GM tells Trump that they and the UAW will decide their business

Discussion in 'Latest US & World News' started by Jimbo11, Mar 18, 2019.

  1. ronv

    ronv Well-Known Member

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    You can try and spin it anyway you like, but if it were as simple as model changes they wouldn't lay people off.

    From your link:

    President Trump’s approach to trade relations also poses significant risks to the U.S. automotive industry. Already, the President’s national security tariffs on steel and aluminum have made the United States the most expensive region in the world for these metals – leading to higher prices for consumers and lower profits for producers.

    The U.S. tariffs on Chinese imports expanded to encompass virtually all automotive parts in September, and this, too, will affect consumer prices and profits. Passage of the recently-signed United States-Mexico-Canada Agreement (USMCA) is far from certain as Democrats in Congress seek to strengthen labor and environmental protections in the deal. If the USMCA process bogs down, the President may withdraw from the current North American Free Trade Agreement

    (NAFTA) which will create greater uncertainty for the industry. The Administration has also started the process of negotiating trade deals with the EU, Japan, and the UK – adding to uncertainty and risk for automakers and suppliers. Perhaps the biggest risk to the industry, however, is the potential for the President to impose additional tariffs on imported autos and parts as part of the current Commerce Department Section 232 investigation into whether these imports pose a national security threat.
    Nope. Trump touched it.

    upload_2019-3-20_6-27-0.png
     
  2. Pants

    Pants Well-Known Member

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    Yes you did. It wasn't related to the subject matter of this thread, but hey, let's throw a blanket over it and call it a day.

    You began this discussion by suggesting that they shouldn't have shut down the plant - they should just start producing a more attractive model. Now, you've shifted to saying that this plant is shutting because they are moving productions to other countries. There is no evidence of this...that THIS model of vehicle is being produced in another country...but you keep on believing.

    I don't like that American companies shut down American operations and move them to other countries. But if you believe in capitalism, then you should respect their right to do so. I believe that if they do, they should see significant financial penalties. I think we agree on that. What I don't believe is that the president should be bullying American companies - via tweet. And I'm surprised that you support it...seeing as government control over means of production is a tenant of socialism. And before you say it, I'll pre-empt your Obama analogy of 2009 to say that he provided assistance to an industry so that Americans were not put out of work and an entire industry did not die. Did you oppose that? Did you think he shouldn't have asserted himself into that?
     
  3. ocean515

    ocean515 Well-Known Member Donor

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    Doing something about countries harming the US economy and taking jobs from Americans will cause some short term pain.

    I'm constantly amazed by how little liberal progressives care about job security for workers within the US borders. Seems to me they are more interested in insuring foreign workers remain employed, than their fellow citizens.
     
  4. ronv

    ronv Well-Known Member

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    Closing plants and laying off 10s of thousands is not short term pain.
    If your going to have a trade war you should not tariff your own raw materials. The downstream effect is devastating.
     
  5. ocean515

    ocean515 Well-Known Member Donor

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    Those closures are not the result of trade wars. You think Ford dropped sedans and cut their workforce because the Presidents effort to stop other Nations from screwing the US economy and it's workers?

    Your extreme bias clouds reality.
     
  6. ronv

    ronv Well-Known Member

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    So if they are going to build as many cars (or SUV's) why are they closing plants?
    Are SUV's easier to build?
    It's not rocket science ocean. Divide FORDS profits by the number of cars produced world wide. They really don't have a lot of money to give away on cars, so they drop them in favor of higher margin SUV's.
     
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  7. ocean515

    ocean515 Well-Known Member Donor

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    Umm. Yeah, that's what I have been saying.

    Ford, and GM for that matter, are dropping small cars because their production costs are not significantly different than the cost of producing a CUV/SUV. That is especially true when related to retail sales price and gross profit per vehicle.

    When CAFE was lording over production, Ford and GM have had to manipulate sales, own rental car companies, etc., in order to sell enough small cars to offset the lower fuel millage factors coming from sales in the rest of their production.

    When you're barely making money, or perhaps even losing money, on every small car sold, what is a company supposed to do?

    Toyota, Honda, Nissan, etc., have small car sales, and other car sales, from all over the world. Selling a smaller car in North America, especially from plants that aren't under Union Contract, makes the effort viable.
     
