labor charge-by the hour or book???

Since the supplier that I worked for supplied to Ford/Visteon and
GM/Delphi, but not to Chrysler, I can't dispute that. While I can't say
that that didn't happen at Ford or GM, I can say that I never saw any
evidence of that. Cut cost where you can (and sometimes even where you
can't), but not to intentionally design all enginerring safety factor
out of it to intentionallly make it fail earlier). IOW, while it may
have been the culture at Chrysler, I can honestly say that I saw no
evidence of that type of culture at Delphi or Ford).

While Ford's 5% per year mandated reduction in parts cost from suppliers
(that truly was mandated - some years even more than 5%), was
unconscionable, in their defense I will say that some of their costs,
such as employee health insurance, ate up a lot of savings, as it has in
all businesses. But it does seem rather hypocritical of them to expect
a supplier, whose unavoidable overhead costs are also going up, to
absorb such costs while at the same time dumping more and more costly,
often-times non-value-added bogus quality-control programs onto the
supplier (another source of cost increase to the supplier). The
inevitable result was that the supplier, in order to stay in business
would fake the quality programs to cut down on number of employees to
run them, and the amount of resources that remained to maintain true
quality measures were grossly inadequate. This resulted in quality
spills and even greater costs shoved back onto the supplier (Ford simply
issued an accounting of their costs associated with the quality spill
and deducted that amount from outstanding invoices). So now the
supplier has even less margin from which to improve their quality
systems, if they are not already in the red. Remember Firestone tires
on the Explorers?

Contrary to your numbers, the downward spiral of that scenario has
proven to impact Ford's profits. Instead of it resulting in their sales
increasing faster than their costs, quite the opposite has happened
(i.e., profits are **WAY** down).

Not true. GM has plenty of their own tricks to screw the supplier
(witnessed first-hand). Ask your friend who works at Chrysler what
"Lopez'ing" is. I bet he knows - and Lopez left GM several years ago to
go with VW, yet the term "Lopez'ing" is still standard lingo in the auto
manufacturing biz for underhanded contracting techniques. GM was so
proud of the supplier-screwing techniques that Lopez developed while at
GM that when he went to VW, they (GM) sued him to prevent him from
transferring the same techniques to VW. He ended up doing some hard
time, but I forget what that was for - maybe not related to his
techniques.

One of GM's "screw the supplier" techniques: PICOS. That's where they
have your company (who is currently making a part for them) spend many
man hours and $$ traveling to meet at their facilities and also hosting
them at yours for several two-, three-, and four-day meetings,
brainstorming how to improve and cheapen a product and manufacturing
process - this is all done with the absolute up-front promise that they
will not put the part out for competitive bidding at the end of the
process, and that you will share 50/50 in any cost savings that result
from the joint effort. And then, when you have the parts and process
drawings all updated with the money-saving improvements that you spent
lots of money helping them come up with for mutual benefit, they
circulate the new drawings that you helped develop with the improvements
to all of your competition and ask for competitive bids. And guess
what? If you want to keep the business, to stay competitive, you have
to cut your price and loose all the savings that they promised you at
the beginning of the PICOS process that you would share in - if you
don't bid with *ALL* of the savings taken out, your competition will
outbid you and you lose the business. When you bitch to their contracts
people, their response is "Well, no problem, go ahead and keep those
future cost savings in your price if you want to". Modern business
ethics at its best.

Also, I saw an incident in which a supplier refused to cut their price
to GM in ***the middle*** of a supplying contract, and, in retaliation,
GM put them on their supplier black list (i.e., existing business stays
as is, but no *new* business allowed to be let to that supplier until
they are removed from the list). Could the supplier sue? Sure, and
possibly even win - but then that will be the last piece of business
they would ever get from GM, and possibly from Ford too - so they
possibly would win the law suit, but would end up going out of business.

