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30,000 people are to be laid off by Ford in the near future as Ford fights for its existence. There are many factors in this, foremost of which is the diminution of market share that Ford has suffered at the hands of foreign competition, but there are others.
1) Design- the vehicles they are producing are clearly not what people want.
2) Reputation- they have a bad reputation in the core categories, with the exception of trucks and SUVs. This reputation is partially because they are still not made as well as foreign vehicles, partially because they made absolute garbage a long time ago and people remember that, and partially because rebates have cheapened their products as people now will not pay sticker because they expect the discount.
3) Scandals- the Firestone/Explorer thing really hurt them, as did the recall on their halo car, the GT, and the numerous recalls of the Focus, their popular compact. It goes toward reputation, but it really stands alone as indicators of both poor reputation and design.
However, they are also burdened with massive pay, healthcare, and pension problems. The average UAW worker makes well over $20 per hour with benefits, and what has Ford gotten for this outlay? Reduction in market share on a grand scale, shoddy construction, and burdensome obligations that threaten to drive Ford out of business.
Has the UAW basically negotiated Ford out of business? I think they may have. Ford, of course, is complicit in the deal because negotiations go both ways, but check this out: all UAW workers laid off this year get full base pay and benefits until September of next year. Those that don't continue to make up to 5 times the current minimum wage plus benefits, which is a deal that a lot of people would kill for, except that unions are a bitch to get into. It is estimated that Ford will have to pay $475 million this year to do the layoffs. And, of course, they still have to negotiate with the UAW, who will likely do what the airline unions did and fight tooth and nail for what many would consider to be outrageous salaries.
But, again, what does Ford have to show for some of the highest salaries in the business? Poor reputation, inferior workmanship, defects galore, generally poor ratings from the media, and years and years of moribund sales.
Does the UAW bear any responsibility for this situation? Note that the same argument can be made for GM as well. How much of it is corporate, and how much is the union?
1) Design- the vehicles they are producing are clearly not what people want.
2) Reputation- they have a bad reputation in the core categories, with the exception of trucks and SUVs. This reputation is partially because they are still not made as well as foreign vehicles, partially because they made absolute garbage a long time ago and people remember that, and partially because rebates have cheapened their products as people now will not pay sticker because they expect the discount.
3) Scandals- the Firestone/Explorer thing really hurt them, as did the recall on their halo car, the GT, and the numerous recalls of the Focus, their popular compact. It goes toward reputation, but it really stands alone as indicators of both poor reputation and design.
However, they are also burdened with massive pay, healthcare, and pension problems. The average UAW worker makes well over $20 per hour with benefits, and what has Ford gotten for this outlay? Reduction in market share on a grand scale, shoddy construction, and burdensome obligations that threaten to drive Ford out of business.
Has the UAW basically negotiated Ford out of business? I think they may have. Ford, of course, is complicit in the deal because negotiations go both ways, but check this out: all UAW workers laid off this year get full base pay and benefits until September of next year. Those that don't continue to make up to 5 times the current minimum wage plus benefits, which is a deal that a lot of people would kill for, except that unions are a bitch to get into. It is estimated that Ford will have to pay $475 million this year to do the layoffs. And, of course, they still have to negotiate with the UAW, who will likely do what the airline unions did and fight tooth and nail for what many would consider to be outrageous salaries.
But, again, what does Ford have to show for some of the highest salaries in the business? Poor reputation, inferior workmanship, defects galore, generally poor ratings from the media, and years and years of moribund sales.
Does the UAW bear any responsibility for this situation? Note that the same argument can be made for GM as well. How much of it is corporate, and how much is the union?
