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GM will be bankrupted once more, and for mostly the same reasons. Poor quality products due to poor quality parts sourced from the cheapest game in town... And usually the lowest paying to boot.
If you were to ask me, the entire domestic automotive industry requires an overhaul. It's just gotten too far out of hand to manage. One major cause was the miscalculation that automation would have. For one thing, many suppliers cannot afford high end automation. So, they are often dependent on workers who require more experience, more tools, and some brains. They don't work for peanuts though, and suppliers are finding out the hard way. So, they hire whoever shows up for the wage. Usually the equivalent of laborers with no expertise. It's nothing short of semi organized chaos, on a good day anyways.
Automakers are going back to their roots and repeating the same process that led them to bankruptcy. Shop on price first, and quality somewhere ambiguously near by, with no clear frame of reference. Even if quality was a concern, the supply chain is so polluted with halfwit suppliers who draw from the bottom 20th percentile of the workforce... I'm surprised they have managed their supply chain as well as they have.
I think the best thing that could happen is if the automakers themselves made more of their own widgets inhouse, thereby creating jobs that pay a dignified wage. Ground level workers will (hopefully) take greater pride in the products they make when they belong to a union, and are paid a slightly better wage. I think the impact would lead to a net reduction in total jobs, but an uptick in the quality of jobs. We really don't need anymore low wage 10-12 dollar an hour jobs an America. We need adult level opportunities.
Hopefully, when GM goes bankrupt next time around, us tax payers won't be coerced into subsidizing this disaster of a domestic industry. Out with the old, in with whoever can manufacture cars competently, and profitably. If it ain't an American company, so be it. I don't believe in American exceptionalism. I do believe whoever is calling the shots at these large corps need to get their heads out of their rears.
Their net income last year at 3.949 billion should have been better, as it is just about 2.5% of revenue.
Even in good times, auto suppliers fare worse than their customers.
For this one Bob, you must look beyond the numbers... At least, those numbers. GM needs to invest in process engineering consultants to send to many of their struggling suppliers. The problem is, it's hard to tell who is qualified for such a task. I've heard far too many horror stories about companies spending six figures for a consultant who does virtually nothing, or makes things worse.
The auto suppliers who are mostly in trouble are the ones caught between a financial pinch...
They desperately need to upgrade and modernize their shops/plants, but they also need skilled and specialized workers to keep their current, still functional machinery running. Anytime a company requires something specialized, you're talking $$$. If you aren't willing to pay the money, you'll end up with unqualified workers who can cost a company far more than they can make or save. So yes, it's a tug of war between saving for future investment, and spending money for qualified workers.
Also consider the generational bind. I don't have the numbers, but manufactures are going to lose a huge segment of their skilled workforce in the coming decade. Employers here have already feeling it, so I suspect Metro Detroit will be/is ground zero. There will be plenty of work for automakers, but they won't be able to survive with the small margins, and the high cost of training 10-12 dollar an hour "potential". They certainly won't be purchasing tools with that kind of paycheck.
With all of these challenges placed in perspective, I really don't see how a dysfunctional company like GM can survive. Nor do I feel they deserve to move forward. America has to learn from their many selfish mistakes.
The $10-12 job is definitely a problem with suppliers. A lot of these people can't afford the cars they build parts for. I worked for a temp service at KIA making $12 an hour, and they were paying team leaders at the connecting suppliers plant the same money. The temps there were making $8-$9 an hour.
Found out that the temps are now waiting two years to get hired at KIA.
Those auto suppliers don't provide parts to just GM or "domestic" manufacturers. They supply parts to the Japanese and European automakers. The Japanese and European automakers assemble most of the vehicles domestically.
My family made the mistake of buying two cars in the late 90's a Saturn and a Pontiac. The Saturn didn't make it to 100K miles as it began developing serious issues at 60 and was turning into a money pit. The Pontiac Looks like it won't make it to 40k as we've already spent >$2k trying to deal with the defective antitheft system they built in (Passlock) has no working horn, and many of the plastic and other parts are falling apart. They just make bad cars. Needless to say I drive a Honda.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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While the Tahoe seemed a popular vehicle used by law enforcement for a while, especially feds, I am seeing more and more Explorers now even for local police departments and state patrol.
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