Reminds me of a story I heard one time from a person. Seems that he
notified the buyer at Delphi that a mistake had been made on a recent
quote - that the price that was going to be charged to Delphi for the
part should have been higher. The buyer's response in effect: "Hey - a
deal's a deal - you already quoted it - that's what you have to sell it
to us for - too bad". The supplier had its people go over the numbers
with a fine-toothed comb to better understand the mistake and see if
maybe it wasn't as bad as originally thought. Lo and behold, they
discovered that - yes - an error had been made on the quote, but instead
of the price being to low, it was actually too high by very close to the
same amount. They picked up the phone to notify the buyer, but paused
long enough to remember his words: "A deal's a deal...too bad", and said
to themselves "Darn - I guess there's no use telling him about it -
after all - a deal's a deal". They put the phone down. True story -
funny though - I can't remeber that guy's name who did that.

Bill Putney
(to reply by e-mail, replace the last letter of the alphabet in my
address with "x")

 

I should have included in there that the so-called "quality" improvement
programs were often anything but. Much of the time, rather than having much
if anything to do with true quality, the intent was to provide documentation
to point back at the supplier if *anything* went wrong. This was because
Ford knew that the supplier had no way of producing a quality part at the
price they were paying, and therefore, if the supplier was still in
bussiness, they had to be faking the quality process, with the inevitable
result being that their would, at some time in the future, be a quality spill
and a line shutdown. When that occurred, the supplier would turn over the
loaded gun (i.e., process documentation) that would prove one of three
things: (1) The supplier had faked the quality documentation (i.e., the
documentation shows that the parts were in spec., yet the parts out of the
same lot that arrived at the customer were shown to be out of spec. when
analysed), or (2) The supplier knowingly shipped defective parts, as the
documentation shows, or (3) The documentation showed the parts and process to
be out of control, but the supplier was simply documenting the numbers
without paying attention to the fact that the parts that were being produced
were bad.

No matter which of the three had occurred, the supplier had no defence when
Ford deducted all of their costs related to the spill from current invoices.
How can the supplier complain? After all - they produced and shipped bad
parts! Bad supplier!! And guess what. The same quality spill would occur
again a few months later, since they were now in an even worse position to
maintain or add the resources required to really fix the problem. Downward
spiral.

Bill Putney
(to reply by e-mail, replace the last letter of the alphabet in my address
with "x")

 

Because one thing can't be helped - as the sub-contractors outsource
more and more and cut corners, quality goes down.

Meanwhile VW and Hyundai are offering 10/100K warranties and
eating into the non-fleet sales.

I meant the 5%. GM does tons of other crap.

I can see it now. Wal-Mart pulls crap like this, too. Most companies
do as there is little that they suffer from such practices.

Wal-Mart is famous for this, in fact. The only real solution
is to not get in bed with them in the first place.

At this point, they are likely dead anyways. Their mistake was
putting too much of their buseiness with one client.

 

All that is nasty but I don't have much sympathy for these suppliers. Let
me tell
you my story.

2 years ago we got a call from one of the largest suppliers to a major auto
manufacturer of rubber window gaskets. (I won't say who this is or who the
auto manufacturer, but the particular automaker has built an entire
marketing
scheme on claiming to have the safest cars in the industry)

These guys had a 5 node 64k WAN that spanned the western US. They had
bought this from Sprint and had 4 problems. First was the contract was up
for renewal. Second was they wanted more bandwidth cheaper. Third was
Sprint was no longer supporting 64k frad gear on wans and they wanted to
add in 2 more offices. Fourth was the manufacturer of the frads they were
using
was out of business, and the guy that set the thing up for them 4 years
earlier
wasn't in business, and nobody they talked to in the industry knew what the
flock the devices were that they had, nor did they know how they worked, nor
did Sprint's own engineers even know how the circuits were provisioned as
it had been years since a Sprint engineer had done one. Not to mention the
local loop providers in the cities they wanted to bring up didn't offer 64k.

