New vs. Old--Costs [Archive] - CamaroZ28.Com Message Board

guionM

04-27-2003, 08:33 PM

Originally posted by ol'93formula
I don't think that a Vette is good example to use when comparing the cost of cars today vs yesterday. The Corvette has gone upmarket.

A better comparison would be a Grand Prix. Here is a copy of a motor trend test from 1965. This car had a price as tested of $4868 with a base of $3500.

http://www.pontiacserver.com/mtgp5.html

So if a $5300 1965 Corvette = about $30,992 today.

Then a $4868 GP should cost about $28,466 today. This looks about right.

Originally posted by centric
Are new cars really more affordable? Take a look at this thread:

http://forums.corvetteforum.com/zerothread?id=546283

Highlights:

1. A $5300 1965 Corvette = about $30,992 today.

2. 1967 Corvette with total cost of $4686 taking 9 months of starting engineer's take-home wage to purchase versus new Corvette taking 22 months of starting engineer's take-home to purchase.

There is a reason that we have leases and 72-month financing today, when we didn't have them back then: cars are overpriced.

So nearly 40 years of progress = more expensive cars that offer less colors and less choice. I find it very sad that today's robotized factories, using parts outsourced to who knows how many low-wage countries, cannot compete with hand labor and vertical integration that's 40 years out of date.

ol'93formula is dead on. BUT....Also consider what you get todaystandard that you didn't before:

*Air Conditioning *Power windows, doorlocks,& mirrors, *Warrantys that last alot longer than 3 months, *Engines that typically last well over 100,000 miles, not 30,000, *Onboard computers that have nearly 4 times the computing power of all the ones used for a Apollo moon mission...COMBINED, *Anti lock brakes, *Air bags, *Longer lasting equptment & sub-systems, * longer (and cheaper) service intervals (remember replacing plugs, condensers, & distributor caps every few thousand miles?), *Electronic stereo systems w/ CD players & 8 system speakers, *Energy adsorbing bumpers, *Body structure engineered to adsorb impact instead of forcing you through the front end in head-on collisions, *alarms & anti theft ignition systems, *346 cibic inch engines that get more ACTUAL horsepower and at least 3 times the fuel mileage of 454 cubic inch "special production" high performance engines of the past, *The complete elimination of 99.99% of carbon monoxide, and over 90% of most all other emmisions over the past 30 years, let alone 50!

Throw in far better build quality (easy to forget that cars today are built bank vault tight, right down to Daewoos) and the fact that car makers have to throw in billions of dollars on regulations and increased development costs for a far more demanding consumer.

When all of this is taken into consideration, AND the fact that cars (taking inflation and average wages into account) is still running about the same as an average person's salary, it's a nothing short of a miracle cars don't cost a whole lot more!!

Few examples of salaries over the years:
http://www.mde.k12.ms.us/Account/2003Report/CTNoSa03.pdf
http://www.iaap-hq.org/ResearchTrends/salaries.htm
http://nces.ed.gov/pubs2002/digest2001/tables/dt081.asp

Jason E

04-27-2003, 08:42 PM

I agree, for what you get sometimes, cars are WAY overpriced, compared to what you used to get. BUT...cars have made such huge advancements since then, in terms of durability. Sure, some people are crazy enough to do 72 month financing, but at least at the end of the 6 years there is a car left! My dad's '69 Camaro was a rustbucket by 1975 that barely ran a year later, with 100k miles on it. Conversely, my '95 Grand Am I sold last summer with 121k on it was like brand new in and out, despite never being inside, hardly washed until I got the car with 109k, and having oil changes done every 6-7k during that same time frame. Show me a '60s car that could do that...AND have not a speck of rust on it!

guess who

04-28-2003, 12:37 AM

People dont look at what the dollar is worth these days.All most think is "HOLY F-IN' POOP $35,000!!!"

If thats the case why arent you thinking of what a pop used to cost.5 cents!It is plain fact that the cost of the american dollar has gone upUP UP! since 53 or earlier.So has everything else at the same time,Its all about what guionM said.

It's life learn to live with it I say.

kizz

04-28-2003, 03:28 PM

You guys know the good ol' phrase "America's love affair with the automobile" , right?

Well if you ask me, today's lower bang-for-buck factor and reduction in choices and individuality are no accident; They are a direct result of the automakers being pushed against the wall by a government smackdown designed to gradually get us accustomed to drones, i.e. electric cars and mass-transit cars. To get us to fall out of love with the automobile in the long-term. I'm not saying today's cars are unsafe or stripped down, because they are just the opposite. But look at their appearance. You just can't fall in love with a car's soul anymore. They don't make them like they used to. Hell, I'm only 27, and I already miss the "old days".

Maybe the ousting of Saddam Hussein and the subsequently cheaper crude oil availability will have some impact down the line, but it's a lost cause. This cookie-cutter thing has been in the works for double-digit years already. Today's cynicism-generating car environment is a carefully orchestrated thing, no accident.

gt

Eric Bryant

04-28-2003, 06:12 PM

Originally posted by WERM
BTW: What kind of Engineer are you talking about? If I use $46,000 as the cost of a corvette, that works out to be about $25,000 a year.

Note that they said "take home pay", which would be roughly $25K with a $40K base salary. Sounds 'bout right for a starting engineer :)

Yes, cars have more content nowadays, but so does everything else that we buy.

centric

04-28-2003, 06:27 PM

So most of you don't have a problem with telling your grandchildren, "Wow, it's great that your new Corvette takes 4 years of take-home income to buy, and is only available in two colors?" Because if you extrapolate the trend, that's where we're going.

But hey, it will last 250,000 miles, and have 3mm panel gaps, so that's OK.

Seriously, though, longer lifespan and better fit and finish should be cheap with the automation and better machining/production technology we have these days. More computing power? We're talking pennies.

What I'd like to know is how today's cars, with hundreds or thousands of fewer, cheaper parts (go ahead, compare a glove box door on a 1966 and 2000 Corvette and tell me that the cast metal/stamped aluminum/painted/riveted/with chrome badge one on the 1966 is a cheaper part compared with the molded foam 2000), and better factory automation, can cost more and offer less selection?

And I'd argue the Grand Prix is not a good example, either. It's gone downmarket from a V8 RWD stepping-stone to Cadillac to a generic V-6 front driver. The Corvette has maintained its relative position fairly well.

WERM

04-28-2003, 06:47 PM

Originally posted by centric

What I'd like to know is how today's cars, with hundreds or thousands of fewer, cheaper parts (go ahead, compare a glove box door on a 1966 and 2000 Corvette and tell me that the cast metal/stamped aluminum/painted/riveted/with chrome badge one on the 1966 is a cheaper part compared with the molded foam 2000), and better factory automation, can cost more and offer less selection?

Lol, I bet there are more components to the wire harness of the 2005 Corvette Dash than the ENTIRE 1967 dashboard assembly. Now, go around and open the hood of that corvette, and tell me the engine compartment has "far fewer parts." Then take a look underneath and compare the number of parts. If you've got a lot of time, open up and compare the trannys and pull of the wheels and compare the suspensions and brakes. Go back to the interior and pull off a door panel, compare the number of parts behind the door.

While you do all of this, keep in mind that every one of those parts has to have a mold, stamping press or die tooled up to produce it and that someone or something has to physically install it. Also take note of things like door panels that are one piece yet made of different materials. This is done for quality and is not always cheaper than bolting two parts together - but it doesn't rattle.

All these extra parts exist because:

a) people want them
b) the government wants them

Sure, they are expensive, but cars are the bargain of the century. Considering the number of parts and the cost of the car, it's absolutely mind boggling... You can buy a new KIA for the cost of a nice bedroom suite or a year at a decent college!!

Z28Wilson

04-28-2003, 07:09 PM

What was the one mind-boggling statistic that I heard a while back...if you tried to piece together a $20,000 car part by part, purchasing each part individually, you'd end up spending something like $80,000+.

Considering the fact that as with any good or service in the world you can't sell a car for more than people are willing to spend, and the auto industry is coming off of obscene record profit amounts in the last few years and buying booms that they couldn't have imagined 10 years ago, I'd say cars are probably priced right where they should be.

centric

04-28-2003, 08:25 PM

I've been arms deep in my C5. I've had my 66 off the frame. I understand tooling (I spent five years as a EE). I'm still not convinced, sorry.

It sounds like we'll have to agree to disagree.

I am very concerned with the automakers' new stance that $35-40K is going to be point of entry for V8 performance, and I'm concerned about the shrinking number of choices that we have with respect to exterior and interior colors and options. To me, it seems like these results are inconsistent with truly superior processes . . . and true progress.

Z28Wilson

04-28-2003, 08:59 PM

Originally posted by centric
I am very concerned with the automakers' new stance that $35-40K is going to be point of entry for V8 performance

On that point I don't think you'll get much of an argument from anyone here. The next Camaro has GOT to find a way to offer a world-class chassis, decent interior materials and fit/finish, while coming in at what a 2002 Z28 was, adjusted for inflation.

Eric Bryant

04-28-2003, 09:20 PM

Originally posted by WERM
Lol, I bet there are more components to the wire harness of the 2005 Corvette Dash than the ENTIRE 1967 dashboard assembly.

You'd be surprised at how simple harness assemblies are getting, due to the increased use of serial buses (such as J1850, CAN, LIN, etc.). Sure, there's increased engineering cost up front, but the piece price drops significant. Sure, this hurts a bit more on lower-end vehicles like the Vette, but the engineering investment can be spread over multiple platforms to a certain extent.

Parts-department prices say nothing about the cost of manufacturing the vehicle. The markup ranges from 400% to 900% (our contracts usually require that we sell service parts to the OEMs at the regular negotiated production pricing). If you do some digging into, say, Toyota vs. Lexus pricing, you'll found two parts sold with the exact same part number, in slightly different packaging, for a 2x difference in cost. Interesting stuff, to say the least :)

I was thinking more about this topic while changing oil on the Accord, and I think there's some non-intuitive reasons for new car pricing. I think that the Big Three pay too much for labor, and more than they did 30 years ago. Health care and pension costs are higher now. Mismanagement of the supply chain has probably raised cost (keep in mind that most part design was done in-house 30 years ago - added additional layers of value-add mark-up may have increased costs at a great rate than productivity has increased). Halo cars like the Vette, trucks, and SUVs are carrying higher markups, as generic passenger cars from the Big Three aren't making much money (if any at all).

I think that Toyota and Honda sell their "generic" vehicles at very competitive prices and make a lot more profit by avoiding some of these pitfalls. If there was more competition, I don't think that Honda could get away with 8% profit margins while GM struggles with a 1/3 of that if they didn't have significant advantages.

I'm sure there's others that I haven't thought of now, but will later :)

Doug Harden

04-28-2003, 09:22 PM

....perspective.

I just turned 46 years old......and when I see a car that costs $35k.....I still think Corvette price......I just do.

My parents bought their home and 5 acres, in 1961 for around $9,000.00.......

My home...which I built 11 years ago and used all my resources as an Architect.....cost me $150k+ on a 1 1/2 acre lot....with a $1k/mo mortgage...

Call me old fashioned, but all the rationalization in the world doesn't help the fact that I wil refuse to pay nearly the same amount per month for a car as I will my home.......all the while knowing the car will depreciate faster than a sinking rock while my home just keeps getting more valuable.

If the entry point for a V8 RWD performance car is in fact approaching the mid to upper $30k's then the Camaro is SCREWED :eek: :alert:

Smells more and more like the death of affordableAmerican muscle cars........sad really..............

The T-bird died again due to it's extremely high price for what will always be a 2nd car.....a big boy's toy............just like the Camaro did.....

guess who

04-28-2003, 09:52 PM

Eric do you happen to know how much autoworkers pay costs the manufacturer per unit?;)

Eric Bryant

04-29-2003, 07:44 AM

Originally posted by guess who
Eric do you happen to know how much autoworkers pay costs the manufacturer per unit?;)

Not exactly, but I've got an idea of what it costs us around here, and as a non-UAW Tier 1 supplier we only get to pay our workers about 40% of what an assembly-line worker at the Big Three makes.

ProudPony

04-29-2003, 10:28 AM

OK - not typical for me to be close-minded, but I am going to be this time.

