Interesting Word from Insider?

[kenrexford]

Not sure if this is true or not, but it is interesting. I heard from a GM guy these two "facts," if they are true:

 

1. The heads of the big three went to Washington in private plains because Congress, years ago, passed some law that they are not allowed to fly commercial because of some national security issue, considering their defense contracts. Of course, they probably could drive, but apparently commercial flight was out.

 

2. All new hires at GM are paid on scale with Toyota/Honda. It is the older contractual obligations to the retirees that is the problem. In other words, the "big three" have actually worked with the UAW to change the status quo people.

 

Not sure what this all means. It just sounds like perhaps more political BS to make us take sides without giving the full picture, if all true.

[mike777]

They are many old legacy issues.

 

 

They have too many plants. They have numerous contracts with cities to pay off bonds even if they close the plants. In simple terms in many cases it is illegal to close the plant.

 

GM uses about 9000 dealers to sell the same number of cars that Toyota does with 1500. Again GM has agreements with cities that make it illegal to close these dealers.

 

In simple terms many UAW contracts basically say a worker can do one type of job, not many types of jobs. They need more flexibility on this issue but the contracts make it illegal.

 

Look at another thread, almost no one posted buying a new, GM, F, or C car. I know I never bought a new one and the last used one I owned was over 25 years ago.

 

Congress has basically made it illegal to import GM or F or C cars and sell them for a profit in the USA. Look at Gerben's thread about Opel. Think about this, how many companies in the USA could survive without being allowed to sell stuff made in China, Korea, etc.

 

Filing for Chapter 11 would solve many of these old legacy issues. This means the current owners would lose all of their money and the current creditors would become the new owners and be forced to write off much of the debt perhaps as much as 50-75%.

 

I still have seen no plan presented to return these companies to a sustainable profit making business. If the goal is to give money to the workers, send checks to them directly not the current owners of these companies.