    Last edited: Mar 20, 2019
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  8. Josephwalker

    Josephwalker Well-Known Member

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    GM was and is a bloated old company with outdated union contracts. They should have been allowed to go bankrupt and reorganize into a new age company that can compete in the modern world. That's capitalism. Also GM is not an entire industry, it's one company and if it went under the other more efficient companies would quickly fill the void. That to is capitalism.
     
  9. Pants

    Pants Well-Known Member

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    Of course GM isn't an industry...Obama bailed out GM, Ford and Chrysler - not just GM.

    And hey - I'm all about letting the market forces determine strength and weakness. Just as I am all for GM closing this financial drain of a plant. And seeing where your argument has ended up, I'm assuming you are too. Took you a while, but welcome aboard!
     
  10. ronv

    ronv Well-Known Member

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    There is a Yuge difference between low margins and no margins. What Trump has done is turn lower margin products into losers.
    The auto companies worked around the café standards by going to lower cost manufacturing and Trump froze them as I recall.
    US exports also went in the tank. Expect more in 2019.
     
  11. Josephwalker

    Josephwalker Well-Known Member

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    Ford didn't need funding and if Obama had not bailed GM out Ford would have picked up market share which is how the free market is supposed to work. You say that's what you believe in but your support of the GM bailout indicates otherwise.

    "The Ford Motor Company didn't need the funds since it had already cut costs. But it asked to be included so it wouldn't suffer by competing with subsidized companies. The Treasury Department lent money and bought stock ownership in GM and Chrysler. It provided incentives to spur new car purchases. In effect, the government nationalized GM and Chrysler just as it did Fannie Mae, Freddie Mac, and the American International Group."

    https://www.thebalance.com/auto-industry-bailout-gm-ford-chrysler-3305670
     
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  12. Pants

    Pants Well-Known Member

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    Just so I understand...you are perfectly fine with large automotive companies going bankrupt and huge job losses. But as soon as it comes to those companies heading overseas, you want the government to do something?
     
  13. Josephwalker

    Josephwalker Well-Known Member

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    When did i say I wanted government to do something? Government already did something by bailing out a company that was failing due to an inferior product brought on by outdated union contracts that sucked up all their resources for R&D. They should have been allowed to go bankrupt and reorganize as a leaner company. That was the only way to save GM long term.
     
  14. ocean515

    ocean515 Well-Known Member Donor

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    You have no idea what margins auto companies work on. You should look into it if your interested.

    CAFE stands for Corporate Average Fuel Economy. It's a composite average in miles per gallon for all the vehicles sold by the manufacturer in the North American market. It means when a car that people want to buy doesn't meet the high levels Obama's Administration worked out, they have to sell a tiny car that averages out the number. The problem is, there is little profit in small cars for UAW controlled auto manufacturers.
     
  15. Len_A

    Len_A Active Member

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    Are you still on that full-of-sh*t nonsense?
     
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  16. Len_A

    Len_A Active Member

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    Three members of my family are salaried with GM, two engineers and one assembly plant manager. Most of the engineers laid of were rehired a week later in new positions, all related to either electrification of cars or autonomous vehicles. And more than 90% of the hourly employees laid off, got new hourly jobs at other GM plants.
     
  17. Len_A

    Len_A Active Member

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    Most of Ford's white collar cutbacks are in Europe. Ford is adding 500 hourly jobs, right now, at their Kentucky Truck Plant, and they just announced $900 million in new investment money at their Flat Rock, Michigan assembly plant. Ford also hired a lot of people for developing autonomous vehicles. Ford opted out of building in Mexico, tariffs or no tariffs, because a business can no longer be made for selling small cars in the US and Canada, with the market shifting to crossovers and SUV's. Ford cancel plans to import a limited number of one version of the Chinese made Focus because of Trump's tariff threat.

    GM closed the Lordtown, OH assembly plant because sales of the Chevy Cruze fell to the point where the plant, on only one shift, was deeply in the red. When, under the Obama administration, that plant was running on three shifts, the Cruze's very skinny profit margins barely made the plant profitable. GM gave their Hamtramck, MI assembly plant a six month reprieve, to build out the full size cars, including the Cadillac CT6 & Chevrolet Impala, but it will close at the end of January, 2020, and the only sedans GM will sell in the USA & Canada will be the soon to be introduced, Lansing, MI built Cadillac CT4 & CT5. By the end of 2020, there will be no Chevrolet or Buick sedans sold in North America, and only Chevrolet cars will be the Camaro & the Corvette. There will be zero imports to replace the American and Canadian built sedans being canceled, despite the moronic posts of one forum member.