When you machine a stamping die to make a steel fender, hood, or trunk lid, the cost of the steel for the die is fixed - regardless of the car the fender is intended to go on. The machining time is roughly the same to machine the shape of the fender, so machining time is a wash between models too. Installing the die in a press, loading rolls of sheet steel, etc all take the same basic amount of time as well. Stamping presses can produce large or small fenders at the same cycle rate - 1 cycle = 1 fender - and the presses run at @20 strokes/minute. Actual tooling cost and cost/part across the models varies only a small bit at the OEM level. Pricing (especially outside) is cut-throat it is so tight. It really doesn't matter if the company is tooling up for a Cavi fender, GTO fender, or a C/K1500 fender, the tooling costs are almost identical. The cost-savings come in making as many parts as possible ON THAT TOOL AFTER IT'S BUILT. Distributing the entire $250k price of the stamping die across 400K units adds only (250,000/400,000 =)62.5 cents to the cost of a Cavi fender, but $250k across 40k units adds (250,000/40,000 =)6.25 dollars to the cost of a GTO fender. And only (250,000/900,000 =) 27.7 cents for the C/K fender!:shock:
My point is, tooling cost is not so important as many beleive. It is volume dependent, and that's why raiding a "corporate parts bin" is so economically fruitful these days.

Next issue is this labor thing. I don't hold anything against a hard-working UAW person - but when I, as an engineer with 8 years of college education and a 4-year apprenticeship as a tool and die maker, saving $millions for my company each year, scarcely make more than a high-school graduate working in a paint booth - there's something wrong. Again, I'm not anti-union or pro-union, but look at what has happened to unionized companies in the last decade... and not just auto workers either - look at the airline industry for example. That guaranteed high-paid job they fought so hard for has resulted in them "pricing themselves" right out of work. It is a no-brainer IMO.

40 years ago, there were people all over the line moving parts by hand, doing machining manually, painting manually, fitting body panels by hand and eye, and so on. Now, there are robots that do most of this work, thereby reducing the actual man-hours per car at assembly. The reduction is staggering in some modern plants like Saturn's, Honda's, and Mazda's. Humans hardly touch the cars themselves now until near the end of the process in finish and trim or QC areas. And robots are ALWAYS at work on time, never call in sick, always do the job exactly the same, and result in better overall quality than humans do. And I promise, robots are FAR cheaper than humans in a given position - even $300k Fanuc robot (we use GE-Fanuc units in our company, so I know their cost/capability better) cells can pay for themselves in less than 2 years when compared against 3 low-cost employees (1 each on 3 shifts/day) costing the company $70k each per year in salary, benefits, 401K match, insurance, day care, flex accounts, etc. That's 3 people*$70k/year*2 years = $420K for 2 years service against a $300K robot that will consistently outperform the people (for more than 2 years I might add).
Point here --> The human labor hours in todays typical car line is drastically less than it was 40 years ago, yet the labor cost/vehicle is actually more. That should say something about high-cost labor, no?

So here's a question for you to ponder...
What is SO different between totally (from the ground up) manufacturing a Kia for $9k, a Cavi for $15K, a Focus for $20k, A Mustang for $27k, and a GTO for $35K? Does one model have fewer wheels? less seats? more steering wheels/columns? three times as much steel or glass? :p
If we knew the truth, options aside, they all probably differ less than 20% in their actual, basic cost-to-produce, and most of that is in differences like leather v. cloth, sound deadening and insulation levels, and engine/drivetrain components. Yet one costs the buyer over 3 times more than the other... it's called "status", desireability, and marketing. It's like the difference in making a Bic ballpoint pen or a PaperMate deluxe pen - they are less than $.01 difference in ctp, but one is sold in boxes of 12 for $1.99, and the other is sold individually for $1.99. Go Figure...:rolleyes:

At this point, I must add my opinion about the cost of todays cars...
It's too damn high!!!
The honest truth is that carmakers don't set MSRP based on what the car cost to build, they set it based on what the market will bear. Technologies (like my robot example above) have made the cars better AND cheaper - BOTH. Anybody who beleives otherwise is kidding themselves. I make my living designing the machinery and equipment that does EXACTLY THIS KIND OF THING, and I can tell you first hand, my management will NOT approve any request from me for $4million to put in an automated manufacturing cell unless I can PROVE in cold hard figures that they have a 95%+ chance of seeing a 25% ROI-short term for the project. That is, they are going to get $125 in value for every $100 they spend in the next few years. That savings can come in labor cost, throughput, reduced operating expense(i.e. electricity, compressed air, LP gas, etc), reduced scrap, whatever. I'm telling you guys, this IS my job, and it's nothing new to industry. The kicker is, I may get a 32% ROI on my end of the product, and my counterpart in raw materials may get a 27% ROI on a project he's doing too - and we both are working on projects that affect the SAME END PRODUCT!!! That means a cumulative savings of 59% on ONE PRODUCT!!! On one "Micro-Edge" SIMM memory card socket, I was on the product development team and watched our cost-to-produce (all inclusive) go from $1.55 each to $.32 each between '95 and '98 - that's 79% in 3 years. It happens.

When you get a minimum of 25% yeild (actually our minimum here in my company now) on the project, and inflation is (aggresively) 3%, you are beating the HELL out of inflation on cost savings, so I don't buy into the "equal dollar ratio - corrected with inflation" between 1963 and 2003 earned dollars. There are too many variables in the real world that have profound effects on the current buying-value of a dollar to use such rudimentary scales for comparison. If I can replace a metal glove box door that cost $3 with a plastic molded one that cost $1.50 - both in todays dollars - why can't I expect to pass some of that savings on to the customer?!?! Better materials and processes DO NOT mean "more cost" by default. That is a farce portrayed by marketing people to falsely justify huge markups. Remeber this, the best accountants and statisticians can make the numbers reflect whatever they want them to if creative enough. I prefer NOT to exclude factors like material costs, processing costs, distribution, transportation costs, process improvemts, and many others when/if I evaluate a car from 1963 to a 2003 model - there's simply more to it than salary and monetary inflation. Any of you want me to justify your raise for this year based solely on one single day's work you did, or would you rather I take in all the factors from last year?

Which leads me to my last point in this rant-gone-awry...
MARKUPS - aka, margins, profit margin, profit, cleared $, black numbers, and "cha-ching".
When Ford is clearing $20,000 on EACH Excursion - DAMMIT, there's something WRONG! $10-16k for each Explorer sold, $7-11K for each Escape... am I the only one with a problem here?
I don't know GM's margin on their Tahoe, Suburban, C/K trucks, but I am CERTAIN they are in line with what Ford sees on their models. This again, shows that they are pricing what the market will pay, not relative to what their cost-to-produce is. And to think that cars such as the Sunfire, Cavi, Focus, and Mustang are not profitable is insane. The Mustang ALONE pulled Ford out of the fire back in the mid-80's because they were selling like hotcakes, very profitable (like $2.5-4.5k margin each back then), and required no advertising to sell. Margins are everything to a company.

One problem is that the manufacturer's are loading all the advertising, promo, exhibit, shows, and development costs FOR THE WHOLE COMPANY onto select car lines, making them bear the cost load and yeild tax advantages (through losses), while the trucks and SUV's reap the enhanced higher margins. It's an accounting game.
Example - (I'll pick on Ford here) Ford runs an ad, basically for the Explorer and throws in a shot of the Taurus too. They charge the cost of producing the ad, distribution, and airtime against the Taurus alone - since it is the lower-cost, less-profitable unit. The Explorer gets most of the benefit from the ad, and the Taurus pays the bill. All we hear then is how the Taurus is not as profitable...:rolleyes: or how the Cavi is costing GM $3k each to move with incentives...:irk:

I've ranted long enough for one post. If you guys have any questions or issue with what I have said, I welcome the responses. I feel I can back-up everything I said with actual data, from my job or other related documents. The other thing that gets me is, it's not just cars, it's EVERYTHING. From CD's to furniture to bubble gum to medical bills, we are really paying too much for what we get these days with only the rare exception. Just look at CEO bonuses and Director's stock options that are handed out these days if you don't beleive me... even in this slow-to-dead economy. :rolleyes:

Proud:mad:

centric

04-29-2003, 02:57 PM

ProudPony: I'm interested in you have any data or anecdotal evidence that suggests new cars are made with cheaper components, in general, than was common in the past? Things like glass taillights and cast taillight frames, cast glovebox doors get me thinking that we've been shortchanged.

I'm sorry, but the system seems to be broken. It also seems that if enough people complained about it (rather than parroting and supporting the automakers' pricing stance), we could help do something about it.

WERM

04-29-2003, 06:50 PM

So you save $1.50 making a plastic glovebox instead of a metal one, but now you have to add flocking on the inside and a dampener to keep the door from slamming down....but you've also added things like 6 airbags, power seats, power windows, power locks, keyless entry, anti-lock brakes, independent suspension systems, cd changers, air conditioners, automatic climate control systems, fuel injection, computers, moonroofs, alloy wheels, 4 and 5 speed automatic transmissions (up from 3) and 5 and 6 speed manual transmisisons (up from 3 and 4). These things are almost standard on every car nowadays, because people expect them.

Yeah, they've found cheaper ways to make things, but there are so many more things...and robots are great when you are making things like little electronic boxes and running a molding shop - but they don't work nearly as well when you are handling bigger things or assembling them - because you'd need a lot of big robots.

Ken S

04-29-2003, 07:27 PM

Originally posted by ProudPony
The honest truth is that carmakers don't set MSRP based on what the car cost to build, they set it based on what the market will bear.

I've ranted long enough for one post. If you guys have any questions or issue with what I have said, I welcome the responses. I feel I can back-up everything I said with actual data, from my job or other related documents. The other thing that gets me is, it's not just cars, it's EVERYTHING. From CD's to furniture to bubble gum to medical bills, we are really paying too much for what we get these days with only the rare exception. Just look at CEO bonuses and Director's stock options that are handed out these days if you don't beleive me... even in this slow-to-dead economy. :rolleyes:

Yup.. Just like consumer desktop CPU's.. They all basically come from the same batch.. (Well, the highest rated ones might have to go thru some more testing to make sure they can run that fast) But basically all the other speed varients are the same, except for a small part that locks it into the specified speed.

Why don't they just sell the same 1 CPU with the same high GHz rating at one low price? Cause there is a market for slower CPU's at a lower price, and a markup on higher rated CPU's.

If the figure out how to make em cheaper, it doesn't necessarily make the costs to the consumer lower.. it just gives them the option of making them lower if they have to...

With tech advancements for all products, just because something is better, isn't necessarily pushed to the consumer.. If they can still squeeze money out of the current cow, then they'll continue.

Then there are music CD's... blah..

ProudPony

04-30-2003, 08:47 AM

Originally posted by WERM
So you save $1.50 making a plastic glovebox instead of a metal one, but now you have to add flocking on the inside and a dampener to keep the door from slamming down....but you've also added things like 6 airbags, power seats, power windows, power locks, keyless entry, anti-lock brakes, independent suspension systems, cd changers, air conditioners, automatic climate control systems, fuel injection, computers, moonroofs, alloy wheels, 4 and 5 speed automatic transmissions (up from 3) and 5 and 6 speed manual transmisisons (up from 3 and 4). These things are almost standard on every car nowadays, because people expect them.

Yeah, they've found cheaper ways to make things, but there are so many more things...and robots are great when you are making things like little electronic boxes and running a molding shop - but they don't work nearly as well when you are handling bigger things or assembling them - because you'd need a lot of big robots.
As far as robots go, we are using them to handle everything from glass bottles that weigh almost nothing, to chemical containers/mixers, to 15lb bobbins of glass yarn, to handling 120lb raw reinforcement fiber glass packages, to actually toting full pallets of product (1200lbs or more) through the plant. The size is irrelevant because the size and speed (and cost) of the robot are included in the ROI calculations, so if the return is still 25% or greater on the investment - it's usually approved. Fact is, they are better than any human in cases where decision-making can be removed from the process.

WERM, I feel like we're kinda "buds" on this board since we share a lot of common views, and you typically present your case with great support, reasoning, or fact. This may be the first time we've ever been so far apart on our positions about a subject - kinda neat, huh? ;)

I would like to ask you ONE QUESTION...
A Ford Excursion can come from the factory today with ...
"6 airbags, power seats, power windows, power locks, keyless entry, anti-lock brakes, independent suspension systems, cd changers, air conditioners, automatic climate control systems, fuel injection, computers, moonroofs, alloy wheels, 4 and 5 speed automatic transmissions (up from 3) and 5 and 6 speed manual transmisisons (up from 3 and 4)" as you said, plus DVD player, entertainment center, dual stereos, dual A/C, full leather, HD suspension, 14k-lb towing package, auxilliary power outlets, full carpet, 3rd row seat, 17" alloy wheels, a diesel or V10 engine, lighted running boards, signaling side mirrors, lighted sun visors, GPS/nav system, self diagnostic center, console with temp/compass/garage opener built in, and oodles more junk I can't even list right now.
And it will set you back nearly $50k.
And Ford will CLEAR $20K on it, after all the dealers' cuts, transportation charges, labor costs, pension surcharges, material costs, assembly costs, design costs, engineering charges, advertising, and overhead. YES - that's right - $20,000 PER VEHICLE in pre-tax profits. Read THIS ARTICLE (http://houston.bizjournals.com/louisville/stories/1999/01/11/story1.html) and look at the very last line in it.