They had gone shopping the major carriers all of whom were quite willing to
way undercut Sprint's contract renewal price, and had SIGNED a contract with
AT&T to do a replacement wan. Only problem was AT&T told them to
get their own designer and equipment and build the new wan in parallel, then
when it was up and tested, cut everything over. That was where we came
in, we were referred by AT&T.

Well let me tell you for the next 2 weeks I personally created the
replacement
design, and costed it out to the penny. They had no drawings or anything
not
even the passwords for their existing devices and it took hours and hours
digging
and e-mailing people on the Internet to get documentation on the devices,
plus break into them all and do discovery to get all the numbering and such
of the trade to do the work. And on top of that these devices were
unbelievably crude.

At the end of it they started squawking on the price, we went back and
forth, knocking this and that down. By the end of it I had a quote that
used entirely used Cisco gear, fetched from Ebay if you can imagine. Then
they
started squawking about labor costs, they figured our labor was going to
be paid by AT&T. (no such thing was in the contract of course)

Well let me tell you how it ended up. These turkeys went back to Sprint,
signed a renegotiation contract, changed their business plan to dump these
2 new offices, then attempted to break the AT&T contract. Last I heard
AT&T had them in court. We are talking about a $100K termination
penalty on this contract. I read a copy of the contract myself and it was
all standard Telco boilerplate, there was no effing way they were going to
get out of it. We of course never got paid by them, although AT&T did
send us a grand for our time, which was pretty much appreciation money
you might say, as by then I had dumped probably 100 hours into this.

So, no I don't have much sympathy for people who do business
like that.

Ted

 

this is called flat rate and this is how techs get paid and like i have said a
hundred times here, it's a rip off and it needs to go! been around since the 30's
mechinacs need to get paid like the rest of the world and more car would get fixed
correctly the ones that make out are the owners and dealers not the customers

 

Agreed. And that is what makes it such a nasty business as a supplier.
The customer has too much leverage - no balance of power, and that is
always bad unless the leveraged party is benevolent, and we know that's
not the case. But that is inherent in doing business as a manufacturing
supplier in the auto business. You might actually be selling the part
as a third-tier supplier to a second tier, so you actually do have
multiple customers on paper, but the quality systems and politics (and
financial dependence) come straight from the first tier of which there
are only two in the U.S., so in effect your future is dependent on the
relationship with the two.

The only defense for the supplier is to become as ruthless as they are
and beat up your own suppliers and your employees. It's a matter of
survival, in which otherwise decent people become ruthless.

Bill Putney
(to reply by e-mail, replace the last letter of the alphabet in my
address with "x")

 

Whoops, try again, reading slower this time. The 200,000-plus mile
durability of the AA-body cars, to say nothing of the AS-body cars (Come
up here to car-hostile Toronto sometime and you will be amazed at how many
ultra-high-miles first- and second-generation Chrysler minivans are still
in good shape and in reliable daily use).

First failure is Chrysler's fault. Subsequent "every 30-40K" failures are
due to improper rebuild procedure (typically indifferent "factory reman"
crap)

For people who trade their cars every four years or so, sure.

Can't say I've ever paid $300 for a module, and I've owned Chrysler
products made from '62 through '97.

Pish. I've driven late-model Chrysler products over 100K miles before
needing to replace the engine mounts. You're making shit up as you go
along.

Go find the nearest Accord and tell us what the radiator tank is made of:
Yep, the same plastic/aluminum construction that is virtually universal
throughout the auto industry and has been for nearly 15 years.

Oh, I agree with you there.

Whoops, try sounding out the hard words. Like "Car".

How many '86 K-cars do you see still on the roads? A lot more than you see
'86 Subarus or Accords or Camrys.

DS

 

This is true, I see a lot of K-cars around in reasonable condition, as
compared to 80s Japanese cars. And I'm in rust central. There's even an 83
Aries nearby.

Plus I still see billions of Acclaims and Spirits around in very good
condition. Worst I see is the light blue ones peeling. They seems as popular
now as they were 10 years ago.

I know someone with a 1993 Spirit. He bought it as a buyback for half the
price as a new one. He's still driving it every day.