    And under Obama, new CAFE rules went into effect that give advantages to the all crossovers, SUV's and trucks. There are two separate CAFE standards, one for paasenger cars, a lower one for crossovers/SUV's/trucks. By 2022, the only passenger car Ford will make and sell in North America will be the Mustang, and there will be a high performance hybrid version.
     
    Last edited: Mar 20, 2019
  18. Len_A

    Len_A Active Member

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    Name one car (sedan) GM is importing from China. Just one.
     
  19. ronv

    ronv Well-Known Member

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    In fairness they do import some envision SUVs. But I don't think anymore since the tariffs priced them out.

    GM sold 210,000 Envisions in China last year compared with 42,000 in the U.S., according to the filing. Those domestic sales aren’t enough to support a U.S. manufacturing plant, but GM needs to offer the model to have a complete lineup against brands such as Audi, Lexus and Mercedes-Benz, it said.
    --------------------
    “The profitability that we generate on that vehicle, selling it in the U.S. market, we obviously reinvest in the business here so we think it’s in everybody’s interest for that to continue,” Ammann said.

    You know what they say.. A billion here a billion there and pretty soon you have some real money. :)

    Your going to have a hard time convincing me there won't be significant job loss from the suspension of car sales. When you get in trouble you always cut your worst performers first. Not all of those cars will be replaced with SUV's.

    _________________
    The impact of President Donald Trump's escalating tit-for-tat over tariffs is already being felt, say auto industry experts. New car prices are beginning to rise, and auto exports are dropping. But a new report warns that sales could plunge by as much as 2 million vehicles a year, resulting in the loss of up to 715,000 American jobs and a hit of as much as $62 billion to the U.S. GDP.

    Already enacted tariffs on imported aluminum and steel have added about $240 to the cost of producing a new car, truck, or crossover in the U.S., noted Peter Nagle, a senior economist with research firm IHS Markit. And the first round of tariffs with China is adding still more to the price that manufacturers have to pay for a variety of parts used on American assembly lines.

    In line with the new CAR study, IHS forecasts U.S. new vehicle sales would plunge by around 2 million vehicles annually, to 16.5 million a year from 2019 to 2025.

    With auto sales already declining, manufacturers have been struggling to minimize the impact on consumers from tariff-related cost increases. But, at some point, they will have to pass them on, resulting in higher sticker prices. But consumers are already struggling to deal with their car payments, driven up as the cost of the typical vehicle sold in the U.S. approaches $35,000. Vehicle loans are being stretched out to record levels, with 60, 72 and even 84-month financing becoming more the norm than the exception.

    The escalating trade war with China “will further harm the U.S. auto industry and American workers and consumers," said John Bozzella, CEO of the Association of Global Automakers. "Retaliation by China to tariffs already in place has made U.S. auto exports uncompetitive and will eliminate our bilateral auto trade surplus.”

    The impact of the trade war is likely to be felt in every corner of the auto industry, experts stress, even at the dealer level. The CAR study, for example, estimates as many as 117,000 employees at the country’s 17,000 new car dealerships could lose their jobs.

    Though the Association of Global Automakers said it supports Trump’s efforts to resolve some nagging trade issues, Bozella said he is “concerned that escalating trade tensions will not produce the desired results.”

    https://www.nbcnews.com/business/autos/tariffs-could-mean-2m-drop-car-sales-cost-715-000-n911411
    ----------------------
    Then there is the problem of cost.
    There seems to be some misguided idea that the US consumer will just absorb the price increases.

    upload_2019-3-20_20-0-44.png
     
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  20. AZBob

    AZBob Banned

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  21. Mac-7

    Mac-7 Well-Known Member

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    Remember you heard it here first
     
  22. markjs

    markjs Active Member

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    They paid it back LONG ago, now Ford AKA "****in' owner Real Dumb" is in deep financial straights, not GM.
     
  23. markjs

    markjs Active Member

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    BIGLY, Like YUGE even, The three bankruptcies would occur in RECORD time, and the US Auto industry would cease to be.
     
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  24. Tim15856

    Tim15856 Well-Known Member

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  25. Len_A

    Len_A Active Member

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    From someone who has zero clue what he's talking about.
     

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