The Detroit Free press ran this article disputing the allegation that unioin wages are out of line for American carmakers.
The UAW is losing its edge in pay compared with non-unionized U.S. assembly plant workers for foreign companies, even as Detroit automakers aim for deeper benefit cuts to trim their losses.
In at least one case last year, workers for a foreign automaker for the first time averaged more in base pay and bonuses than UAW members working for domestic automakers, according to an economist for the Center for Automotive Research and figures supplied to the Free Press by auto companies.
In that instance, Toyota Motor Corp. gave workers at its largest U.S. plant bonuses of $6,000 to $8,000, boosting the average pay at the Georgetown, KY, plant to the equivalent of $30 an hour. That compares with a $27 hourly average for UAW workers, most of whom did not receive profit-sharing checks last year. Toyota would not provide a U.S. average, but said its 7,000-worker Georgetown plant is representative of its U.S. operations.
Honda Motor Co. and Nissan Motor Co. are not far behind Toyota and UAW pay levels. Comparable wages have long been one way foreign companies fight off UAW organizing efforts.
But Toyota workers' pay topping that of UAW members comes as the union faces contract negotiations this year with struggling Detroit companies that will seek billions in concessions, partly because they face higher costs for retiree health care and pensions than their foreign-owned competitors.
Who's to blame?
UAW Region 8 Director Gary Casteel said if Toyota workers were paid more than union workers last year, the blame lies with Detroit's auto executives. The companies have lost market share because of past mistakes, which have translated into fewer bonuses for workers, said Casteel, who is on the union's executive board.
"Our profit-sharing formula, I know, is better than theirs -- if our vehicles are selling," Casteel said.
Ron Lare, a 59-year-old Ford employee on pre-retirement leave, said Toyota workers shouldn't get too excited about their wages because bonuses fluctuate. The only thing consistent, Lare said, is union protection.
"The floor beneath their feet is basically what the UAW has won," said Lare of Detroit, who has worked at Ford for 28 1/2 years. "If the UAW gets beaten down, their pay is going to come down. You let there be a real recession in the auto industry -- that bonus won't be there for Toyota, either."
Union perks vs. nonunion perks
The pay comparisons reflect the relative profitability of the foreign and domestic companies more than shortcomings of the UAW. But the situation chips at the argument that workers united in solidarity can get better wages, benefits and job security -- especially as the UAW shrinks and growing foreign companies continue to ward off organizing efforts.
"How do you convince someone you're better off with the protection of a union when they're making more money than the union employee?" asked Alfred McLean, a 66-year-old hourly UAW member at General Motors Corp.'s Warren Tech Center. He has 28 years of experience.
Workers for foreign automakers don't pay union dues, but they do share the costs of insurance and retirement plans. UAW-represented autoworkers get health insurance and a full pension after 30 years -- valuable perks they will fight to keep during contract negotiations this year.
But even accounting for Toyota employees' health care spending -- $700 per year on average, according to the company -- the Georgetown workers still made more in 2006.
General Motors Corp., which lost $10.6 billion in 2005 and didn't issue profit-sharing checks last year, paid its production workers an average of $27 an hour, GM spokesman Daniel Flores said. That would be a base of about $54,000 a year, based on a 2,000-hour work year. The $30 average at Toyota's Georgetown plant, which includes a bonus, equals $60,000 a year.
Ford Motor Co. and Chrysler Group representatives said GM's base pay figures are similar to theirs. Only Chrysler, which had a 2005 profit, paid a bonus last year. The $650 bonus was not enough to surpass Toyota's pay.
For years consumers have been asking for fuel efficient vehicles. What has been the response from US carmakers? Build more trucks and SUVs because the profit margin is larger. Unfortunately management failed to provide American consumers with the high mileage vehicles they wanted- which is why Toyota and Honda sold out in the US.
But American carmakers did build them for Europe.
Here are some links to wonderful, fuel efficient cars GM is building in Europe. These would've sold in the US.
http://wheels.blogs.nytimes.
http://blog.wired.com/cars/
So enough of the BS about union wages destroying the car industry.
I sail bail out the carmakers - only if their entire management teams step down, or agree to work for free until profitability is restored.
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