Snippets

There’s absolutely stuff-all to write about today from a purely Saab perspective. Maybe I’m getting bloggers-block?

These are the thoughts on my mind for this morning:

1. If this story is representative of all Delphi and GM employees that may be going out on strike in the coming months then I’m pretty well staggered. If you can’t be bothered clicking on the link, the story is about a Delphi employee, a high-school dropout that’s been working there for around 30 years and now earns about $90,000 US dollars a year.

Let me say that again – US$90,000 a year working in an assembly plant.

Sitting in a beige leather recliner in the family room of his modest home, Michael Balls knows he has had it pretty good since he dropped out of Saginaw High School in the mid-1970s. He now makes $31.35 an hour, plus overtime.

Without a diploma, he got a job at the plant when he was 19, then took two years of classes to become a skilled tradesman. He graduated from high school in 1988.

During good years, with 10 to 12 hours of overtime per week, Balls earns about $90,000 at the plant, which makes front-wheel-drive steering columns and other products.

“I thought I was set for life,” he says.

Now, at 48, he’s not quite old enough to retire and fearful that Delphi will cut his wages if he stays on. He’s especially worried that Delphi won’t be able to meet its pension obligations.

“There definitely ain’t a pot of gold at the end of the rainbow,” Balls says.

Buddy, you’ve been raiding the pot of gold for 30 years.

I’m a professionally qualified worker in a public financial arena and I earn a decent five-figure sum in Aussie dollars. This guy’s earning six-figures in Aussie dollars for playing with a big Meccano set.

Forgive me if my sympathometer is sitting low on the register. The quicker these labour contracts get sorted out and ditched, the better. “Balls to the wall!” I say…….(couldn’t resist)

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2. Out of the assembly plants and into the office…..

There’s been nothing but the sounds of crickets chirping, tumbleweeds rolling and dead air in my post box since sending away the “Tell GM About It” comments. They were sent to Jay Spenchian, Bob Lutz, Carl-Peter Forster and Jan-Ake Jonsson. So far – no response.

Hopefully that’s due to them all being heads down, bum up and working harder than a one-legged man in a butt-kicking competition. A little advice – Saab needs the following:

AWD in the 9-3 and/or 9-5 range
An entry model (9-2) that kicks everybody’s backside
A small SUV along the 9-3x lines
A dedicated, well-salaried blogger (Hey, I’ll do it for less than one of your Meccano-boys)

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On a personal note, the Viggen finally got it’s local registration today. Due to the previous write-off status, it had to have a bunch of inspections for structural integrity, identity etc. All these have now been completed and I’ve finally got some local tags sitting on my desk, waiting to be attached to the car.

How dumb is this? I’d love to get personalised tags for the car, but the state charges you $100 PER ANNUM for the privelege!! No wonder you hardly ever see them around here.

As far as I know, Tasmania’s the only state in Australia that has this annual fee. I think there could be some activism coming in the near future….

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19 Comments

  1. I won’t even comment on Mr. Balls’ outrageous salary. It makes me too upset. However, I believe that it’s just about the same in most of the US (of course it differs from state to state) when it comes to “vanity plates”. You will be paying a fee every year to keep “SWD ROX” or what have you over your bumpers!

  2. I guess this (good) story falls under the Snippets category:

    http://waw.wardsauto.com/ar/auto_saab_auto_steering/index.htm

    Saab Auto Steering Into Black

    Ward’s Auto World, Nov 1, 2005
    For what is probably only the second time since General Motors Corp. acquired Saab Automobile, the Swedish brand will be profitable this year, says Jay G. Spenchian, general manager of Saab Cars U.S.A. Inc.

    Spenchian also says he has been assured by Fritz Henderson, president-GM Europe, that Saab is an important part of the company, and its product portfolio will be expanded, not terminated, as some reports suggest.

    The Saab chief says worldwide sales will total 140,000 units this year, including 42,000 in the U.S. That represents a 12% increase, including fleet sales, over 2004.

    Meanwhile, Spenchian says he did not learn about GM’s divestiture of its Fuji Heavy Industries Ltd. stock until shortly before the news was made public Oct. 5.

    The move killed plans for the 7-passenger 9-6X cross/utility vehicle, based on the Subaru B9 Tribeca.

    He expresses confidence the brand will market new models in the future, with previews set to begin at the Detroit and Los Angeles auto shows in January.

    A Saab concept, to be unveiled in Geneva in March, will signal the auto maker’s future design direction, he says.

  3. Mr. Ball’s salary isn’t that outrageous at all when you think about it. First do the math. His base salary at $31.35/hr X 40/week X 52 weeks/year = $65,208. Second, realize that this base salary comes after 30 years of hard work and raises — he hasn’t been making this amount for three decades. Additionally, although it makes no mention in the article, typically in any job, promotions involve some form of additional management responsibilities, even if only over a few other employees on the shop floor. It’s highly unlikely that his job description is the same today as it was 30 years ago.