So here's my question...
How can you see Ford clearing that much money on ONE vehicle, and not think the consumer is being gouged?

I don't expect a vehicle of that magnitude for $9-grand, but the honest truth is - that's not too far below what it ACTUALLY costs Ford to make it - literal cost. The rest of the cost is non-value-added to the unit. How did $750 in freight charges add value to that truck? How does $1800 towards the Pension Plan put value in that truck? How does $1500 in advertising charges put value in that truck? How does $4250 in Dealer incentive put value in that truck? How does Ford's $20,000 margin (beyond all the previous charges) put value in that truck? :irk:
THEY DON'T. This is my point.

I think the QUALITY of todays vehicles is better than ever before. The inherent VALUE of the vehicle (it's ability to do what I need, last for years, and give trouble-free service) is astounding. And if the truth were known, the vehicles made today are very cost-effective to manufacture. Problem is, we don't get the opportunity to benefit from that cost-effective manufacturing process, because...
a)the pipeline between manufacturer and us is filled with middlemen who take their slice of the pie,
b)the manufacturer has been forced to tack-on charges to the actual, mechanical, deliverable, useable product such as advertising, pension, insurance, Union fees, and other non-value-added costs, and
c)the manufacturers set prices based on what the market will bear, not what it can afford to sell the car for and make a fair and reasonable profit.

My Opinion - this is exactly why the import vehicles are gaining an ever-increasing share of the domestic market. They are willing to be a little "less-greedy" and settle for a fair and reasonable profit instead of getting all they can get out of us. Earning $10/car on 100 cars is better than $1000/car on one car, because it helps you distribute the tooling costs over 100 units intstead of only one. The total sales profit to the company is still $1000, but it keeps people working and keeps buyers happy. In another thread, I mentioned my high school buddy just bought a Toyota Tundra because the Ford and GM dealers wouldn't budge on pricing - they had a fixed price, and you could choose a little cash-back or financing rate. Toyota dropped like $4800 off the price, and still gave him a great finance rate to boot - they got a sale for it too.:(

ProudPony

04-30-2003, 09:28 AM

Originally posted by centric
ProudPony: I'm interested in you have any data or anecdotal evidence that suggests new cars are made with cheaper components, in general, than was common in the past? Things like glass taillights and cast taillight frames, cast glovebox doors get me thinking that we've been shortchanged.

I'm sorry, but the system seems to be broken. It also seems that if enough people complained about it (rather than parroting and supporting the automakers' pricing stance), we could help do something about it.

You have me in a catch-22 here centric.
In a word - YES. I do have some data indicating exact production pricing on OEM equipment that we supply to our customers. The catch-22 is that I will lose my job if I disclose any of it in detail - i.e. specific!:eek: I'd like for that NOT to happen! Being "exact" as in stating the make/model/part no and it's cost will get me into trouble for disclosing confidential information, which violates the confidentiality agreement between us and our customers.

I'll tell you what though, I will see if I can do some research out-of-office and drum up some "old" figures on manufacturing costs between old and new. There may be some analyst's papers or lawsuit disclosures that have actual pricing that has been disclosed under permission. Maybe comparing a '70 price to a '98 price for the same headlamp or something - I don't know. Just give me some time - it might be fun.

Interesting tidbit...
One of my good friends who is in charge of the maintenance shop in our biggest plant has a son that's about 32 now. His son got a job at the new BMW plant in Greenville, SC on the assembly line. His son is able to buy brand new BMW's from the back yard at the plant for cost plus a processing fee. They can even ORDER the options they want on the cars.:p (How cool would it be to assemble your own car, on the line, and get paid to do it! :metal: )
Here's a quote (http://www.invoicedealers.com/Step4Recycler.asp?refid=21901&detid=20003&siteid=&UN=20047210810&SN=20047210810&SE=4%2F30%2F2003+6%3A26%3A24+AM&ra1=&ra2=&ra3=&ra4=&ra5=&ra6=&zip=27055&pa1=Classic&pa2=Wholesale+Classic&subNext=true&make=140&year=2002&model=070&trim=9505&pTarget=) I just rounded-up real quick from Yahoo on a new Z3 vert.
Bud's son bought one for a little over $19,000:alert: My word on it. The pizzer is, he can buy all of them he wants - there's no limit of 1/year or anything like that. They just have to pay for it at delivery - BMW won't finance in-house sales.
Everyone that works there, and all their families now drive Bimmers - wonder why?:shock: I've never seen so many Bimmers as there are in that town.

One of you guys (or me) go try and buy one for that, yet BMW covered ALL THEIR COST selling it to him for that price.:rolleyes:
THIS is why I say the public is being gouged. I have priced some new vehicles (Explorer and Mach 1 :D ) recently with my Ford X-plan benefits, and that saves me a ton over MSRP, but they are still making a killing off me - just imagine how the average buying public is getting used.

ProudPony

04-30-2003, 09:44 AM

Originally posted by Ken S
With tech advancements for all products, just because something is better, isn't necessarily pushed to the consumer.. If they can still squeeze money out of the current cow, then they'll continue.

Then there are music CD's... blah..

Would you be referring to the Price-Fixing Lawsuit recently settled in New York?
ARTICLE in USAToday (http://www.usatoday.com/life/music/news/2002-09-30-cd-settlement_x.htm) which states "the industry kept consumer CD prices artificially high between 1995 and 2000 with a practice known as "minimum-advertised pricing" (MAP)"

"Under MAP, the record companies subsidized ads by retailers in return for agreement by the stores to sell CDs at or above a certain price. "

""This is a landmark settlement to address years of illegal price-fixing," New York Attorney General Eliot Spitzer said in a statement. "

"In settling the lawsuit, Universal BMG and Warner said they simply wanted to avoid court costs and defended the practice. "We believe our policies were pro-competitive and geared toward keeping more retailers, large and small, in business," Universal said in a statement. "

So they conspire to get retailers to keep prices artificially and illegally high, but they feel they are "helping keep retailers in business"... ummm,right. :irk: :mad:

Couldn't POSSIBLY be the same in the auto industry, could it now?!?! :think:

centric

04-30-2003, 10:28 AM

ProudPony: nope, I don't want you to lose your job. Just interested in cost comparisons in general. Because it seems that every time a new car is introduced, there is talk about how much simpler/cheaper it is to build.

The C5 was supposed to have "thousands" less parts than the C4 (probably largely because of its multiplexed wiring harness), and it is probably the only example I can think of where the new car cost less than the old one (in the case of the convertible only.)

I remember a press conference discussing the new Viper about a year before its intro, where Chrysler claimed to have pulled $10K in cost out of the vehicle, and the resulting excitement on the Viper board. There was widespread speculation that the new Viper might come in at $59,900 (the 2002 was $70K-ish). Of course, the 2003 came out at $83K. I know this is a poor example of a handbuilt halo car . . . but come on, guys, if you're gonna brag about cost reductions, don't raise the price!

The BMW example is about a 50% cut off retail price. With no limitations on the number of purchases, this tends to support the idea they're still making money on the product--good money. This also supports the idea that the margins they're running are similar to high-end audio products, which are handbuilt in very limited quantities (not many people are crazy enough to want a $5000 tube amplifier). When I was in that business, I could purchase as much as I wanted on "accomodation," which was 50% off retail. Which was also about the same price that we sold to retailers for, which meant we were still making 50-65% margin on the product, with overhead and fully burdened.

Let's compare the industries: high-end audio is niche, low-production, high-margin. Dealers get 50 points. Automobiles are mass-market, high-production, (theoretically) low-margin. Dealers get 10-25 points.

So how come the end pricing models seem similar? Who is making money hand over fist? Yes, cars ARE overpriced.

91Zman

04-30-2003, 10:36 AM

old cost :thumb: new cost:shock: :Owned:

ProudPony

04-30-2003, 02:54 PM

You wanna know where some of your hard-earned cash goes...
wanna see some of the games that manufacturers and dealers play with YOUR money...
then read the following article VERY carefully...
LINK (http://www.fool.com/Car/CarGlossary/GlossaryPricing.htm#Auto)
Pay attention to "Manufacturer's Cost" -
"We do know that in today's market the sport utility and truck market has several entrants that reportedly make the manufacturers over $10,000 per vehicle! Ford's Lincoln Towne Car, Wixom Assembly Plant at one time made the corporation over $1 million a hour in profits. "

Look at "Customer Incentive, or Rebate" -
"They're generally in the $500 to $2000 range...They're primarily given on slow sellers and often used regionally, where an oversupply condition may exist. "

"Dealer Incentive" -
"...a dealer incentive on the vehicles, sometimes in excess of $6,000. The dealers figure that this incentive is theirs and theirs alone, not to be shared with a consumer; they don't even want you to know about it. "

"Holdback, Giveback, or Dealer Holdback" -
"In essence this creates a multi-invoice price system, in which even the dealer selling just one penny over invoice is in reality making 2 to 5 percent. "

Here's a link to an atricle that has the various holdback rates for automakers worldwide...
Linky (http://www.edmunds.com/advice/incentives/holdback/index.html)
Chevy goes 3% of total MSRP, so does Ford, and Chrysler, and Caddy, and just about ALL OF THEM - HOW BIZZARRE they would have such similar processes right out of the blue-creation, huh?:irk:

centric - I too recall some hype about "streamiling" the Viper assembly process from being so labor intensive and cost-cutting material changes, but you're right - the Viper's price sure ain't fallin' is it!
This Presentation (http://imti21.org/Documents/Roadmaps/MS/MSChap1.pdf) (go down to page 4) is illustrated with charts and graphs at how 3-D modelling alone helped cut design/development costs of the Viper, the Boeing 777, and the U.S. Air Force’s Joint Strike Fighter significantly (by 50% in the case of the JSF!!!)
This Report (http://www.leanpackaging.com/pages/benefits/chrysler.htm) shows how ORBIS corporation's pacakge handling systems saved DCM over $338,000/year on their specialty line where Viper and Prowler were assembled - did those cars see resulting price drops?:no:
Here's a handout (http://www.daimlerchrysler.com/investor/reports/annual02/download/pdf/chrysler_group_026_e.pdf) from DCM Investor Relations stating CLEARLY in the FIRST PARAGRAPH that they exceeded their expected earnings in 2002 due to "lower costs, increased efficiency and higher unit sales." Read on and see how they brag about how "the restructuring measures led to greater cost savings and efficiency improvements than originally targeted, but higher unit sales also played a part (see page 69)."

Anybody see their prices falling to reflect these gains they readily admit they acheived?!?!:no: :irk:

I hope I am reaching some of you out there besides centric and Ken S. This is one of those points I am VERY conscientious about, and I take VERY seriously. This post mostly focuses on the dealer's contribution to our inflated costs (save the DCM stuff). I'll work on the manufacturer's share in it next. And that's a REAL doozy.:rolleyes:

Again, my career has been largely devoted to designing manufacturing systems that make OEM parts, and I get the rashyass when I break my neck to get costs down and see a higher price when I go to the dealer to buy a unit I just worked on...:mad:

newby

04-30-2003, 05:44 PM

Wow, this thread is really informing!!

The sad thing is, there really isn't anything we can do about it, at least that I can see. As long as people keep paying those prices, the automakers will not lower them.

I would bet that hardly anyone, we're talking single-digit percentage, has thought about how much markup there is on their new car, seriously thought about it. I know a lot of people think the new car is expensive, but how many of them go beyond that? Most of them just plunk down their money anyway.

It's really too bad people aren't better informed. If everyone made a big enough stink about, something would have to change.

WERM

04-30-2003, 08:53 PM

Originally posted by ProudPony

WERM, I feel like we're kinda "buds" on this board since we share a lot of common views, and you typically present your case with great support, reasoning, or fact. This may be the first time we've ever been so far apart on our positions about a subject - kinda neat, huh? ;)

Yeah, well... you can't agree on everything. But we do work in the same industry, and the location where I work makes large complex parts that cannot be easily or profitably assembled by robot. So that's one of my reasons for disagreeing...

