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Originally Posted by Villages Kahuna
I worked for ten years in the auto industry--albeit a long time ago--and my son is an executive with Ford today. There's no question that much of the blame for the weakening of the U.S. auto industry can be laid in the lap of the UAW. Oh, don't get me wrong, the auto company management has demonstrated their own amount of stupidity, as well. They were not aggressive enough in developing, building and selling smaller, fuel-efficient cars when the oncoming and ongoing increase in dependence on foreign oil was obvious. Consumers didn't help much, I must say. They kept buying the gas guzzlers as long as they could afford to fill them up. (As an example, with the recent dramatic drops in gas prices, what kinds of vehicles do you think have picked up in sales? According to my son, who is responsible for scheduling all the the North American car and truck assembly plants for Ford, it's back to the big SUV's and pickup trucks.)
But the UAW and the employees are the ones who will have to take the biggest hit if the U.S. auto industry is to survive. But you don't hear them in Washington offering up very much, do you? Oh boy, they're going to give up the "job bank" over a period of time. Do you know what that is? It's a program whereby laid off employees get paid 95% of their hourly rate plus health insurance for as long as they're laid off. They get first crack at any new jobs when they're created. When GM says they're going to shut down 3-4 plants because of bad sales, they don't save much. The hourly workers get to stay home with the kids and still get paid 95% of their pay. It's his kind of stuff that has to go if we're ever going to have an auto industry.
Unfortunately, I don't believe the UAW will ever give this stuff up unless it's under the gavel of a bankruptcy judge. That certainly wouldn't be good for my son and his family. But I don't think it will happen otherwise.
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And that's why we have two types of bankruptcy proceedings - Chapter 7 & 11.
The UAW isn't stupid. The Job Bank may be one of the first items to be suspended in Chapter 11. A smart UAW negotiator would have already worked out a cooperative plan with the Big-3 contingent upon the Big-3 acquiring bailout money.
It's amazing that we have set up via Chapter 11 the best means for a company to stay in business during hard times, yet if the company doesn't want to do an "11," for obvious personal selfish reasons, our elected officials want to ignore the good laws they made and throw uncontrolled money at them. Unbelievable!