CUT PAY, KICK 'EM WHEN THEY'RE DOWNUAW workers are not to blame for OE bailout : by Tim Sramcik

Editor's column: CUT PAY, KICK 'EM WHEN THEY'RE DOWN, UAW workers are not to blame for OE bailout
Publish date: Feb 1, 2009
By: Tim Sramcik
Source: Automotive Body Repair News

http://abrn.search-autoparts.com/abrn/Collision+Repair/Editors-column-CUT-PAY-KICK-EM-WHEN-THEYRE-DOWN/ArticleStandard/Article/detail/578993

The next time you get a chance, do yourself and your industry a big favor. Walk out onto your shop floor and kick your best tech as hard as you can in the backside. Make it hurt. It's important you show as much disrespect as possible to the person who shows up every day, puts in overtime, goes to training and devotes a good part of his or her life to you.

Next, cut his big, fat salary. After all, his high wages are at the core of your business problems just as they're the source of rising repair costs and the rising number of totals.

SOUND PRETTY STUPID? IT IS. But I've heard similar foolish statements made about UAW workers during debates over the auto bailout. Specifically about the purported $73/hour UAW members are supposed to be making "standing around turning a wrench." That wage is supposed to be the main source of Detroit's problems, unless you're the kind of person who believes in looking at fact.

FACT 1: The $73/hour stuff is nonsense. Actual current hourly wages for GM workers average between $14 and $28/hour. Benefits are another $10/hour. The $73/hour figure represents those numbers combined with benefits and the costs of pensions and health care for retired workers (people who have long since left the factory floor).

FACT 2: Labor contributes only 10 percent to the price of a car. In case you haven't noticed, American cars cost significantly less than their import rivals, usually several thousand dollars less for a comparable model. When was the last time you heard someone say, "I really wanted a Chevy or Chrysler over my Honda, but they're way too expensive?"

During the Congressional bailout debate, the people actively pushing the $73/hour myth were senators from Southern states that are home to factories run by import manufacturers – not exactly the kind of people who would be rooting for Detroit to succeed.

Who makes key decisions that ultimately decide whether a company survives. It's the executives, the same folks who were content to keep building gas guzzling big trucks and SUVs while practically ceding the core midsize and small vehicle markets to import brands. These are the same people who have had 30 years to win back the confidence of American consumers who believe, often rightly so, that import models offer far more in the way of quality and reliability. Oh, and if you're looking for workers whose wages actually work out to $73/hour (over $150,000 annually), that and far more is paid to a lot of people in offices who make the decisions that have kept Detroit struggling.

I believe the duty of the press is to bring the truth to light. Unfortunately, truth doesn't often translate into ratings, which explains why these facts often don't make their way onto cable news outlets. I also think it's important, especially in these difficult economic times, for members of the automotive industry not to turn upon one another. The American automotive market supports over 3 million jobs. These are your vendors, neighbors, friends and maybe even relatives. In these tough economic times, in an economy where every job is tied to another, every job matters.

Should one of the Big Three automakers fail, the consequences would be dire. Repairers already are reporting having to wait weeks for some parts due to Detroit's problems. Expect more of that should an automaker go under. Expect, too, to see vehicle values depreciate even more, which means more totals. Figure in the fact that fewer American jobs mean fewer customers to pay for your repairs.

Detroit needs to find solutions to turn its fortunes, and ours, around. That means addressing its real ills honestly, which shouldn't include squeezing autoworkers or making ridiculous claims about their compensation. We would do well to learn the same lesson.

Contact info:
tsramcik@advanstar.com

(440) 891-2743
About the Author

Tim Sramcik
Editor-in-Chief
tsramcik@advanstar.com

Tim began writing for ABRN nearly ten years ago, although he joined the staff full time in January 2008 as Editor-In-Chief. He has produced numerous news, technical and feature articles covering virtually every aspect of the collision repair market. In 2004 the American Society of Business Publication Editors recognized his work with two awards. Tim also has written extensively for Motor Age and Aftermarket Business. Articles by Tim Sramcik