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The Water Cooler
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Time to boycott Goodyear
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<blockquote data-quote="dennishoddy" data-source="post: 3409185" data-attributes="member: 5412"><p>Unions are what caused GM to require government bail out. Unions are what caused a lot of manufacturing including the steel industry to go overseas. </p><p>Early retirement pensions that became underfunded have causes a lot of this. </p><p></p><p>"GM has 2.5 pensioners for every active worker, the story said. Consequently, on top of any discount, each GM car or truck made this year will carry about $1,900 in pension and retiree health care costs, the <em>Post</em> said, citing Stephen Girsky, an industry analyst for Morgan Stanley. That's up from about $1,300 last year.</p><p></p><p>"There are more health care costs in a car than steel," Girsky said.</p><p></p><p>The other Detroit companies also carry "legacy-cost" (pensions and health care expenses) but they're significantly lower — about $1,100 per vehicle for Chrysler unit and about $900 for Ford.</p><p></p><p>Foreign-owned carmakers have much less of a legacy cost burden. They haven't been in business long enough in the U.S. to have many retirees. Nissan's oldest plant in the United States in Smyrna, Tennessee has about 700 people on its pension rolls, giving them a decided advantage in the marketplace and a significant edge in profitability. In 2002, Nissan's profit per vehicle was $2,069, while GM eked out $701 per car, according to Harbour & Associates."</p></blockquote><p></p>
[QUOTE="dennishoddy, post: 3409185, member: 5412"] Unions are what caused GM to require government bail out. Unions are what caused a lot of manufacturing including the steel industry to go overseas. Early retirement pensions that became underfunded have causes a lot of this. "GM has 2.5 pensioners for every active worker, the story said. Consequently, on top of any discount, each GM car or truck made this year will carry about $1,900 in pension and retiree health care costs, the [I]Post[/I] said, citing Stephen Girsky, an industry analyst for Morgan Stanley. That's up from about $1,300 last year. "There are more health care costs in a car than steel," Girsky said. The other Detroit companies also carry "legacy-cost" (pensions and health care expenses) but they're significantly lower — about $1,100 per vehicle for Chrysler unit and about $900 for Ford. Foreign-owned carmakers have much less of a legacy cost burden. They haven't been in business long enough in the U.S. to have many retirees. Nissan's oldest plant in the United States in Smyrna, Tennessee has about 700 people on its pension rolls, giving them a decided advantage in the marketplace and a significant edge in profitability. In 2002, Nissan's profit per vehicle was $2,069, while GM eked out $701 per car, according to Harbour & Associates." [/QUOTE]
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