Saturday, November 15, 2008

Take My GM Stock, Please

While I hate to take the loss, I'm coming to the conclusion that GM might need to to fail. The right thing might be for me, and all of us, to watch the company go down, as it has seemed determined to do for many years now. The financial planning side of me, of course, would love to see the government continue to support, and even bailout, this company. That's the part that has been buying the stock and waiting patiently for the Chevy Volt to hit the stores and revitalize the industry in a way the Prius only dreams of doing. Alas, that's the fool in me. There are too many other variables, from pension and health care costs, to poor administration and design systems, as well as an inclination in buyers that this just isn't a good product. I've never owned anything but an American car (and that doesn't include Toyotas made in Texas or Missouri), and I've always lamented the choices by so many Americans to do the opposite. Yet, I understand.

When I learn that the average UAW worker is earning $70 an hour, compared with$40 for auto workers at other manufacturers, I truly begin to doubt it's possible to fix this problem. If the government decided to bail this company out, a complete redesign of their labor contract would have to be part of the deal. That's a shame, considering the expectations of people who might have bought a house or enrolled their kid in college expecting a higher wage. But that's the reality. It's truly too bad, considering the news of health costs for the company, that GM didn't lead the charge fifteen years ago to back the Clinton health care plan which would have alleviated much of their problems. Now, many companies are getting on board, and it might be too late for these dinosaurs of American industry. Even the UAW tried to get the company to back a national pension and health care system fifty years ago, and when the company balked (out of absurd fears of "socialism"), the workers had no choice but to push for the best deals they could get. I don't blame them for inadvertently shooting themselves in the foot.

Then again, even if the company had been smart enough to foresee its health care and pension problems, the management would have still driven the company to its knees by making Tahoes and F150s when the world wanted Camrys and Priuses. So, I'll swallow the medicine and take the loss. It's the right thing to do. How sad.

1 comment:

Mrs. C said...

Honda parts were made in Indiana, too. :]

One thing that bothers me about "American made" items is that the manufacturer doesn't stand behind the product like it used to. Service isn't the same. I don't mind paying, even a LOT extra, if I know the money goes into my neighbours' pockets AND that the company will do the right thing if I were to get a lemon.

Years and years ago, we got a Maytag washer. It was so bad that even with the additional ($$$$) warranty we burned through all the warranty would cover, which is $1,200 parts and labour was "free." Then they were just DONE with us even though the washer acted up within four months of purchase. They refused to trade for a new comparable washer. I even offered to pay the difference.

With treatment like that, I'm not feeling loyal any more. I can go buy Japanese or Indonesian crap if that's the way it's gonna be. Then when it busts, I'm not out so much and can buy another crummy product to replace the first one.

I agree... it's sad.