I would like to ask you ONE QUESTION...
A Ford Excursion can come from the factory today with ...
" edit - lots of crap" as you said, plus i] edit - lots of extra crap on top of the other crap[/i].
And it will set you back nearly $50k.
And Ford will CLEAR $20K on it, after all the dealers' cuts, transportation charges, labor costs, pension surcharges, material costs, assembly costs, design costs, engineering charges, advertising, and overhead. YES - that's right - $20,000 PER VEHICLE in pre-tax profits. Read THIS ARTICLE (http://houston.bizjournals.com/louisville/stories/1999/01/11/story1.html) and look at the very last line in it.

So here's my question...
How can you see Ford clearing that much money on ONE vehicle, and not think the consumer is being gouged?

Well, do I think it's expensive? - absolutely. I wouldn't buy something like that knowing I would be lining someones pockets with $20K. But is it unfair? Not really. If nobody bought them, they'd either lower the price or stop selling them. There are lots of choices out there, and almost everyone buys their cars loaded these days. On the otherhand, they do sell a number of models at a loss - usually economy and enthusiast type cars (which I'd hate to see go).

I don't expect a vehicle of that magnitude for $9-grand, but the honest truth is - that's not too far below what it ACTUALLY costs Ford to make it - literal cost. The rest of the cost is non-value-added to the unit. How did $750 in freight charges add value to that truck? How does $1800 towards the Pension Plan put value in that truck? How does $1500 in advertising charges put value in that truck? How does $4250 in Dealer incentive put value in that truck? How does Ford's $20,000 margin (beyond all the previous charges) put value in that truck? :irk:
THEY DON'T.[/b] This is my point.

Yeah, but how do you get rid of them? Have everyone pick their cars up at the factory? Default on the pensions of their workers? (BTW, companies like BMW that just set up in the states have a new workforce and little pension liability - allowing them to sell their cars cheaper and at increased profits.) What about the advertising? If they didn't advertise - they might not sell nearly as many trucks...

...but the profit margin does put some value in the trucks - because it allows the company to stay in business, supply parts and service and design new trucks.

I don't think it's gouging - market forces would prevent that in absence of a monopoly - but I DO AGREE that I think the end result is an overpriced car, and I'm hugely disapointed that the great american V8 appears to be heading to a future where it's only available to the people who can afford luxury cars or high end sports cars.

centric

04-30-2003, 09:58 PM

What can we do about it?

I’d argue that we’re already doing something about it—discussing it in a public forum that the manufacturers monitor. By rejecting their party line, we’re sending a message. I could make a case for message boards undermining most corporate propaganda and marketing in the next few years, simply due to the way word spreads about good or bad products. Consider the 03 Cobra owner whose car was abused by a tech who posted on a message board, and how quickly that got around.

What else can we do? I wonder if it might not be time to write a book, something along the lines of, Hidden Costs: How Corporate Greed and Stupid Regulations are Destroying Your Quality of Life, which would expose rampant waste and mismanagement, such as described so well by ProudPony. Heck, you could do chapters on the RIAA, health insurance, and half a dozen other places where complexity has resulted in unnecessary consumer burden. Give people ways to fight back and beat the system—in the case of cars, by buying used, complaining vehemently to the automakers’ management, etc. Get enough people involved, and things will change.

Never get published? Put it up on the internet as a free PDF download. Hell, I’ll even volunteer to write it, even though I have a company to run.

Why am I so incensed? Perhaps because of something that ProudPony brought up in another thread: we’re Americans. We should be able to do anything we put our minds to—and do it better than anyone else. We shouldn’t be nay-saying little sheeple who come up with reasons why the automakers can’t make a V8 performance car for under $35K—we should be thinking around corners to come up with a way it can be done for $15K!

Ooh, but that’s the young market! It’s risky! It’s scary!

Bullcrap. Think around corners on that one, too. Don’t focus-group your way into a Scion. Sponsor one of the car racing videogames so you can put "upcoming" cars on it. Judge people’s reactions to them, and monitor what kind of mods they do to them. Take the best of them and put them in production. Done.

Or how about engaging the people you find on all the message boards to participate in the design of a new car? Fifth gen—hint, hint.

Or how about hiring young people to sell cars to other young people. Yes, I know they might only be able to do it after school, but they will be much more convincing than a 45-year-old ex-copier salesperson with a pinky ring.

Think about the payoff: new customers, possibly for life. How many cars will they buy? How many cars will their friends buy? Is there anyone out there listening?

There. That’s three new ideas. Anybody have any more?

Doug Harden

04-30-2003, 10:14 PM

Originally posted by WERM
.......I'm hugely disapointed that the great american V8 appears to be heading to a future where it's only available to the people who can afford luxury cars or high end sports cars. [/B]

To me, $30,000.00 is an extremely important price barrier....should the 5th gen return based over this threshold for a V8 model......I think it will be a sure death knell.....so why even bother.

It will be a sad day indeed should WERM's comment come to fruition......:death: :cry: :(

ProudPony

04-30-2003, 10:32 PM

Originally posted by newby
I would bet that hardly anyone, we're talking single-digit percentage, has thought about how much markup there is on their new car, seriously thought about it. I know a lot of people think the new car is expensive, but how many of them go beyond that? Most of them just plunk down their money anyway.
[/B]

P.T. Barnum is famously known for his quote,"There's a sucker born every minute." And also known for being the most successful circus owner in the world - charging people rediculous fees to see animals, performers, and pies.:rolleyes: He's a genious IMO.

I was in a restaurant Monday and heard the lady behind me telling her lunch companion that she ,"only paid invoice price, and got 0% - she got an awesome deal!" I wanted to pour my ice water on her head and tell her that she just gave her dealer about $5 grand, and the car maker even more than that - how AWESOME is that?!?! :p

But I'm not that kind of person. My point is - you are exactly right, people will buy anything. The heart-breaking part about it for me is that they are still happy thinking they got a great deal. :(
Not only do they not know, but most don't really care either.
I guess the fact that they are just happy is good enough.

ProudPony

04-30-2003, 11:12 PM

Originally posted by WERM
...but the profit margin does put some value in the trucks - because it allows the company to stay in business, supply parts and service and design new trucks.
I respectfully disagree. Profit is that portion of the price paid which occurrs AFTER all costs to produce the item has been deducted. The labor, design, overhead, etc is all accounted for in the cost of the vehicle - the product could continue to sustain itself if sold for that total cost to produce. Notice I said SUSTAIN, not grow, diminish, or change.

Originally posted by WERM
Well, do I think it's expensive? - absolutely. I wouldn't buy something like that knowing I would be lining someones pockets with $20K. But is it unfair? Not really. If nobody bought them, they'd either lower the price or stop selling them. There are lots of choices out there, and almost everyone buys their cars loaded these days.
Nobody said anything about "fair", I'm talking about gouging!;)
Apparently, nobody IS buying these overpriced units, that's why they are 86'ing it in 2 years. T-bird, Marauder, and a couple other high-end, high-profit models too.

Originally posted by WERM
Yeah, but how do you get rid of them? Have everyone pick their cars up at the factory? Default on the pensions of their workers? (BTW, companies like BMW that just set up in the states have a new workforce and little pension liability - allowing them to sell their cars cheaper and at increased profits.) What about the advertising? If they didn't advertise - they might not sell nearly as many trucks...
a)I'd pick mine up at the factory to save $2000 - and get a picture of it and a tour while I was there! ;) (J/K - a little humor is needed in this thread) Seriously, I'd like a couple options as to how I ship my car. I can get a car from Australia to my driveway for @$1200 - ask a military guy based overseas. I can have classic car haulers take my car from my driveway to Cali for $600 in a covered air-ride trailer. So why must I pay almost $1000 for a railcar/open car hauler trip to a dealer?
b)BMW in Greenville has to comply with all the same laws as every other company incorporated there, 401K, taxes, and benefits included. I don't see them in a "favored" position due to being new to the area. In fact, their benefits are as good or BETTER than the domestic plants nearby. People are on a post-tested waiting list to apply there.
c)Advertising is included in the "total manufacturer's cost" of the vehicle, defined in my previous post (with links) as the total "to design, engineer, plan, market, and put into manufacture" a vehicle. Again, profit is what is left over after all these expenditures, and profit margins are running 25 to 50% of the selling prices on average. Me no likey. :no:

Originally posted by WERM
...market forces would prevent that in absence of a monopoly - but I DO AGREE that I think the end result is an overpriced car, and I'm hugely disapointed that the great american V8 appears to be heading to a future where it's only available to the people who can afford luxury cars or high end sports cars.
That's my point as well. I hope you noticed that I claimed inherent value and quality have come a long, long way since the 60's and 70's models. I simply don't buy into the linear, single factor (inflation), adjusted-price theory claiming that we are getting a "bargain" these days. One car relative to other cars - sure. But that's because they ALL are overpriced to feed dealers, shippers, unions, and manufacturers all a tidy 10-25 points!

So we agree to the end result, but we just get there by different paths, cool? :cool:

ProudPony

04-30-2003, 11:39 PM

Originally posted by centric
What can we do about it?

I’d argue that we’re already doing something about it—discussing it in a public forum that the manufacturers monitor. By rejecting their party line, we’re sending a message. I could make a case for message boards undermining most corporate propaganda and marketing in the next few years, simply due to the way word spreads about good or bad products...

What else can we do? I wonder if it might not be time to write a book, something along the lines of, Hidden Costs: How Corporate Greed and Stupid Regulations are Destroying Your Quality of Life, which would expose rampant waste and mismanagement, such as described so well by ProudPony. Heck, you could do chapters on the RIAA, health insurance, and half a dozen other places where complexity has resulted in unnecessary consumer burden. Give people ways to fight back and beat the system—in the case of cars, by buying used, complaining vehemently to the automakers’ management, etc. Get enough people involved, and things will change.

Never get published? Put it up on the internet as a free PDF download. Hell, I’ll even volunteer to write it, even though I have a company to run.

Why am I so incensed? Perhaps because of something that ProudPony brought up in another thread: we’re Americans. We should be able to do anything we put our minds to—and do it better than anyone else. We shouldn’t be nay-saying little sheeple who come up with reasons why the automakers can’t make a V8 performance car for under $35K—we should be thinking around corners to come up with a way it can be done for $15K!

Ooh, but that’s the young market! It’s risky! It’s scary!

Bullcrap. Think around corners on that one, too. Don’t focus-group your way into a Scion. Sponsor one of the car racing videogames so you can put "upcoming" cars on it. Judge people’s reactions to them, and monitor what kind of mods they do to them. Take the best of them and put them in production. Done.

Or how about engaging the people you find on all the message boards to participate in the design of a new car? Fifth gen—hint, hint.

Or how about hiring young people to sell cars to other young people. Yes, I know they might only be able to do it after school, but they will be much more convincing than a 45-year-old ex-copier salesperson with a pinky ring.

Think about the payoff: new customers, possibly for life. How many cars will they buy? How many cars will their friends buy? Is there anyone out there listening?

There. That’s three new ideas. Anybody have any more?

I'm packing a bag... I'll be at your place tomorrow evening to start on the book with you!:D

Seriously, you are dead-on about getting the word out. THIS is the kind of thing that will help start the wheels turning. I think a few people in this little forum have learned something about how cars are priced in the last day or two.
And MEGA-KUDOS to newby for acknowledging that he finds it informing too. :bow:

You guys just need to read and understand for now. And if you have questions - ASK! PLEASE!!!! It's important that we all bring as much to the table as possible, and become informed based on FACT, not heresay or corporate brainwashing jargon. I deal with this crap 40+ hours a week, it's indirectly my job, so I'm intimate with it whereas most people are not. Once you feel that you understand it all fairly well, talk about these issues with your family and friends. Don't let them buy a car without you informing them about dealer cash, holdbacks, dealer rebates, and the incredible margins these vehicles carry for the maker. And heck, it's not just about buying cars, it's gas and the oil companies, it's real estate and realtors, investments and brokers, CD's and stores, clothes and retailers - it's EVERYTHING around us. But if we talk amongst ourselves, the word WILL get around. I stated in another thread that I don't buy new cars anymore - now you know why! I will someday, when I get my new Shelby Mustang :D to go in the garage with it's window sticker still on it, but my daily beaters will all be used - make that pre-depreciated to an acceptable level.

