GM

[Cymaster]

I apologize if this has been discussed already......

I was just flipping through the channels, and came upon CNBC talking about GM. Now, I may have come into the middle of something, and I have been out of the loop lately trying finish out school and find a job, but I can't believe the point of discussion I'm hearing.

The only thing they seem to want to discuss is the quality of GM vehicles. WHAT???? Regardless of the quality of the vehicles, that isn't GM's problem. It is their production processes, and their labor and pension programs. At least that is my opinion.

Am I right or am I way off base? Is the quality the real problem the rest of the country sees?

 

[DJK15]

I think one of their main problems is having several branches that all make the same car with a different badge on the grill.

 

[Cymaster]

I think one of their main problems is having several branches that all make the same car with a different badge on the grill.

Yeah, I could go with that, too. I was just wondering whether the rest of the country actually viewed it as a quality problem, which is what I took out of the segment I saw....

edit: at the same time, a lot of people are loyal to brands, even if it against another GM brand or not

 

[CyCloned]

No, the problem is the quality of the cars. Toyota, Honda, and Nissan all make better cars because they use better materials, because they have 1/2 the labor costs in each vehicle,and they put the extra money back into the vehicle. Add to this the fact that they are way ahead of the big 3 in production tech, and it is a total butt kicking.

 

[Cyclonesrule91]

Definitely the labor and pension agreements that have them by the manhood. A few things I have heard since this big 3 bailout talks began that prove the point.

- $2,000 of every car coming off the line is for retiree's pension and health benefits.
- If a GM employee gets laid off during a slowdown period, they still get 90% of their wage plus unemployment benefits.
- If a GM plant closes then employees at the closed plant still get eith 90% or all their wage for 2-3 yrs even if they are offered a position at another plant and refuse that position. What sort of idiot management would sign off on that.
- Either the Ford or Chrysler CEO works at Detroit but still lives in Seattle. The company lear jet comes and picks him up Monday morning and flies him to work where he works during the week and then has the lear jet take him back home for the weekend and sometimes once during the week. Oh and did I say that a round trip flight on the lear jet cost $20,000.
- The union environment itself has brought down the big 3. Any outfit that bases pay of tenure and not on performance is not good for their employer. No performance standards and as long as the employee shows up for work then it is impossible to fire him/her. No wonder we are shifting production oversees to workers hungry for a job.

 

[Cymaster]

No, the problem is the quality of the cars. Toyota, Honda, and Nissan all make better cars because they use better materials, because they have 1/2 the labor costs in each vehicle,and they put the extra money back into the vehicle. Add to this the fact that they are way ahead of the big 3 in production tech, and it is a total butt kicking.

Ok, I guess I'm wondering what the "extra money" is getting you when they put it back into the vehicle. When you make a statement like, "half the labor cost" (which I am not surprised), it plays right into my understanding that it isn't the quality of the car, but the manufacturing processes, and their labor and pension costs.

 

[jumbopackage]

Ok, I guess I'm wondering what the "extra money" is getting you when they put it back into the vehicle. When you make a statement like, "half the labor cost" (which I am not surprised), it plays right into my understanding that it isn't the quality of the car, but the manufacturing processes, and their labor and pension costs.

It's certainly the quality of the vehicles, at least in the past. Sure GM makes a couple of good cars, but they still pump out a lot of crap too.

Their labor costs are roughly 70 dollars/hour. Of that more than half of it (40/hr) goes to support legacy costs. They are walking into the game at a huge competitive disadvantage in labor costs, which they simply can't make up without cutting corners somewhere when the competition is just as, if not more, efficient at producing vehicles as you are.

Those corners are, generally, a lack of innovation (engineering), using lower quality materials, and just an overall lack of attention to detail.

Toyota views vehicles that are "average" in quality/reliability as a crisis. GM views it as an accomplishment.

That's the difference right now.

 

[acody]

I think one of their main problems is having several branches that all make the same car with a different badge on the grill.

Excellent point. I've wondered about that for years. I would call that the opposite of streamlining. Producing essentially the same product, yet incurring the huge expense of manufacturing and marketing a different brand. Crazy. The Big 3(they're really the out of touch 3) had the car market by themselves for decades. It just took a few more decades for the foreign guys with much better business models, i. e. much lower production costs and superior products to leave them in the dust.

 

[Cyclonepride]

I apologize if this has been discussed already......

I was just flipping through the channels, and came upon CNBC talking about GM. Now, I may have come into the middle of something, and I have been out of the loop lately trying finish out school and find a job, but I can't believe the point of discussion I'm hearing.

The only thing they seem to want to discuss is the quality of GM vehicles. WHAT???? Regardless of the quality of the vehicles, that isn't GM's problem. It is their production processes, and their labor and pension programs. At least that is my opinion.

Am I right or am I way off base? Is the quality the real problem the rest of the country sees?

It's all interrelated. If you are stuck with absurdly high labor costs, in order to come to market at a competitive price point, you have to cut costs somewhere and in most cases, quality suffers.

 

[kingcy]

No, the problem is the quality of the cars. Toyota, Honda, and Nissan all make better cars because they use better materials, because they have 1/2 the labor costs in each vehicle,and they put the extra money back into the vehicle. Add to this the fact that they are way ahead of the big 3 in production tech, and it is a total butt kicking.

GM makes good cars, so does Ford. At a point in the 80s Toyota was kicking GMs and Fords butt in quality. GM and Ford corrected that problem and now produce equal quality cars. They are still stuck with the myth of poorer quality. As for the labor costs and the production tech ask the UAW about that problem.

 

[LindenCy]

GM makes good cars, so does Ford. At a point in the 80s Toyota was kicking GMs and Fords butt in quality. GM and Ford corrected that problem and now produce equal quality cars. They are still stuck with the myth of poorer quality. As for the labor costs and the production tech ask the UAW about that problem.

I have to agree that they have caught up in large part with quality, but the union is killing them. I don't blame people for buying a Toyota, Honda, etc. as these are great cars, but GM is a lot better than it was 10 years ago.

 

[jumbopackage]

GM makes good cars, so does Ford. At a point in the 80s Toyota was kicking GMs and Fords butt in quality. GM and Ford corrected that problem and now produce equal quality cars. They are still stuck with the myth of poorer quality. As for the labor costs and the production tech ask the UAW about that problem.

It only took one big incident to ruin the reputation of the White Star Line too....

 

[Wesley]

Definitely the labor and pension agreements that have them by the manhood. A few things I have heard since this big 3 bailout talks began that prove the point.

- - Either the Ford or Chrysler CEO works at Detroit but still lives in Seattle. The company lear jet comes and picks him up Monday morning and flies him to work where he works during the week and then has the lear jet take him back home for the weekend and sometimes once during the week. Oh and did I say that a round trip flight on the lear jet cost $20,000.
-

Similar to Nancy Pelosi's Lear Jet.

 

[LindenCy]

It only took one big incident to ruin the reputation of the White Star Line too....

True enough...Titanic?