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GM parts supplier Delphi plans to axe 24,000 jobs: reduce hourly wage from $27 to $9
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| ogvh5150 |
No word on whether union dues will see a similar cut. After all If my pay were to drop around 66% shouldn't my union dues drop equally?
| quote: | Former General Motors parts unit Delphi, which is in bankruptcy protection, has said that it will close all its US plants unless trade unions agree to wage cuts to rescue America's largest auto parts-maker.
Delphi CEO Steve Miller, who received a signing-on hello bonus of $3.7 million last summer, said that he hasn't received union counteroffers to his proposal, which includes reducing wage levels from an average $27 per hour to as low as $9 and slashing up to 24,000 jobs over a three-year period. Motor union UAW President Ron Gettelfinger called Delphi's offer an "insult."
"We are going to try and save as many jobs as we can, but at the current wage rates, we would have to close down all of our US plants," Miller said. Delphi will pay an average US wage of $26.97 an hour in 2005.
Delphi was spun off from General Motors in 1999 and a strike could cripple both the parts maker and its largest customer GM.
Last Wednesday, loss-making General Motors' stock fell to a 14-year low - it fell 6 percent to $21.29, its lowest level since 1991 and embattled chief executive Rick Wagoner was compelled to issue a statement to employees that the company has "absolutely no plan, strategy or intention" to file for bankruptcy. Despite the firmness of the intentions, there is a Custer's Last Stand feeling about the strugggle of the onetime icon of industrial America, to pull the fat from the fire.
Delphi filed for court protection in October after Miller failed to win concessions from unions and financial help from former parent General Motors. Miller has said he will ask the bankruptcy court to let the company impose terms if unions don't agree to pay and benefit reductions by December 16th.
The UAW, along with Delphi's other trade unions, said its primary focus in coming weeks will be to expose and challenge generous executive compensation packages Delphi is proposing for senior management.
Delphi plans to pay almost $90 million in bonuses for 486 top managers as a fair reward if the company emerges from bankruptcy. It also said a recently improved severance program is necessary to keep 21 key officers from leaving.
Last week, the unions lambasted the pay packages as a clear example of "corporate greed" and a sign of Delphi's insensitivity to the plight of the factory workers who keep the company running.
GM parts supplier Delphi plans to axe 24,000 jobs: reduce hourly wage from $27 to $9; pay managers bonuses worth $90m
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It's no wonder the Teamsters left the AFL-CIO.
Article below is from 2003 so there is no excuse that no one saw it coming:
| quote: | Troy-based parts maker Delphi Corp. has based its "total cost strategy" on the use of a ready labor pool, low-cost suppliers and existing engineering and manufacturing plants outside the United States, a top Delphi executive said during a presentation Tuesday at the auto industry's annual Management Briefing Seminars in Traverse City.
"As a result, Delphi is locating operations in low-cost countries that make sense, like Mexico, China, India, Eastern Europe and Russia," said José Maria Alapont, Delphi's president of international operations and vice president of sales and marketing.
"These are countries where we can build and sell as well as build and export," he said.
Suppliers take jobs overseas
Auto plants in cheap-labor countries save cash, but threaten factory expansion in U.S. |
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| NeoPhono |
The days of graduating from high school and finding a job that pays $20 bucks an hour or more are over in this country. If the only skill you can list on a resume is "high school diploma," then guess what, somone in another country will do it for a lot cheaper than you will.
Stay in school, kids. |
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| Groundhog Boy |
| quote: | Originally posted by NeoPhono
The days of graduating from high school and finding a job that pays $20 bucks an hour or more are over in this country. If the only skill you can list on a resume is "high school diploma," then guess what, somone in another country will do it for a lot cheaper than you will.
Stay in school, kids. |
IMO, people who just have graduated from high school shouldn't be making $20 an hour in most parts of this country anyways. A lot of college grads don't even make that much. That's a starting salary of $41,600 which is far more money than any kid working in a auto industry area needs to be making if he doesn't have a family to support. You can almost live like a king in some Midwestern towns for that much at 18-22.
This auto industry issue is pretty big, though and it's kind of ridiculous how much they expect people to cut their wages in order to make the company survive(especially in light of the management's packages). That CEO's sign on bonus is only the equivalent of 75 people's $40K per year salaries. I'd almost say if I were in the Union's shoes that if they want to cut salaries that much, I say to let the ing company crumble. |
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| JM |
| quote: | Originally posted by Groundhog Boy
IMO, people who just have graduated from high school shouldn't be making $20 an hour in most parts of this country anyways. A lot of college grads don't even make that much. That's a starting salary of $41,600 |
damn straight. most of the business students at my university that graduated with me didn't start out making 41K their first year. I didnt.
Make that college degree worth something dammit!
>JM< |
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| ogvh5150 |
| quote: | Originally posted by Groundhog Boy
I'd almost say if I were in the Union's shoes that if they want to cut salaries that much, I say to let the ing company crumble. |
So if you were in the unions shoes, you wouldn't mind losing millions in union dues a year? |
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| Groundhog Boy |
| quote: | Originally posted by ogvh5150
So if you were in the unions shoes, you wouldn't mind losing millions in union dues a year? |
If the other alternative is taking a 67% paycut and making all of your union members aware that you're willing to sell them down the river in pursuit of a buck, then yes. The UAW consists of a lot of workers than just the ones at Delphi, so a showing of that much weakness would cause a major fallout amongst the members who elect the guys who earn their income from those dues.
Realistically, it'll have to come down to a compromise, where the unskilled workers (like the guy who mows the lawn who's making $25/hour) will take a paycut, just not at the level they're talking about. It'll either be that or they'll strike, severely slowing down production for Delphi, therefore affecting GM, which I don't really see happening. |
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| ogvh5150 |
Elaborate a bit more.
But to go off track a bit:
The way I see it is that this tactic by Delphi is just a reason for them to outsource or farm out their production to another country. It doesn't look like it but I believe it's headed that way. It's only a matter of time and union concessions.
ADDITION:
| quote: | Troy-based parts maker Delphi Corp. has based its "total cost strategy" on the use of a ready labor pool, low-cost suppliers and existing engineering and manufacturing plants outside the United States, a top Delphi executive said during a presentation Tuesday at the auto industry's annual Management Briefing Seminars in Traverse City.
"As a result, Delphi is locating operations in low-cost countries that make sense, like Mexico, China, India, Eastern Europe and Russia," said José Maria Alapont, Delphi's president of international operations and vice president of sales and marketing.
"These are countries where we can build and sell as well as build and export," he said.
Suppliers take jobs overseas
Auto plants in cheap-labor countries save cash, but threaten factory expansion in U.S. (Article is from 2003 so there is no excuse that no one saw it coming) |
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| gabba420 |
| quote: | Originally posted by ogvh5150
Elaborate a bit more.
But to go off track a bit:
The way I see it is that this tactic by Delphi is just a reason for them to outsource or farm out their production to another country. It doesn't look like it but I believe it's headed that way. It's only a matter of time and union concessions.
ADDITION: |
Word...When I read of this article that was the first thing that came to my mind. I mean how is GM to compete with Asian market cars when there Asian labor is so much cheaper cost than Americans wages. In five years China is coming out with there new cars taht will be imported in the US. Those cars are suppose to be cheaper and way more efficient. Americans seem to be buying these cars more than GM cars. So GM has to start to adapt to the competition. |
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| ogvh5150 |
| They don't have to adapt that much being that they have been a global company since around World War 1. |
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