I f you look at what happened in the railroad industry in the 80s with downsizing that is what is going on now in the auto factories. It used to be anyone hired before 1981 had a guarenteed job. so the roads tried to “buy out” all the senior people with anywhere from 25 to 120000$ buyouts. now the same thing is going on at GM and Ford. All this while the ceo,s are getting millions of dollars in stock options. go figure.
Now the railroads are hiring 1,000’s of new employees. Without the restructuring the alternative is bankrupcy, foreclosure and liquidation. Then no one has jobs. While a bitter pill to swallow it is better than the alternative. As their share of the domestic market slips year after year it shows the auto industries business model is not sustainable. This will affect the railroads in what is shipped. While it seems unfair that one is paid millions while others lose their jobs the people who own the company (shareholders) feel the end justifies the means.[2c] As always ENJOY
GOD help the working man! or woman
For the USA steel industry GOD is all thats left to help them. The companies they worked for are all but gone.[:(]
Your analogy is wrong.
What’s happening to GM/Ford/Delphi is more akin
to the retrenching of the American Steel industry
in the late 1970s and 80s than to the RR industry.
Dave
Pray harder. [(-D][(-D]
There would be a closer analogy between rail and cars if there were Big Rail like UP, BNSF, CSX, and NS, and then if there would be foreign rail companies, not only exporting their goods to the U.S. but operating here like JNR, Korean Rail, CP Rail and CN . . . never mind!
UMMM last I heard, Unless I’m Wrong Bill Ford wasn’t getting paid a salary or taking stock options until Ford turns a profit on its north american operations. Not that he needs the money though. You got to remember Ford DID MAKE MONEY last year… They had some of their best sales ever overseas in Europe and Asia. Some of the other auto brands it owns is doing very good. GM on the other hand is expected to declare bankruptcy any moment. It could happen monday it could be next year, then again it might not. But they have nothing left to sell. They sold EMD, Hughes Electronics, GMAC is now in the pike to be sold - well most of the controling interst in it. If either one of these companies can get it through their thick heads is that americans want to buy their Cars and Trucks, but not if they cant at least get a good gas mileage out of it and dont say they dont know how. They have known how since the late 70’s and early 80’s on how to get good gas mileage. ITs not until the people of this country get it through their thick heads that we all need to stick together… Pick a week where we dont go to work, stop all the trucks and trains and park them, declare a national strike and see how fast fuel comes down and how many things would change overnight.
DSKTC I guess my point in comparing railroads to the auto industry was they both resorted to lump sum buyouts.
At least Honda and Toyota are building engine and auto manufacturing plants here in the US.
China’s Wong Yong Yang Steel Group sure didn’t.
Also, I believe that GM held 12% of Suzuki’s stock, and Suzuki just bought that back. It sure seems that GM is posturing itself for something down the road.
The number of people in the US earning their living manufacturing cars and trucks is about the same as it was ten years ago. While GM, Ford and Chrysler were laying off in the East North Central States Toyota, Honda, BMW etc. were hiring in the Southeasten States.
I have to admit one thing …
The first time I see a car in my neighbor’s driveway that was made in China, by a Chinese company … I just don’t know … [V][}:)][:-,]
Although Chinese cars are still a far way from American/European/OtherAsian quality, a man on the west coast almost opened a couple of dealerships, but financing fell through.
But, Chinese cars are a’coming.
If MIT and GM got behind MIT’s new practical Lithium battery, and GM reentered the electric car business and increased the percentage of hybrids, they could easily make a comeback. But they seem too dedicated to finding solutions to problems that make matters worse, like biofuels, which if implemented broadly enough would bring on global hunger. (Agricultural products are indeed a renewal resource, but the land where they are grown is NOT!) One big advantage of a Lihtium battery is quick recharge time, ten minutes as against several hours, and other is much lighter weight.
But pointing out the invasion of foreign manufacuters is right.
But didn’t this start in the passenger rail car industry? Other than Amtrak and heritage equipment, when was the last time you rode a light rail car, subway car, or commuter car made in the USA?
sw…Saw on a report this morning a deal was in the works for GM to sell controlling interest in GMAC for a reported 8 BILLION so that would go a long way of helping on the 10.6 Billion of loss in 2005. But then what…And Ford continues to loose market share too so they are not in much better shape. Believe the figure for Ford is now down to 17%. They have put so much reliance on trucks and the Explorier has dropped 50% since 2000 and only one new passenger car developed in time period…Just now {this year have they provided some new pass. cars}. Most on same platform and it was foreign.
You mean GM and Ford are in trouble. Overall, the auto industry is doing fine. All the above steps are rather orthodox steps that companies in dire trouble take to recover. When you’ve got excess capacity, as GM and Ford clearly do, employees represent a huge part of the cost. Those options are worth something only if the company gets turned-around, a big “if”. Otherwise, they’re just pieces of paper. Downsizing in the railroad industry didn’t just begin in the '80s. One could argue that it began with the onset of the Great Depression, when there were about 2.5 million workers, to 2004, when there were 251,000, with a brief upsurge because of WWII. Alas, a “guaranteed” job is of another time and place. Only in the last couple of years, as the railroads have become more competitive and the economy has picked up, has there been clear hiring trend.
You can’t lump Ford and GM together in this discussion. Ford is a much better diversified company than GM with an overall lower cost structure. Ford’s North American Operations is just one piece of the Ford Motor Company. In fact, even while losing money it’s N.A. operations, Ford Motor is expected to make over $7 BILLION in pre-tax PROFIT in FY 2006. And there are signs that even the N.A. operations are turning around with the new line up of cars. GM, on the other hand seems to be running with out a driver.
Ford will survive. GM probably wont.
I’m not an isolationist, but it looks to me we’re letting ourselves become dependent in yet another industry. The foreign carmakers are building cars here, but the earnings are going overseas. I want to buy from GM or Ford, but their offerings don’t measure up in what I’m interested in. I hope Bill Ford’s vision yields some real advancement. I think back to GM’s pavilion at the New York World’s Fair in the 60’s. Then I wonder is this the way the Pennsy blew it?
Oh, they’ll both survive in name, but they’ll be much different. Ford isn’t in as bad a state as GM, yet, but just as with GM, Ford is going to have to address their underlying cost-structure problems. If GM declares bankruptcy and reorganizes, GM will have a much more competitive cost structure. The betting in the business press seems to be that Ford would soon follow GM. This is very similar to the airline industry, where high-cost airlines that declare bankruptcy to wipe-out legacy costs put pressure on the other high-cost airlines to do the same.
Ford is showing some technical innovation. From what I remember , Ford’s hybrid SUV can be operated in pure electric mode (for a limited time, of course).
Hybrid units are gaining strength from most manufactures now…Still a very small percentage but gaining. I cite Toyota, Honda, Ford and GM and now lexus too. From this point forward it seems it {hybrids}, wil start gaining at a faster pace. Many more choices and more capable units. But still costly.