So the domestic guys are worried about market share, huh? Well I've got a solution... Start selling well-equipped Explorers for $17,000, isn't $2500 plenty of profit for one vehicle? Sell the F-150 for $14000. The Tahoe for $19,500. The Cavi for $9000. Then see how many move off the lots! Is it so crazy? Then how can Hyundai sell a 4-door car for less than $10k, offer a 10/100 warranty, AND oil changes for life, after shipping them here from Asia to boot!?!? Why did my buddy get a loaded Tundra for $18K? Think about it - :think:

Great post centric. You are really spurring me on with this topic, as if you can't tell. Nice to see someone take an interest (especially in something that means so much to me).
Thanks! :usa: :thumb:

centric

05-01-2003, 11:10 AM

ProudPony: if you want to collaborate on a book, I WILL write it. I'll probably work on it anyway, just because I think it needs to be done. By the way, both my wife and I are published authors . . . and I own an advertising agency. Think about it.

"The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man."

George Bernard Shaw

WERM

05-01-2003, 07:45 PM

Originally posted by ProudPony
I respectfully disagree. Profit is that portion of the price paid which occurrs AFTER all costs to produce the item has been deducted. The labor, design, overhead, etc is all accounted for in the cost of the vehicle - the product could continue to sustain itself if sold for that total cost to produce. Notice I said SUSTAIN, not grow, diminish, or change.

But if profit = 0, how will they pay for new cars, which cost hundreds of millions of dollars (if not billions) to develop? How will they sustain the company indefinately without new product? Who will invest in a company that doesn't make any money? They aren't a philantropic organization, why shouldn't they make as much money as they can? Isn't that why there in business?

Nobody said anything about "fair", I'm talking about gouging!;)
Apparently, nobody IS buying these overpriced units, that's why they are 86'ing it in 2 years. T-bird, Marauder, and a couple other high-end, high-profit models too.

This is where I disaree. Sure, some glaringly overpriced models are failing in the market place - but at the same time, the average price of a car is nearing $30k - up 9% in the last year. Why? Because most people buying cars are using the incentives and cash bonuses TO BUY A MORE EXPENSIVE CAR than they were buying before. This is one reason GM hasn't stopped the incentive madness!

a)I'd pick mine up at the factory to save $2000 - and get a picture of it and a tour while I was there!

How do you think I feel? I had to pay $500 to ship my car 18 miles. :eek:

I don't see them in a "favored" position due to being new to the area. In fact, their benefits are as good or BETTER than the domestic plants nearby. People are on a post-tested waiting list to apply there.

True - but since most of their workforce is young and few are retired, they have little or no pension liability and they don't have to provide healthcare or tons of other benefits to retired workers. GM spends $1200 per car on this and I guarantee that BMW is paying almost nothing in comparison.

That's my point as well. I hope you noticed that I claimed inherent value and quality have come a long, long way since the 60's and 70's models. I simply don't buy into the linear, single factor (inflation), adjusted-price theory claiming that we are getting a "bargain" these days. One car relative to other cars - sure. But that's because they ALL are overpriced to feed dealers, shippers, unions, and manufacturers all a tidy 10-25 points!

Remember, all of those people are CAR BUYERS, so it's not entirely bad to pay them enough so that they can afford to buy your cars!

Still, I don't think it's so much that cars are overpriced (there are plenty of cheap cars) as it is an absence of inexpensive cars to be excited about. But what can you do?

-Buy a less expensive or non-loaded car.
-Buy a used car
-Don't buy a car

...and if enough money stops coming in, the market will develop a solution - because there is money to be made!

So we agree to the end result, but we just get there by different paths, cool? :cool:

In a good conversation, not everyone aggrees, but everyone learns something. :thumb:

centric

05-02-2003, 10:38 AM

Maybe the fallout has started:

http://biz.yahoo.com/rb/030501/autos_sales_7.html

"Detroit automakers on Thursday posted sharply lower U.S. sales for April, dragging industry totals down 6.2 percent as high incentives failed to lure Americans away from a slew of new models offered up by foreign manufacturers."

Yes, Virginia, cars ARE too expensive. If a Explorer was $17.5K and a 4Runner was $35K, this would not be a problem.

(Just like if a CTSv was $36K and a M3 was $50K . . . nevermind.)

ProudPony

05-02-2003, 10:45 AM

Originally posted by WERM
But if profit = 0, how will they pay for new cars, which cost hundreds of millions of dollars (if not billions) to develop? How will they sustain the company indefinately without new product? Who will invest in a company that doesn't make any money? They aren't a philantropic organization, why shouldn't they make as much money as they can? Isn't that why there in business?
I disclaimered myself in the statement by stating "SUSTAIN, not grow, diminish, or change". They DO deserve a profit - that's what capitalism is all about. I just want people to understand that it doesn't cost $25K to build a car that MSRP's for $30k. I also want people to understand that greed is ruining the American corporate society - they can't get enough. Carmakers demand, and often get, price-cuts on the materials we provide them, and I have to work to make those cuts happen. But when was the last time you saw the CONSUMER get an actual price reduction on a Vette? What's good for the goose should be good for the gander.

Originally posted by WERM
True - but since most of their workforce is young and few are retired, they have little or no pension liability and they don't have to provide healthcare or tons of other benefits to retired workers. GM spends $1200 per car on this and I guarantee that BMW is paying almost nothing in comparison.
Don't get me started on healthcare!!!:irk: They're just as guilty as the car makers at gouging us!!!
When the billed rate for me to get my teeth cleaned is $127, for a 20-minute job consisting of buffing with a high-speed pneumatic drill, picking, and flossing - SOMETHING'S WRONG THERE TOO. It still costs me about $15 out of pocket to boot! My barber has me in the chair for 15 minutes and only socks me for $12. :rolleyes:

Again, I can't justify letting the carmakers secretly reap huge profits just to JUSTIFY the costs of high healthcare. That's like the pot calling the kettle black dude, or two-wrongs make a right. And in fact, this serves to SUPPORT my stance that our whole ecomony is artificially inflated - mostly to justify it's own overinflatedness. :confused:

One last point - if GM had INVESTED the pension moneys that were witheld from every person's paycheck AND LEFT IT ALONE, the monthly pension payments would be coming from the PENSION FUND ITSELF (where it's supposed to), not leeching $1200 from the margins on cars being produced TODAY.
Now ask me why the pension fund got used for "other reasons" than pension disbursements anyway... :D I'm ready for that one!

Having a great time with you WERM - you're a class act, and I respect your position greatly. Thanks for the great debate!:bow:

Eric Bryant

05-02-2003, 12:25 PM

Originally posted by ProudPony
Carmakers demand, and often get, price-cuts on the materials we provide them, and I have to work to make those cuts happen. But when was the last time you saw the CONSUMER get an actual price reduction on a Vette? What's good for the goose should be good for the gander.

Exactly. I'm sick of the American OEMs screwing things up, not figuring out how to save money elsewhere, and then deciding to beat up the supply chain in order to compensate for their own inefficiencies. Whatever money they save after bending us suppliers over, they simply take and piss away.

The only thing saving the Big Three right now is that Honda and Toyota care more about profit margin than sales numbers. If either one of those guys ever decided to accept, say, a 2.5% profit margin, and dropped their prices accordingly (this would take nearly $1500 off the price of a $25K car), I think it'd be a bloodbath in the pass-car market.

I guess the bottom line is that I'm sick of paying for someone else's inefficiency in two ways - in my paycheck every time one of our customers wants a 5% cost-reduction, across the board, or else, and then a second time when I take what's left of my paycheck and plop it down for a vehicle.

ProudPony

05-02-2003, 12:46 PM

Originally posted by centric
Maybe the fallout has started:

http://biz.yahoo.com/rb/030501/autos_sales_7.html

"Detroit automakers on Thursday posted sharply lower U.S. sales for April, dragging industry totals down 6.2 percent as high incentives failed to lure Americans away from a slew of new models offered up by foreign manufacturers."

Yes, Virginia, cars ARE too expensive. If a Explorer was $17.5K and a 4Runner was $35K, this would not be a problem.

(Just like if a CTSv was $36K and a M3 was $50K . . . nevermind.)

And this...
http://biz.yahoo.com/rc/030502/autos_general_research1_1.html

Short and sweet.

ProudPony

05-02-2003, 12:56 PM

Funny, but in a time of economic grief, here's an OEM supplier that just set record profits and growth for itself...
on an average 14% margin - gross too!!!

http://biz.yahoo.com/prnews/030502/def004_1.html

"Gross margin was an all-time first quarter record of 14.8%, a 100 basis point increase as compared to the 13.8% margin reported in the first quarter of 2002."

Yet GM, Ford, and DCM need 20-25% just to stay alive... :confused:

ProudPony

05-02-2003, 01:12 PM

And here's another one to look at...
My cost for healthcare through my employer has gone fro $99/month in 2000 to $137 in 2003 - that's 37% total, or @ 10% annual accumulative. Who knows how much more my company is paying on my behalf too. And lo-the-behold, if my health insurance company isn't MORE profitable to show for it... :irk:
http://story.news.yahoo.com/news?tmpl=story&cid=568&ncid=749&e=5&u=/nm/20030502/bs_nm/health_cigna_earns_dc

Yup, that's the good ol' system at work for you.
But aren't we getting a great deal on health care these days? As opposed to Malaysians, Iraqis, or Afghans anyway?:rolleyes:

newby

05-02-2003, 01:24 PM

Great debat guys:bow:

Here's something interesting. In another thread someone was saying Ford is going to release the 05 mustung summer of next year, at least the V6 and GT versions. Starting prices will be set at 18,000 I think is what was said. So going by that, I can't imagine a GT going for much more than 25,000, can you? That's 7,000 dollars over the base, which sounds reasonable.

Maybe I'm way off on that, but if the 05GT comes along for 25,000, why can't the new Camaro?

ProudPony

05-02-2003, 01:35 PM

Rising gas prices are due to rising costs of crude, right?
That would mean that oil companies are having to pay more for their raw materials required to produce the product, right?
They claim they have to pass the higher costs on to the consumer, right?
So they theoretically aren't making any more money on us due to higher pump prices, right?
It all makes sense right?
At least that's what they want us to beleive anyways...

Then somebody explain these to me...
Chevron/Texaco (http://story.news.yahoo.com/news?tmpl=story&u=/afp/20030502/bs_afp/us_results_chevrontexaco_030502162659)
"ChevronTexaco said its profit almost tripled in the first quarter compared with a year ago, as the Iraq war and turmoil in Nigeria helped push crude oil and gas prices to historic highs. "

Shell (http://story.news.yahoo.com/news?tmpl=story&u=/afp/20030502/bs_afp/britain_oil_company_030502121143)
"Anglo-Dutch oil giant Royal Dutch/Shell Group saw its profits nearly double in the first three months of the year as oil prices soared in the run-up to the war in Iraq."

Exxon/Mobil (http://story.news.yahoo.com/news?tmpl=story&u=/keye/20030502/lo_keye/exxonmobil_triples_profits)
"The world's largest publicly-traded oil company says first-quarter profits more than tripled from a year ago. ExxonMobil credits higher prices for crude oil and natural gas."

Conoco/Phillips (http://story.news.yahoo.com/news?tmpl=story&u=/nm/20030430/bs_nm/energy_conocophillips_earns_dc_3)
"ConocoPhillips and Kerr-McGee, two large U.S. oil companies, posted blockbuster first-quarter results on Wednesday as soaring prices for oil, natural gas and refined fuels pumped up profits. "

British Petroleum (BP) (http://story.news.yahoo.com/news?tmpl=story&u=/ap/20030429/ap_on_bi_ge/earns_bp_1)
"Adjusted for one-time items, BP reported a quarterly replacement cost profit of $3.73 billion, up from $1.58 billion last year. " That's pretty much DOUBLE in one year.
"BP benefited from an average rise in crude prices of $11.05 per barrel compared to the same three months of 2002..." (Now somebody explain to me how the f__k they benefitted from paying more for the crude?!?! :D )

BP Direct (http://story.news.yahoo.com/news?tmpl=story&u=/afp/20030429/ts_afp/britain_oil_company_030429111638)
"British oil giant BP reported a 136-percent leap in quarterly profit, boosted by strong oil prices in the run-up to the war in Iraq."
"BP posted pro-forma profit, adjusted for special items, of 3.73 billion dollars (3.39 billion euros) for the first three months of 2003, which it said was a record result. "

Hess (http://story.news.yahoo.com/news?tmpl=story&u=/nm/20030429/bs_nm/energy_amerada_earns_dc_2)
"Integrated oil company Amerada Hess Corp. (NYSE:AHC - news) on Tuesday said first-quarter profit rose 25 percent as higher oil and gas prices boosted exploration and production income while tight petroleum product inventories buoyed refining margins."

