
most anybody pays for health insurance is 2.5% of income -- and that
covers the retired and unemployed as well.

Perce

 

Good healthy thread.

Health Insurance, Canada, Unions and the UAW.

As much as I'd like to blame this current President, he's got *nothing* to
do with it.

But, cannot say greed and the consumer are really what's at play. That's a
malapropism.

Mr. Curious

 

First Delphi....then GM....and then Ford in 2006.....
Just WATCH AND SEE. Oh, all you GM and Delphi
retirees had better get used to no health coverage
or that nice monthly check in a short time also.

Here is a DIRECT Quote from the IF Newsletter 5 Months ago:

"You may not want to believe it but our economy
has been in disintegration since 1989 and only
one trick after another has salvaged it. Just look
at the dollar. It is only reflecting the collapse of a
once great economy. Soon the US dollar will cease
to be the world's reserve currency. We have major
corporations on the verge of bankruptcy, GM is a good
example. As GM goes, so goes America and what is good
for GM is good for America. Its debt will shortly be junk.
Its supplier, Delphi, along with GM, is under investigation
and will precede GM into bankruptcy. Potential retirees
and pensioners are going to be in for a big surprise - l
ike the loss of 65% to 75% of their pensions. GM has
$50 billion in debt to refinance over the next 20 months.
We do not believe the market can or will want to handle
it. The market cannot even handle the Treasury
refinancings. That means interest rates have to
move, jeopardizing the future of the housing market and
complicating and increasing the cost of debt service.
There are many more complicating factors that are
going to be moving into the forefront in the weeks
and months ahead. Prepare yourself - it will be a difficult journey. "

(The above was written in June of 2005)

DELPHI USA IS DEAD - GET USED TO IT UAW BUNKIE !!

GMAC, General Motors Acceptance Corp., contributes
about two-thirds of GM's profits. After three years
of $5,000 rebates per car, which was double the sector
average, car and truck sale growth is falling. GMAC's
$260 billion debt is larger than all of that of the auto division
combined. As you saw in the last issue, GM's euro bond
issues are trading at a yield of over 11%, which is certainly
junk quality. The money maker GMAC is faced with
declining vehicle sales and has been a major investor in
Fannie Mae and Freddie Mac mortgages, thus, as interest
rates rise and home prices fall, paper quality will come
into question and mortgage volume will dry up, especially
in cash outs and home equity loans. GMAC is facing a
double-edged sword. At GM the most profitable sales unit
is the SUV and with today's gasoline prices, they will suffer.
Sales overall for January and February were off 11% despite
having lowered prices in February. As you can see, the
market is simply saturated with vehicles. GM lost $2.6 billion
in Europe last year via Vauxhall, Saab and Opel and is
laying off 12,000 workers. Since 1980 the auto workforce
has shrunk by 70% due to deliberate de-industrialization
and, of course, thousands of smaller firms supplying the
industry have been phased out with massive job losses.

In 2006, GM either will pay off or refinance $44.7 billion
in debt and Ford has to do $37.1 billion or $174 billion
in debt. Can the market handle that at junk levels or will
they want too? That could be bonds with a 13-14%
coupon. Will financial firms, such as GMAC continue the
hobby of producing cars? We don't think so. Can you see
how deadly offshore production, outsourcing and
free trade and globalization has been for America?
Our industrial heartland has been destroyed. Fundamentally
both GM and GMAC are on a path to destruction as is Ford.
Borrowing costs have just jumped from 7.5% to over 11%.
Can they generate cash at these levels and still make a
profit? Delphi, the GM parts spin off, is now embroiled
in an Enron-type fraud scandal, which could indirectly
reflect on GM. Delphi has already informed 4,000 of its
salaried and retirees that it is ceasing to pay their health
care plan. GM and Delphi layoffs are over 10,000.
Suppliers are already at junk level and can only borrow
from GMAC to stay in business. Ford's Visteon is in
the same boat. The UAW is on a two-tier wage system
to save money and avoid layoffs.

If all of that wasn't bad enough GM's pension fund is
underfunded by $17 billion or is only funded to 80%
of its obligations. This comes as George and the neocons
push pension reform, better called, funding your plan.
This is a debt bomb and Washington knows it.
If reform passes Congress for the benefit of the
Pension Benefit Guaranty Corp., many companies
will achieve junk status. GM wants to split off GMAC
hoping to save GMAC. If that happens this year it is
guaranteed GM will go into bankruptcy. PBGC is
already $23 billion in debt and can not absorb the
obligations to GM's hundreds of thousands of
pensioners. This is a disaster of major proportions.
Plus, they'll lose GM's pension insurance premium
payments. Even if GMAC is spun off we do not believe
they will escape attachment by PBGC. It should have
been spun off three years ago.

(Of course Delphi Mexico and Asia will still be in business.
Delphi USA and it's retirees are going into bankruptcy.
Enjoy the ride folks! Money is GOD)