 

My 96 GV is about to roll over 150K and still looks and runs fine.
Almost no rust after 8 NY/PA winters. A couple spots on the lower edges
of the doors where the stones from the road has chipped the paint and a
little bubbling starting under the paint on the lower edge of the rear
hatch door. Engine and tranny are both original with no work beyond a
water pump, starter and hoses, belts and other maintenance items.

In the early days, maybe, but I think today the main fault is the
owner's driving style and/or lack of proper maintenance.

My GV still has the original engine mounts, sway bar bushings and
struts. The sway bar bushings are bad though and I'll get them replaced
next visit to the garage.

I agree on Ford, but current GM cars and trucks are quite good for the
most part. I've owned both Dodge and Chevy trucks, and I'll take a
Chevy when it comes to trucks.

I don't see many of any of them around here. The road salt combined
with PAs fairly stringent body inspection requirements pretty much takes
most cars off the road by the time they are 15 years old.


Matt

 

Well, I know you like Chrysler products, and I grew up with them, but
*my* experiences with a '91 Voyager were not good. The tranny failed
at 35K, repaired by Chrysler, failed for good at 90K. The engine (3.3L
V6) had a rocker-arm assembly break off the head at 95K, died at 110K
due to camshaft bearing rotation that blocked oil journals.

Every interior body panel rattled and had to be re-tightened at 25K
intervals.
Etc, etc. I couldn't sell it; had to donate it because of the bad
reputation
of that model.

Now, ask me why we bought a '99 to replace it - great utility. We also
bought a 100K warranty.

Floyd

 

"Bill 2" wrote

Personally, I love the Chrysler K-cars, and/or whatever else has the
same basic configuration. I have two of the little suckers right now,
just bought one of the kids a 90 Acclaim. These cars are cheap little
tin cans, but they are cheap to run, easy to fix, and are actually quite
reliable little cars. I have to throw a transmission in my own K-car,
but it was an abused car when I got it for $100 dollars. Since then,
I've done very little to it, other then the obligatory head gasket
replacement. That took all of 45 minutes to replace. I found a
nice used trans for a couple of hundred dollars, so I'll slide that
in some time soon.

Plus, the local "pick your parts" is chock a block full of K-style
cars, so you can easily pick up all sorts of parts for next to nothing.
I had a MAP sensor go south on me recently, paid $2 for a nice
used one and away I went. Certainly better then the price they
wanted for a new one.

Ian

 

Speaking of '86 Subarus, I've posted here occasionally about an '86
Subaru turbo wagon that I sold in early '03 still with the original
engine and turbo unit at 275k miles running as strong as it ever did.
It lived the first 7 years of its life in Denver, and then we moved to
Virginia in '92 where it has been ever since. I had had the dog legs in
the frame at the bottom of the firewall reconstructed at a welding shop
about 8 years ago. The guy who bought it from me e-mailed me about 4
months ago and said he had to junk it due to the frame no longer being
able to pass inspection. He saved the engine, tranny and turbo unit for
a transplant - the rest went to the junk yard. With disk brakes all
around, it still had the original factory rotors, which were as smooth
braking the day I sold it as when it was new - I never even had them
turned.

Probably if enthusiasts such as myself and the guy who bought it from me
had not owned it, it would have been scrapped, engine and all, several
years ago. But it would run 'til the day it died!

My mother-in-law traded in her Reliant-K about 4 years ago. The used
car dealer told us he'd have no trouble selling it - that rural route
mail men loved them and were always asking him to keep there eyes out
for them. Sure enough, he sold it to a mail man the day after he took
it in.

Bill Putney
(to reply by e-mail, replace the last letter of the alphabet in my
address with "x")

 

I assume you are referring to the standard 3yr/36,000mile warranty? Could you
please define "one std deviation above"? I would like to calculate how much
longer I can drive my '93 Grand Cherokee with 192,000 miles on it, or my '96
T&C LXi with 177,000 miles on it, until you can give me the "standard" to which
you are referring. To be safe, I am not going to hold my breath until you do.