So have I missed anybody?

Anybody got any questions about why pump prices go up now?

I could go on, but I need to get some work done and I think y'all get the point about how large corporate America is controlling OUR wallets to THEIR benefit.

I think I've given you enough to read for a while!
Proud:cool:

WERM

05-02-2003, 06:04 PM

Originally posted by ProudPony

Anybody got any questions about why pump prices go up now?

Lol, yeah but with 50% of US vehicle sales Trucks and SUV's, It seems like we are asking for it!! :mad:

PS: Don't even get me started on the rip offs that are health care and phone service. We'd need a whole other forum. :mad::irk: :yuck: :mad:

kizz

05-02-2003, 11:01 PM

For what it's worth, I heard this on the radio today:

GM's April sales down 9% from last year.

Ford's April sales down 7% from last year.

DCX's April sales down 10% from last year.

They had some additional GM snippet about how GM's CAR sales contributed to most of that 9% decline. Go figure.

gt

mcmb

05-04-2003, 11:10 AM

Originally posted by ProudPony
OK - not typical for me to be close-minded, but I am going to be this time.

When you machine a stamping die to make a steel fender, hood, or trunk lid, the cost of the steel for the die is fixed - regardless of the car the fender is intended to go on. The machining time is roughly the same to machine the shape of the fender, so machining time is a wash between models too. Installing the die in a press, loading rolls of sheet steel, etc all take the same basic amount of time as well. Stamping presses can produce large or small fenders at the same cycle rate - 1 cycle = 1 fender - and the presses run at @20 strokes/minute. Actual tooling cost and cost/part across the models varies only a small bit at the OEM level. Pricing (especially outside) is cut-throat it is so tight. It really doesn't matter if the company is tooling up for a Cavi fender, GTO fender, or a C/K1500 fender, the tooling costs are almost identical. The cost-savings come in making as many parts as possible ON THAT TOOL AFTER IT'S BUILT. Distributing the entire $250k price of the stamping die across 400K units adds only (250,000/400,000 =)62.5 cents to the cost of a Cavi fender, but $250k across 40k units adds (250,000/40,000 =)6.25 dollars to the cost of a GTO fender. And only (250,000/900,000 =) 27.7 cents for the C/K fender!:shock:
My point is, tooling cost is not so important as many beleive. It is volume dependent, and that's why raiding a "corporate parts bin" is so economically fruitful these days.

Next issue is this labor thing. I don't hold anything against a hard-working UAW person - but when I, as an engineer with 8 years of college education and a 4-year apprenticeship as a tool and die maker, saving $millions for my company each year, scarcely make more than a high-school graduate working in a paint booth - there's something wrong. Again, I'm not anti-union or pro-union, but look at what has happened to unionized companies in the last decade... and not just auto workers either - look at the airline industry for example. That guaranteed high-paid job they fought so hard for has resulted in them "pricing themselves" right out of work. It is a no-brainer IMO.

Proud:mad:

Come on now. You can REALLY put out 400,000 fenders on a die WITHOUT having to pull it multiple times for a rebuild?? That adds a LOT of $$$ to the per unit cost! And while I might agree on principal about the high-school kid in the paint booth, It seems that a lot of people are slamming the amount the workers get paid, (And it does add up with pensions, health, etc.) but aren't these the same people who want the excellant fit and finish, good performance, etc? If you want the car companies to lower cost by cutting worker benefits don't complain when Jose and Juan screw up and your new car is a piece of sh*t. Also, we have to remember, (when we are thinking about how many years of training we have, and how few others have and they still make a decent wage) that there will be a continuing increase in the number of trained people out there in the workforce due to companies cutting labor costs and shipping our jobs to other countries. Perhaps then, when nobody can get a decent job here, and the poor quality of the products bring the costs down for everybody, then we will have a Corvette for a price some of these people think is fair. (Of course, since they will be unemployed, they STILL won't be able to afford it!!) In other words, if you want quality you have to pay for it. If you are willing to pay for it, don't complain if the person who brings you the quality makes a buck or two. If you are more concerned about cost than quality, don't complain about the people who prefer quality over cost. And last, when traveling the country looking for a new job because the guy who's job went to Mexico is willing to do yours for a couple of bucks less, remember (as the plane slowly rolls over, and hits the ground) You're the one that wanted lower qualified pilots who make less money. And that's the end of my slightly one-sided opinion.

ChewyChevy

05-04-2003, 11:11 AM

I agree with a lot of what ProudPony and Werm have posted. For myself, I will NEVER buy a new car. Even if I buy into the medical care, advertising and creating new cars costs; cars depreciate in value too quick today. Most cars value cut in half at around 4-5 years, if not more.

I could not see myself paying anything more then 20 thousand dollars for a car. I would rather wait 5 or even 10 years to pick up an 03 Cobra or an 03 Vette and get it for 1/5th the price or even less. Spend another 5 grand into making it run fresh again and I still save more. The power level cars are going today, I won't be too much slower then the fastest cars on the road in 10 years.

For a beater car, I will never pay 20 grand for a 4 banger mobile or sedan. For that cost, I can pick up a used beater and keep it running for another 15 years+. I cringe when I hear my sister talking about paying 30 grand for a new Acura TL. Talk about media brain-washing, desire for status and peer pressure. It'll be worth 25-26 grand in a year and probably under 20 grand in 3. My mom's Rav4 in 99 cost her 22 grand and it's worth around 9 grand now halfway into 03

Alex

ChewyChevy

05-04-2003, 11:32 AM

MCMB you bring up some interesting points. I do agree with some of them up to a point. To address your first statement. 400,000 units, let's say he rebuilds it and it costs his company half a million to rebuild it all the times it breaks down. That adds 1.25 dollars to the per unit cost.

This is a gross generalizatoin but let's say 100 components fail like this. so it costs 125 dollars more per unit to create. Yes this is a big loss in the mind's of corporate terms. But when you're making 20,000 dollars a car and have to take a 125 dollar cut, most individuals won't mind. The company would probably raise the cost of the car 125 dollars. When people are paying 20 grand for a car, I doubt they notice 125 dollars, not to mention people paying 40 grand a car.

There's no need for the company to cut employee benefits at all. That wasn't even mentioned in anybody's argument. It seems like you believe in capitalism in your argument about having to pay for the quality we get. Then is it not capitalistic and in the best interest of big business to ship our jobs to other countries where they can be done cheaper??

I don't quite understand your pilot argument as it comes out of nowhere. Also, there are some of us who are unwilling to pay this ridiculous amount for some quality. We don't pay these prices and we don't buy new cars. I don't consider 3000 to 10000 dollars a car, a buck or two. The same level of quality can be provided with less cost. I think looking at some of the links provided in this thread may give you deeper insight, not neccesarily change your point of view, but give you some idea of why ProudPony said what he did.

Alex

mcmb

05-04-2003, 07:26 PM

The pilot comment is because he mentioned the airline workers pricing themseves out of work. (And personally, if an airline pilot makes $100.000 a year it's fine with me. He had to do his years of training just like anybody else, and he just may have my life in his hands. I'd rather be flying with the guy who has a job he wants to keep, rather than the guy who's pissed-off because he can't make ends meet on what they pay him.) Anyway, the cost per unit of die maintenance is probably a bit higher than you are thinking. Example, a 100 ton press is making brackets. With the cost of carbide, etc. it costs $20,000 to set up the die. The press is supposed to be putting out 50,000 parts in an 8-hour shift. If said die breaks a perf, a punch, a horn, etc. it can easily be down for 3 to 4 hours. Already making a loss of up to 25,000 units. Then add in the cost of replacement for what broke, the hourly pay of the toolmaker (plus benefits), the hourly pay of the person operating the press (plus benefits), etc. and you start to see. On a 100 ton press the die can be removed using a forklift. Cost of forklift, driver's pay (and benefits), cost of overall maintenance on the forklift, etc. etc. By the time it's all done and said, the overhead for that one breakdown can be quite a bit, and these are accepted breakdowns. (Can't be avoided if you want to make a quality part). Now, of course, you CAN look at said bracket, (or fender, or brake rotor, or airbag, you get the point) and say, "it's not THAT bad. Let's just run it for a couple more hours. Save on the overhead." (ProudPony should know what I mean) Well I don't really want one of those "run it anyway" parts in my car!! I move that we can not maintain the levels of quality we expect, and at the same time cut the cost of production, and therefore the cost to the consumer. If you can show me an honest way of cutting the cost, and still keeping the quality, I would like to see it. Slamming the companies, or the unions, because they are trying to do exactly what everybody else is doing, (look out for themselves) is not the answer. Maybe the problem is that everybody wants everything, they want it right now, and they want it to be very good but very cheap, (so they can afford more of everything). Also, it IS in the interests of big business to ship our jobs to other countries where they can be done cheaper. The reason for that is because nobody wants to pay for the kind of quality that is produced in this country anymore. (And don't say the quality is just as high. I personally know of one major electronics company that is moving production to Mexico. They had a reject rate of about 10% here. They figure a reject rate of up to 50% will be expected, and acceptable, in the future, due to the savings they will realize in this move.)---(It's pretty sad when a kid fresh from college has to face the fact that due to NAFTA he can't find the job he expected within a reasonable amount of time, and just maybe not at all!!!) But anyway, I'm done on this subject now. Who want's to hear me b**ch anyway??? Besides, I thought this was some kind of 5th GEN. CAMARO board.

ProudPony

05-05-2003, 09:55 AM

OK - first things first...
I appreciate that you took the time to post!
I also appreciate your point of view.:)

Originally posted by mcmb
The pilot comment is because he mentioned the airline workers pricing themseves out of work. (And personally, if an airline pilot makes $100.000 a year it's fine with me. He had to do his years of training just like anybody else, and he just may have my life in his hands. I'd rather be flying with the guy who has a job he wants to keep, rather than the guy who's pissed-off because he can't make ends meet on what they pay him.)
I'll leave your pilot example alone, even though I have disagreements with it. (Does a bus driver or a cabby have anyless control over your life than a pilot? Did you know a 737-400 can take-off, fly a plotted plan, and land - all AUTOMATICALLY? No pilot needed? This technology has been in place since the mid '80's, but airline co's thought people wouldn't get on a plane without a pilot at the helm.)What about the baggage handler making $45K, the counter clerk making $42K, the reservationist making over $40k(my sister does this for US AIRWAYS dude), the Stuardess making $40K+, and everyone else?

Another thing, if I want a car that my company makes parts for, I get to buy it for a percentage over cost - flat out. If airline workers want to take a trip on the carrier they work for - IT'S FREE! So how is it they can used the system burdened with labor and capital for free? SOMEBODY is getting to pick up the tab... yup, the paying customer. ;)

Originally posted by mcmb Anyway, the cost per unit of die maintenance is probably a bit higher than you are thinking. Example, a 100 ton press is making brackets. With the cost of carbide, etc. it costs $20,000 to set up the die. The press is supposed to be putting out 50,000 parts in an 8-hour shift. If said die breaks a perf, a punch, a horn, etc. it can easily be down for 3 to 4 hours. Already making a loss of up to 25,000 units. Then add in the cost of replacement for what broke, the hourly pay of the toolmaker (plus benefits), the hourly pay of the person operating the press (plus benefits), etc. and you start to see. On a 100 ton press the die can be removed using a forklift. Cost of forklift, driver's pay (and benefits), cost of overall maintenance on the forklift, etc. etc. By the time it's all done and said, the overhead for that one breakdown can be quite a bit, and these are accepted breakdowns. (Can't be avoided if you want to make a quality part).
Problem 1 with this scenario is that the rate you offered is unrealistic. 50k fenders/8 hours? Even to run the F-150 batch of 900k units/year would only take 6 working days!!!
A 100-ton press is not going to run 50k in 8 hours - that's 6250/hour or 105units/minute. BIG presses (hydraulic) can only cycle about 4-8/minute, allowing sheet feeding and unload cycle times. So backing out the $125/each in lost money is too high. I GET YOUR POINT THOUGH, and you are right, there will be break-downs and such that add cost unexpectedly, but not THAT much.
(BTW, our Bruderer 40-ton presses run at speeds of over 1200/minute stamping .015" berylium-copper (spring steel) contacts, stroke is about 1.25", a die costs between $125k and $250k, the dies have up to 22 stations in progressive design, dies weigh about 300lbs, and they run for 48-72 hours between sharpenings and maintenance! That's 3,456,000 parts on a minimum run! So dies CAN run 400k cycles easily, if designed and built well. And forming dies typically need LESS maintenance than cutting/profiling dies to boot, due to cutting edges getting dull and needing sharpening.)