    And do not forget that Federal and State taxes take away a significant part of the base salary, which is why many people work overtime at work that is, oftentimes, physically and mentally draining and/or damaging (how much money would somone have to pay you to do the same repetitive task year in and year out, even when you get old and injuries become more common).

    For Mr. Ball to make $90,000 means he has to make about $25,000 in overtime — a time investment that given the physical nature of his work seems rather unsustainable over many years. Finally, overtime is actually favored by American business as a cost-saving alternative to hiring more workers.

    On a personal note, despite the fact that I have a PhD in physics and reside somewhat in the upper income brackets, I do not begrudge Mr. Ball or others like him his good salary. They do hard work that is often unappreciated. I wish them all the best.

    Finally, I should mention that a significant source of GM’s woes comes from the large-numbers of GM retirees. What has happened to GM will happen eventually to Toyota and all the other manufacturers when they mature. As per ABC news here in the U.S., Toyota is — astonishingly — only paying benefits to 1000 or so workers, whereas for G.M the number is in the tens or hundreds of thousands. And my understanding is that the Japanese government subsidizes their auto industry in various ways — through healthcare benefits and such.

  4. I grew up in a GM town and could keep you up all night with stories of the nepotism and outrageous pay that goes on at UAW run factories and they are run by the unions. The fat contracts started back in the 1950’s when the American auto industry ruled the world as, in the mid 50’s every other car made on Earth was made by GM, once you add Ford and Chrysler into the mix the dominance was not just astounding but also unsustainable. Unfortunately no one thought the gravy train would ever end and even years after the “Big Three” had been humbled by makers from Europe and Asia the fat contracts kept on coming.

    It’s now to the point where we have uneducated, unskilled workers making more than lawyers and doctors. There was an article a few months ago in the Detroit Free Press about a fork lift driver making well over $110,000 US a year. The part that is bad is that these uneducated workers are easily lead to believe, by the union – and their insular subculture – that not only are the worth 100 grand a year but that car makers are taking advantage of them.

    It’s a legacy mindset from the beginning of the last century that leads to an adversarial relationship between works and management that leaves the Big Three at a competitive disadvantage to “foreign” car makers with plants in the US.

    If the bankruptcy of Delphi doesn’t wake everyone up to how dangerous the UAW contracts are then GM will eventually have to declare bankruptcy as well. Hell, GM already has more ex-workers on the retirement roll than they actually have working.

  5. And lets not forget the many ‘workers’ sitting around as part of the job bank scheme. Even if they’re only earning the base salary, they’re likely to be pulling in $40 – $50 – $60K per year for doing two-fifths of nothing!

    Rough maths translates Mr Balls’ $90K US income to around $120,000 Australian. I know partners in accounting firms that earn less.

    And if a worker such as Mr Balls chooses overtime, then that’s his choice. I’m not going to feel sorry for the sacrifice he’s making. It’s his choice. He’s still earning at base more than what I make in a year as a professional in the financial field.

    All I’m saying is that GM’s contracts don’t seem to represent a fair day’s pay for a fair day’s work. They’re living off the fat of prosperity won decades ago and Mr Balls seems more saddened by the fact that the fat is going, then what may be the prospect of the entire kitty being eaten up due to a lack of willingness to negotiate and ensure a future.

    They’ll get what they deserve. If they’re greedy about it, they’ll get nothing. If they’re smart, they’ll get a working future.

  6. In Sweden, a personalised tag cost SKR 6.000 and is then valid for ten years. That’s about AUD 1.012 today, so I think you got of cheap… 😉 The money we pay goes to traffic saftey research.

    On a side note. This was on the news wire late moday in Europe.

    Frankfurter Allgemeine Zeitung (German newspaper) claims that Saab will introduce three new models in Europe in the coming years. They are quoting an “anonymous GM executive”.

    The 9-7 will be sold in Europe. Then they are developing a a new 9-4 (smaller SUV/cross over), and then there is a new 9-2 (abour the size of VW GOlf nad Opel Astra). No words on Sonett.

    But then again, it’s a German paper… 🙂

  7. Paul,

    Is that $480 fee your rego or is that on top of your rego? The $100 per annum here is on top of our normal rego and 3rd party, which totals around $460 a year.

  8. Sorry, but I don’t agree with most of you.

    I don’t fault the worker at all. Who can blame them for maximizing their pay?

    I blame GM’s management. They are the ones who are negotiating the contracts and writing the checks. The legacy costs are hurting GM’s bottom-line, but who ultimately controls the company?

  9. I’m 30 years old with a University engineering degree and I make $42500 a year which is a slightly over average salary and on that i pay 33% taxes. Sweden is not a fun country to live in….