RP

 

As they get squeezed tighter and tighter, they are left with
few options if they want to not be collecting welfare checks.

 

Actually, most cars these days reliably last ten years, so
it's "trade their cars every decade"

Be lucky you don't own GM crud.

Again, you are lucky. Engine mounts in FWD cars seem to die
with shocking regularity once the car gets to be more than
7-8 years old.

Smartest thing I ever did with my Buick was to toss the factory
one and get a good 3-row all metal one installed. Plastic and
aluminum radiators are a crime, IMO.

Cost about $300 for the whole job, btw - effectively putting
a HD radiator/cooling system on the car.

Never again. I think my next car may be a Saab or just
get an older classic Volvo like a P1800 or simmilar.

 

4/48K is as much as they are likely to make any part on the car
last at a minimum. Many parts will last longer than this, but
it's not in their interest to make anything that lasts much longer
than the warranty these days.

If a car has a 10/100K drivetrain warranty, though, they are forced
to make it reliable. That's why I respect VW. Their electricals
are crap, but the engines have that long warranty on them. That
shows that they have some faith in their designs.

IME, Ford seems to be the worst in this reguard, but most
smaller budget cars also suffer from this as well.

 

That is the biggest buch of bullcr*p I have heard in a long, long time.

Well, Chrysler now has the 7/70K on the powertrain. GM and Ford don't.

 

Yah, sure - you betcha!

 

Our K-cars were pretty reliable. One had an alternator go out while we were
driving, but we were able to drive to a safe location before the battery
totally died (helped that there were no DRLs). One had the timing belt go.
Thanks to the non-interference design there was no permanent damage.

We had transmission problem once. It would not downshift when the car slowed
down. So we drove it to the shop manually downshifting on the way where it
was covered under the long powertrain warrantee.

One of them had the headgasket start to go before we got rid of it. That was
the extent of any "major" problems.

They were good cars. Very economical, practical cars. We drove all over the
continent with one towing a trailer (we also had no air conditioning)

I always stop and look when I see one parked, and it was one of the displays
I wanted to see at the Chrysler museum. One of my neighbours had one up
until recently and it was a shame to see it go. It was in excellent
condition and still had shiny red paint.

We also went to many a salvage yard to get parts for them.

 

Jesus, Joseph...could you possibly make yourself look any *more* ignorant
and out-of-touch? By your logic, you "respect" Pep Boys for giving a
worthless "lifetime warranty" on their shitty Chinese "all new!" starters
and alternators.

It is quite obvious you live in a drafting-paper-and-textbook world. Here
is a quick lesson in how things work in the real world. Pay attention,
your bank balance is the test: The warranty doesn't mean a damned thing if
the warranted item is fundamentally bad. VWs are fundamentally bad.

GM has some talented engineers in their employ. However, most of the time,
most of their good ideas are beancountered, committeed and focus-grouped
to death and so never see the light of day.

VW has the opposite problem: They exert no restraint over their engineers,
who run amuck, designing systems and components that are uniformly and
pointlessly three to twelve times more complex than necessary. Don't take
my word for it -- go examine the cooling system of a VR6, or the power
steering hose layout on a TDI Golf, Jetta or Beetle. These systems and
components are beautiful to behold on paper and on a tastefully-lit
cutaway display in a glass case where you can scrutinize them while
nibbling smoked salmon and listening to a string quartet. However,
greater complexity means greater frequency of breakdown, and when these
systems and components break down, they are expensive and difficult to
repair correctly.

"Warranty", you say? Sure, ace. Go try and get your VW repaired under
warranty at any North American VW dealer. It doesn't count unless your
recurring problem -- and you WILL have recurring problems with a VW -- are
fixed under warranty at least twice AND the dealer doesn't introduce new
problems and swear he's blameless.

Jesus. You "respect VW" because of their long engine warranty? Idiot.

DS