Car sales continue to hurt, workers continue to suffer

[pdboilermaker]

http://www.freep.com/article/20081215/BUSINESS01/81215046
Toyota halts completion of Mississippi Prius plant

By BRENT SNAVLEY
FREE PRESS BUSINESS WRITER
Toyota said it plans to delay production at its Blue Springs, Miss., plant where it is planning to build the Toyota Prius "due to the steep decline in the market."
Toyota said it plans to finish construction of the plant since it is about 90% complete but said it plans to put the installation of equipment on hold.
"This likely means that start of production will be delayed," Toyota said in a statement. "Due to the uncertainty of the market, it is impossible to say at this time when production will begin."
Initially, Toyota planned to build its Highlander SUV at the Mississippi plant. But in July, as gas and oil prices hit historical highs, Toyota announced major changes to its North American production plans.
Toyota said it would assemble the Highlander in Princeton, Ind. It announced that it would assemble the Prius, the world’s best-selling hybrid vehicle, in the United States for the first time beginning in 2010. In November, sales of the Prius dropped 48.3% in the United States.
"We appreciate the patience and understanding the people of Mississippi have shown in recognizing this is an extraordinary and unprecedented time for the auto industry," Toyota said in its statement. "We are committed to completing the Mississippi plant when market conditions allow."

[Old Panda]

Well, ya gotta hand it to Toyota to being honest and up-front with the people of Mississippi. Being fair with the local workforce and fair to the company itself.

If this had been GM, they would have went ahead hired hundreds of workers and began the production of SUV's, built up a 6 month supply and then laid everyone off and closed the factory, stating that the workers were no longer making a profitable vehicle. All equipment would be shipped to Venezuela or India to make bullet-proof limos for Government Officials.

Meanwhile, the workers are all left holding their di.......

[driven2succeed]

Chrysler announced tonight that they are shuttering all of the plants on 12/19 until 1/19. Ouch. I am ever so thankful to have a reliable vehicle that is fuel efficient. I feel for those working in the industry, but their unreasonable contract has contributed to this situation. Toyotas (some made in Indiana) are made for half the hourly wage that the big three are spending. Those UAW member who are actually working aren't making twice as much, but when you factor in benefits and salary being paid to those not actually working anymore...

[vwW12]

Originally Posted by driven2succeed

Those UAW member who are actually working aren't making twice as much, but when you factor in benefits and salary being paid to those not actually working anymore...

Actually, this is a myth.

Because of ERISA, a 1974 law President Gerald Ford signed, companies that operate defined benefit pension plans have to have them fully funded at all times. I quote:

«Under ERISA, minimum funding requirements were established for defined benefit plans. By their nature, defined contribution plans are always fully funded, even if the employee has not yet become vested in the employer contributions»

Let me state it another way: by law, GM and Chrysler already have had to set apart the retired workers pension programs and health care back when those workers were working and before they retired. The $70/hr is to pay for current employee salaries and future benefits to current employees; i.e. current employees are truly making $70/hr in cash and benefits combined.

Like Neil Conan said on NPR's Talk of the Nation last week: it was a PR disaster when word got out of the $70-dollars-plus compensation that GM and Chrysler pay.

So the spinning has been furious to confuse people and mislead them into believing that the $70 figure somehow includes people who retired long ago. Not so.

[shadowchameleon]

How will this shutdown effect Chrylser dealership parts departments?

[wildman]

Speaking of Chrysler and their dealerships, has anybody heard anything from Mensa? I just wondered how he was weathering this storm.

[shadowchameleon]

As far as I can tell Mensa is doing well. I see him everyday at work.

[Old Panda]

The Chrysler 'shutdown' will only effect the assembly of vehicles, nothing else. They usually shutdown around Christmas anyway, so all this does is give them an added couple weeks of time off.

All their parts depots are functioning as normal and will remain open as usual.

[shadowchameleon]

So chrysler is still manufacturing body panels and components?

[pdboilermaker]

Those our service order parts. Those kind of parts are built through out the year in quantities that are huge. I am sure the warhouses have ample supplies for at least 5 years of most parts.

In our case, our customer Subaru used to do a 1 time buy and they would buy at one time all of the service parts that they estimated that they would need to last them 15 years. Those parts that we built 15 years ago are sitting somewher in a warehouse in Cherry Hill New Jersey.

All of the OEMS do it basically the same way

PS - dont forget, that most parts of the car are made by the OEMs suppliers, not the OEM with a few exceptions like transmissions and engines, but many of the parts used to assemble the transmissions and engines DO come from suppliers.