Originally posted by mcmb Now, of course, you CAN look at said bracket, (or fender, or brake rotor, or airbag, you get the point) and say, "it's not THAT bad. Let's just run it for a couple more hours. Save on the overhead." (ProudPony should know what I mean) Well I don't really want one of those "run it anyway" parts in my car!! I move that we can not maintain the levels of quality we expect, and at the same time cut the cost of production, and therefore the cost to the consumer. If you can show me an honest way of cutting the cost, and still keeping the quality, I would like to see it.
All I can say here is that the part either MEETS the QC spec, or doesn't. If it doesn't, it BETTER BE FAILED. Most car makers are ISO-9000 (or higher) certified, and require their suppliers to be also. This requires the supplier to take frequency samples, and random samples or parts for QC. Some processes are even required to monitor QC for 6-sigma process. We have to remove a processed part directly from the machine every hour and do a full inspection, documenting deviations from nominal dimensions, and enter these measurements into a computer data log for SPC auditing.

If a supplier sends parts to a car company, and the quality deviation is out of the allowable standard deviation (dimension, weight, finish, whatever the desired metric for quality is) the supplier is likely to not just eat that bad batch, but lose their contract AND buy back all the previously supplied parts too if they are found out of spec. I just don't think getting a sub-standard part on your car is really a possibility - especially INTENTIONALLY. Now a bad one is going to slip through UNDETECTED from time to time, but I'd lose my job INSTANTLY if I signed-off for a process to be run out of spec.

Originally posted by mcmb Slamming the companies, or the unions, because they are trying to do exactly what everybody else is doing, (look out for themselves) is not the answer.
I'm not "slamming" them. I even said so in my first post about it. But it is MY OPINION that many unionized workers have enjoyed higher pay and benefits than non-union shop workers for many decades now. I guess it's time to pay the band for all that fine music... :(
How is it that Toyota, Nissan, Honda, and all these other foreign companies can come into the US and build plants here, staff them with US-workers, and make cars HERE, and sell them for MUCH LESS than competitive domestic units, meet 401K goals, provide benefits as good or better than domestic companies, and still be profitable? The one biggest factor is, they are not union shops. And beleive you-me, the UAW is trying everything they can to change that!

continued...

ProudPony

05-05-2003, 09:57 AM

continued...

Originally posted by mcmb Maybe the problem is that everybody wants everything, they want it right now, and they want it to be very good but very cheap, (so they can afford more of everything). Also, it IS in the interests of big business to ship our jobs to other countries where they can be done cheaper.
Nothing wrong with wanting it done right. IMO it should be done right, or not at all. But if right can be done for $X, there is no just cause to charge $3X for doing it.

The only interest for big business to move jobs outside the US is to avoid higher labor costs and fees - i.e. the union dues, higher wages, and silly crap like job description violations for one example. (I guess you've never had a grievance filed against you by a janitor because you took a moment to sweep your area to keep it tidy and neat, huh? :rolleyes: ) There are also the costs of healthcare, 401K matches, and profit-sharing that don't come into play when you are utilizing Chinese labor. And since there are fewer US workers to share that profit with, the CEO's and Directors get an even nicer share for themselves - how conveeenient, huh! Like it or not, there IS a reason for this "system" of labor movement - it's called GREED.

Originally posted by mcmb The reason for that is because nobody wants to pay for the kind of quality that is produced in this country anymore. (And don't say the quality is just as high. I personally know of one major electronics company that is moving production to Mexico. They had a reject rate of about 10% here. They figure a reject rate of up to 50% will be expected, and acceptable, in the future, due to the savings they will realize in this move.)---(It's pretty sad when a kid fresh from college has to face the fact that due to NAFTA he can't find the job he expected within a reasonable amount of time, and just maybe not at all!!!)
I'd be happy to pay for the quality - a FAIR price. I don't expect something for nothing, but likewise I don't expect to have to pay 3-times what it costs to do it right. I have $720-worth of Michelin 6-plys LTX's on my F-250, does that sound like I'm a cheapskate? I wanted the best, safest, most durable tires I could get to pull cars in a trailer behind me at 70mph. Cheaper ones were $400-600/set - and they were just that - cheaper.

Your employer is a decade late moving into Mexico. Labor rates are too high there now, beleive it or not. Companies are now moving lines from Mexico to Asia for better labor rates. FWIW, we too had issues with Mexican labor skills, and we refused to move our best automated equipment to Mexico, not because they couldn't RUN the machines, but they didn't have the skills to WORK on the electronics or high-precision tooling if something did go wrong.

Originally posted by mcmb But anyway, I'm done on this subject now. Who want's to hear me b**ch anyway??? Besides, I thought this was some kind of 5th GEN. CAMARO board. :)
I DO - I DO - I wanna hear you b1+ch! I openly invite any and all comments about our current state of affairs in Corporate America.

And this has EVERYTHING to do with a 5th Gen... will it be designed or built in AMERICA, or by foreigners in an American plant, or will it be built and designed in CHINA and shipped here on a boat?!?! Am I to beleive you really don't care?!?!
If we soon don't start acting like partriotic, educated buyers, letting these big greedy American Conglomorates know what we think and how we feel, there will be no America to be proud of... we'll just be another country in the world - once great but now common (or worse - broke).
Is it so hard to beleive? Look at the fall of the USSR and Russian Empire... economic conditions can be much more damaging than a war when it come to a country's power and wealth. Japanese empire of the 1930's - same deal. Germany after WWII. I can go on and on about countries that were once powerful and wealthy that lost it all and fell back into common ranks due to GREED and a population that was uneducated in the procedures/processes they were living under.
PLEASE THINK ABOUT IT.

mcmb

05-05-2003, 08:49 PM

Ok, We'll leave the airlines out of it. As for my numbers on presses, in my example I was using BRACKETS, not fenders. (It is what I know about, and the same principal applies.) On our 100 ton, and 150 ton Minsters we run 13 gauge steel brackets at between 80 and 120 spm. That comes out to 50,000 per shift. We run our 60 and 80 ton presses anywhere between 400 and 750spm, stamping .020 to .035 steel laminations. We can put a die out on the floor and easily have it back in tool & die in the same shift. (Granted your copper contacts are softer so your dies will last longer). We are an ISO 1400 company, and we DO have the QC problems I mentioned. (It's not supposed to be that way but it is.) While we don't make parts for cars, I would place a good bet that if you buy "quality" brand-name electronics you have some of our merchandise. (Again, the same principal applies to cars and electronics.) As to "How is it that Toyota, Nissan, Honda, and all these other foreign companies can come into the US and build plants here, staff them with US-workers, and make cars HERE, and sell them for MUCH LESS than competitive domestic units, meet 401K goals, provide benefits as good or better than domestic companies, and still be profitable?" How is it that an ethanol plant can be built for 5.5 million, and get 3 mil from local and county government, PLUS 3 mil matching funds from the state, PLUS 1.5 mil tax incentitive over the first 2 years of production, PLUS a new railroad line put in at county, state, and the railroad companies expense, which is meant only to serve this ethanol plant?? Answer--Government incentitives. (Somebody wanted it here PRETTY badly, so they pulled strings.) I suppose the same type of thing may have happened for these foreign companies. (It makes some people look real good at election time to be able to say they are the ones that got the new plant put HERE, instead of one state over, plus they might even get some kick-backs.) As far as unions go, if you are in one then maybe your job is safe when my plant completely closes down and goes to Mexico. If not, how much do you make? I can do it for 4 bucks less an hour. (With 10 solid years behind me too!) As far as the Michelins LTX's on your F-250, That's my point exactly, YOU GET WHAT YOU PAY FOR. As to--"Your employer is a decade late moving into Mexico. Labor rates are too high there now, beleive it or not. Companies are now moving lines from Mexico to Asia for better labor rates. FWIW, we too had issues with Mexican labor skills, and we refused to move our best automated equipment to Mexico, not because they couldn't RUN the machines, but they didn't have the skills to WORK on the electronics or high-precision tooling if something did go wrong." ---I'm glad for that, and I agree with you 100%. It's the ONLY reason my plant is still here in any capacity. (Even though that looks like it will end this year.---Oh well, there's always all that good NAFTA-paid training. HA HA). I do think we are, if not on the same page, at least close though. It's just, the way I look at it, if people didn't expect to get everything for nothing these days we might not have some of these problems. And I don't think "If we soon don't start acting like partriotic, educated buyers, letting these big greedy American Conglomorates know what we think and how we feel, there will be no America to be proud of... we'll just be another country in the world - once great but now common (or worse - broke)." will do it. After all, who's it going to help if everybody buys the other guys product in order to let "these big greedy American Conglomorates know what we think and how we feel"? It ain't gonna help me, and it ain't gonna help you!!!! (Might help Juan and Suki though).

mcmb

05-05-2003, 09:05 PM

Originally posted by ProudPony
continued...

And this has EVERYTHING to do with a 5th Gen... will it be designed or built in AMERICA, or by foreigners in an American plant, or will it be built and designed in CHINA and shipped here on a boat?!?! Am I to beleive you really don't care?!?!

P.S. If you all REALLY want a 5th GEN Camaro, made in AMERICA, by AMERICANS, the just go out, buy a new 'vette, (or at least some OEM parts. STOP supporting the Taiwan aftermarket companies) put GM over the top in sales so far that they will realize people WANT a Chevy performance car, (not a *** car). Then when they put out the new F-body, sell the 'vette (you should get a GOOD price for it), and buy one.------It's the AMERICAN WAY!!!!!

mcmb

05-05-2003, 09:33 PM

Or, perhaps, read the "Domestics vs. Imports" thread in this forum. He seems to have the right idea!!!

ProudPony

05-05-2003, 10:10 PM

Originally posted by mcmb
How is it that an ethanol plant can be built for 5.5 million, and get 3 mil from local and county government, PLUS 3 mil matching funds from the state, PLUS 1.5 mil tax incentitive over the first 2 years of production, PLUS a new railroad line put in at county, state, and the railroad companies expense, which is meant only to serve this ethanol plant?? Answer--Government incentitives. (Somebody wanted it here PRETTY badly, so they pulled strings.) I suppose the same type of thing may have happened for these foreign companies. (It makes some people look real good at election time to be able to say they are the ones that got the new plant put HERE, instead of one state over, plus they might even get some kick-backs.)
Well, you said it, not me. Isn't this GREED? I agree, big people in big places with big money are the ones that make things like that happen, yet if you knew the WHOLE truth, you'd probobly be suprised to know that the big plant is actually getting to write-in the full cost-to-produce against their product's price-as-charged to their customers, who are probably 3 states away. So their customers are providing them large margins on products that really were "discounted" to the plant due to the local incentives you mentioned... Taxpayers foot the direct bill for the tax-breaks and utility charges, AND the consuming public gets to pay the same elevated prices for the plant's end product ANYWAY.
That's double-dipping the working stiff if you ask me, and it's WRONG.

I know the same thing happened in SC when BMW moved into Spartanburg, because the tax-package is what helped SC win the site over NC's bid. That fact not withstanding, BMW, Honda, Toyota, and others are STILL proving themselves more profitable than domestic car compnies WITH American labor and sub-contractors. And I know that a Ford or GM plant would get the same fight for tax-advantages that a Hyundai plant would here. :rolleyes:

Originally posted by mcmb
As far as unions go, if you are in one then maybe your job is safe when my plant completely closes down and goes to Mexico. If not, how much do you make? I can do it for 4 bucks less an hour. (With 10 solid years behind me too!)
I don't get it? Do you want to know what I make or how much I could stand to lose and get by? I am not a union member - nor will I be. I am self-motivated and I WANT to fend and fight for my own stake and earnings. I want to do as I see fit for my interest and the interest of my employer - without being regulated or charged for my own self-management. If I don't like my job or anything about it, I'm not going to gripe to my union rep - I'll quit and do something else. After all, this is America - the land of opportunity! (or at least for a few more years i hope :( )

Originally posted by mcmb
And I don't think "If we soon don't start acting like partriotic, educated buyers, letting these big greedy American Conglomorates know what we think and how we feel, there will be no America to be proud of... we'll just be another country in the world - once great but now common (or worse - broke)." will do it. After all, who's it going to help if everybody buys the other guys product in order to let "these big greedy American Conglomorates know what we think and how we feel"? It ain't gonna help me, and it ain't gonna help you!!!! (Might help Juan and Suki though).
Don't give up just to give in, dude! Look, if nobody buys a $50k CTSv, then GM will learn that it is futile to make such a car and put such a price on it. Likewise, if you stop buying $18 music CD's, the dealers WILL drop their price or they'll go out of business, and the star singers won't be signing $10-million record deals either. If you stop paying $65 for a seat at a ball game or NASCAR race, the price WILL drop, or the places will go broke. Ball players will stop getting $30-million/3-year deals, and NASCAR races will stop paying out $8-million winnings at every race. THESE are the things we can do to impact things where they matter. It's not like we need to stop buying a gallon of milk to spite the grocery store - but we end up killing the farmer instead - that would be silly and futile. And I don't want to be stupid with my actions at all, I want to send a clear and concise message about how I value my earned money.