  10. Dan,

    There is nothing wrong with wanting better pay. The point is that these unskilled workers are getting paid way more than they are worth, or that the market can bear and that we simply have no sympathy for them. They have had a good run but now it’s over. Nothing more, nothing less.

    As for your assertion that the contracts are solely the responsibility of management I can only be left to assume you have never heard of what unions call a “strike”. In a strike the workers stop working see, and the companies stop making products and start losing money. It is through the use of these “strikes” that unions are able to get such wonderful contracts.

    Every three years the UAW chooses one of the Big Three to strike in order to garner ever more concessions from the automakers and that contract is then used for the other two. Back in the 90’s it was GM’s turn, management held out for months until they ran out of trucks. Go to the local Chevy dealer for a pickup? Sorry all out. GM finally had to cave after losing millions. This you somehow are able to see fit to say is only management’s fault, as if the union had nothing to do with it.

  11. amon_amarth,

    I take exception with your statement, “Second, realize that this base salary comes after 30 years of hard work and raises — he hasn’t been making this amount for three decades.”

    I used to be a member of a union (as usual, it was REQUIRED to take the job). I was being paid an outragous salary which had been “negotiated” by the union. The way it works is that everyone with my job title makes the same salary no matter what. It’s not like in the private sector where the harder you work and the better job you do you can earn a merit increase. The union regularly “negotiates” new ever-higher-paying salaries for their employees (factoring in higher cost-of living and inflation as well). Why should I work hard if the guy next to me is sleeping on the job? It’s not like I’ll be rewarded for my hard work…

  12. I grew up and live in metro Detroit and get outraged when people start taking on union wages. First, these guys don’t make $30+/hr unless they’re in a “trade”, which means a much more complicated job than screwing four bolts into every engine that comes down the line (the bolts upon which your life might one day depend). Second, the UAW wages aren’t that tremendous–it’s that others’ wages are that appallingly low. Auto workers in Sweden and Germany have higher annual incomes working far fewer hours. Third, they aren’t living high off the hog like the morons earning 7-8 figures to run GM into the ground, so don’t blame them for GM’s problems. Last, how much would they have to offer you to lift tires all day to put on each car that comes down the line, 40 hrs/wk for the next 30 yrs? Without my education, I’d rather welcome people at Wal-Mart for $7/hr (if they’re up to that) than do that for $20/hr.

    Disclosure: I do not now, nor have I ever worked for GM or any GM affiliate. I did work at Ford Motor Company (in purchasing for 7 yrs, then worldwide marketing for 3), but am gladly no longer working in anything related to the automotive industry. Last week, I bought my third Saab and I don’t want to see it disappear either.

  13. Mort, according to that article, production workers are currently averaging around $27 and hour. These are the ones that are due for the proposed $12 an hour pay rate. Not too bad at all for an assembly worker.

    You live close to where that’s happening, so I repsect your opinion, but I can’t agree with it. This wage isn’t too high? C’mon…

    A similarly skilled tradesman in small business will get what the market will pay for his services. If he’s good at what he does, he’ll get paid well because his services will be in demand. These guys aren’t getting paid a market rate. Their colleagues at non-UAW plants are and they’re scared to death of having to come down to it.

    The other thing about the market – it’s flexible. It moves with supply and demand. The UAW seems to think that it’s market-proof, whereas everybody else knows that GM aren’t. These guys aren’t living on a wage that’s responsive to today’s marketplace. They’re living on a wage won when the big 3 were the only 3 that counted, when times were golden – the road was big and the SUV’s were just as big and the fuel supply seemed endless.

    I agree with you about the management salaries, however. GM’s management are living high on the hog, too. They could take a leaf from Toyota’s management handbook, where the top exec receives around a million per year. It’s a team effort over there and that’s why they’re prospering.

    But please, don’t give me the one about my life depending on a bolt that they have to tighten as a justification for these high wages. They assemble an engineered item and they should be capable of doing that to a standard without demanding exorbitant pay that’s not commensurate with the job. I rely on my outdoor furniture to hold together so that I don’t fall off it and break my back, but how much am I willing to pay for outdoor furniture?

    Again, it comes down to the market. Human resources are frequently any company’s biggest expense. In GM’s case, inflated wages and benefits are crippling the company and are going to have to be adjusted if they’re to avoid bankruptcy.

  14. Paul, I’m blown away. My nephew and my sister both have custom plates in Melbourne and they paid an up-front fee only. No annual fee.

    I admire your dedication!

  15. Isn’t amazing how much us NSWers are getting ripped off. For my plates: SAA899 I pay $100 ontop of rego. When I was looking at plates SAAB99 would of set me back $480! I’m happy with SAA899 as most people can understand.

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