We need to discuss these point in public, and the public needs to react en-masse to get the message across - "We are sick and tired of being fleeced for the general increased wealth of the elite and/or policy makers."
I'm personally sick and tired of being nickled and dimed to death. I'm fighting it already. You can join me, or you can go it alone. That's the beauty of our fine nation - freedom to speak, and freedom to choose. :usa:

Originally posted by mcmb
I do think we are, if not on the same page, at least close though. It's just, the way I look at it, if people didn't expect to get everything for nothing these days we might not have some of these problems.
Well, I think we're on close grounds anyways. ;)
I don't think most sensible people really want "something for nothing" as you indicate, I think most people just want "something of fair quality for a fair price". I know that's how I feel anyways. :cool:

Thanks for replying! :bow:

ProudPony

05-06-2003, 10:33 AM

OK - Is there anybody in this forum/thread that doesn't think we're gettin' gouged by the automakers?

Anybody...

If so, please speak up now before this gets REAL ugly...

ANYBODY who doesn't beleive that we (the American car buyer) are not victims of a conspiracy, by the carmakers and their dealers, to maintain car prices as high as possible in our "wealthy" nation... READ THIS.

Same cars can cost oodles less in Canada (http://story.news.yahoo.com/news?tmpl=story&u=/usatoday/20030506/bs_usatoday/5131610) from Yahoo Neswire - dated today.

"Odds are that new car you bought in the USA is being sold for less money -- maybe thousands less -- in Canada. "

"...automakers have attempted to crack down on sellers and buyers. In turn, the automakers have been sued on behalf of buyers. If the automakers can't stop the import numbers from growing, they face yet another erosion of profit..."
Who are they (automakers) to crack down on THE BUYER for getting a good deal!!! I praise the dealer willing to sell a vehicle for a modest profit instead of a king's ransom! The factory obviously got what they wanted for the car, or it would have not been delivered, or better yet reported stolen.

"Automakers call the price differential ''pricing to the market.'' They say they price cars lower in Canada -- anywhere from 1% to 40% -- because wages and economic conditions are below those in the USA, and taxes are higher. It's what the market will bear, they say."
Ahhh yes, "WHAT THE MARKET WILL BEAR". Have you guys heard me say that anywhere else in this thread? Now you've heard it from THEM too.

"But some U.S. dealers, brokers and buyers say it's price gouging. ''It's not right,'' says Dave Pierce, a Great Falls, Mont., new car dealer"
Yeah, no sh1+ Sherlock. That's what I've said for years - welcome to the 20th century... :rolleyes:
My problem with him is that he's mad because he can't gouge the public because of where he lives, and he's crying about it. :mad:

"a new loaded Dodge Caravan that costs me $28,000 from the factory, I could get delivered to my door from Canada for $19,500."
Oh Noooo, nothing wrong with this picture. Heck, it's probably got something to do with "knowing the right person", or getting the guy in a "dealing mood", huh? :irk:

Dammit guys, if y'all can't see what's going on in front of us after reading this whole thread and especially this article, WE'RE DOOMED.

The best way to rob your granddad blind is to take a quarter or dime at a time - that way he'll never notice until the change jar is virtually empty, and then it's too late.

The same thing is going on with our economy and corporate structure today. In all sectors and markets - they are robbing our nation BLIND, but they are doing it to us a little at a time, and the general public collectively thinks everything is just peachy-keen.

$19 for a music CD?!?! :no::irk:
I can buy 100 CD-RW's for $19 retail for heaven's sake!, so it sure isn't due to material costs.

$28k for the same exact car that costs someone else $19.5k... retail?!?! :no::mad:
That $28k figure represents a (19500/28000 =) 69% margin above a RETAIL price for heaven's sake!!!

Convince me now just how "lean" these carmakers and dealers are pricing their stuff and what good deals we are getting.
And convince me how expensive cars are to actually make too while you're at it. :irk:

I'm all ears...:cool:

centric

05-06-2003, 10:50 AM

I think one of the central problems comes down to complexity. If the automakers produced a product, set a SINGLE retail price, and a SINGLE wholesale price, then they would not have:

1. The cost of administering the various pricing programs in whatever countries they sell in.
2. The cost of administering any rebates and incentives.
3. The cost of 0% financing and any other "hidden" incentives.

Instead, we have this complex panorama of incentives to the consumer and dealer, invoice price, holdbacks, kickbacks, shared marketing costs, periodic "clear out the inventory" discounts, ad infinitum, ad nauseum. What does this support? A huge army of middle-management bureaucracy that adds no value to the vehicle whatsoever.

"But that's how cars are sold these days," you whine. "People NEED to think they're getting a good deal!"

Let's see, so you sell a car worth $19,000 for $25,000, and have a $3000 rebate, which brings it down to $22,000 and spend the remaining $3K above its actual value on administering all these various programs. Then you argue that $25K is what everyone else is charging, so it's OK.

Why not just sell it for $19K and TAKE THE MARKET?

mcmb

05-06-2003, 11:04 AM

Originally posted by ProudPony
Well, you said it, not me. Isn't this GREED? I agree, big people in big places with big money are the ones that make things like that happen, yet if you knew the WHOLE truth, you'd probobly be suprised to know that the big plant is actually getting to write-in the full cost-to-produce against their product's price-as-charged to their customers, who are probably 3 states away. So their customers are providing them large margins on products that really were "discounted" to the plant due to the local incentives you mentioned... Taxpayers foot the direct bill for the tax-breaks and utility charges, AND the consuming public gets to pay the same elevated prices for the plant's end product ANYWAY.
That's double-dipping the working stiff if you ask me, and it's WRONG.

I know the same thing happened in SC when BMW moved into Spartanburg, because the tax-package is what helped SC win the site over NC's bid. That fact not withstanding, BMW, Honda, Toyota, and others are STILL proving themselves more profitable than domestic car compnies WITH American labor and sub-contractors. And I know that a Ford or GM plant would get the same fight for tax-advantages that a Hyundai plant would here. :rolleyes:

The problem here is that the AMERICAN workers at BMW, Honda, Toyota, etc. are non-union workers and they are just as happy working there as flipping burgers at McDonalds. (Maybe a bit happier there since they get paid better, but that's only because those companies have to compete somewhat with the union shops in order to get people to stay once they have some training.)

Originally posted by ProudPony
I don't get it? Do you want to know what I make or how much I could stand to lose and get by? I am not a union member - nor will I be. I am self-motivated and I WANT to fend and fight for my own stake and earnings. I want to do as I see fit for my interest and the interest of my employer - without being regulated or charged for my own self-management. If I don't like my job or anything about it, I'm not going to gripe to my union rep - I'll quit and do something else. After all, this is America - the land of opportunity! (or at least for a few more years i hope :( )

What I want to know is how you think you have any job security when by your own arguments you put out the premise that your company should be looking at the most cost-effective labor. Either you don't get paid anywhere near what you are worth (thereby feeling you ARE the most cost-effective option), or you feel that this cost-effective labor initiative will stop at your job level. (Believe me, it MAY NOT stop until your whole plant is in another country!!)

Originally posted by ProudPony
Don't give up just to give in, dude! Look, if nobody buys a $50k CTSv, then GM will learn that it is futile to make such a car and put such a price on it. Likewise, if you stop buying $18 music CD's, the dealers WILL drop their price or they'll go out of business, and the star singers won't be signing $10-million record deals either. If you stop paying $65 for a seat at a ball game or NASCAR race, the price WILL drop, or the places will go broke. Ball players will stop getting $30-million/3-year deals, and NASCAR races will stop paying out $8-million winnings at every race. THESE are the things we can do to impact things where they matter. It's not like we need to stop buying a gallon of milk to spite the grocery store - but we end up killing the farmer instead - that would be silly and futile. And I don't want to be stupid with my actions at all, I want to send a clear and concise message about how I value my earned money.

Some people WANT a $50k car. Some people want a $2k beater to drive every day. Just because a singer, athlete, etc. makes a lot of money doesn't make it Anti-American. If you stop paying $65 a seat at a ballgame the only thing it will accomplish is making more room for the people who do pay $65 to park their $50k cars!! (That's ok, at those prices they probably feel better if no one is parked next to them anyway.) And if you stop paying $18 for a music CD the only thing it will do is put the poor counter-guy at Tower-Records out of a job. (Because if you start buying at DISC-GO-ROUND the second-hand CD store it's probable the owner is the only employee.)

Not to be inflamatory or anything, but looking through a few of PROUDPONY's posts it seems to me that he has some issues with the fact that while he went to school, got training, does his best to come up with helpful ideas for his company, etc., the fresh-out-of- high-school kid (Billy-Bob) out on the shop floor is still making 3/4 as much as he is. He should be doing a LOT better than Billy-Bob! Well it just don't work that way!! Sure, Billy-Bob just sits and stares at his machine for 8 hours and then goes home, but--1. The company must think he knows what he is staring at or they wouldn't be paying him. 2. He's there every day staring at it. If you go down a level or two in the job market you will find a LOT of people who can't seem to manage to be there EVERY day!! 3. Maybe Billy-Bob got lucky and landed him a good job. So what? If he doesn't contribute more than his 8 hours he will be one of the first to go anyway. In the meantime, if Billy-Bob, and Norma-Jean don't show up every day PROUDPONY is soon not going to have a job to do. 4. If PROUDPONY's company replaced Billy-Bob, and Norma-Jean with lower paid labor, (they would have to replace them since now that they have tasted $$ they won't take a pay-cut) perhaps PROUDPONY would have too much to do. (Since B-B and N-J at least know enough about the machines they are staring at to not screw them up too much!) ---Of course then maybe PROUDPONY gets pissed because he has too much to do now, he quits, (because he was never paid enough anyway) and the guy whose job went to Mexico can just step right in!!! INTERESTING.

One shouldn't complain just because the guy next door is making a living, or (God forbid) maybe even making more than oneself. If you want to live in a penthouse, be a CEO. If you want free burgers, work at McDonalds. If you are too good for one, but not good enough for the other, find your niche and be happy.

Besides, if PROUDPONY wanted to be a millionaire, why did he take engineering, instead of getting a nice, overpaid, medical degree???? It's the AMERICAN WAY!!!!!!!!!!!!!!!!!!!!!

mcmb

05-06-2003, 11:26 AM

Originally posted by ProudPony
OK - Is there anybody in this forum/thread that doesn't think we're gettin' gouged by the automakers?

Anybody...

If so, please speak up now before this gets REAL ugly...

ANYBODY who doesn't beleive that we (the American car buyer) are not victims of a conspiracy, by the carmakers and their dealers, to maintain car prices as high as possible in our "wealthy" nation... READ THIS.

Same cars can cost oodles less in Canada (http://story.news.yahoo.com/news?tmpl=story&u=/usatoday/20030506/bs_usatoday/5131610) from Yahoo Neswire - dated today.

"Odds are that new car you bought in the USA is being sold for less money -- maybe thousands less -- in Canada. "

"...automakers have attempted to crack down on sellers and buyers. In turn, the automakers have been sued on behalf of buyers. If the automakers can't stop the import numbers from growing, they face yet another erosion of profit..."
Who are they (automakers) to crack down on THE BUYER for getting a good deal!!! I praise the dealer willing to sell a vehicle for a modest profit instead of a king's ransom! The factory obviously got what they wanted for the car, or it would have not been delivered, or better yet reported stolen.

"Automakers call the price differential ''pricing to the market.'' They say they price cars lower in Canada -- anywhere from 1% to 40% -- because wages and economic conditions are below those in the USA, and taxes are higher. It's what the market will bear, they say."
Ahhh yes, "WHAT THE MARKET WILL BEAR". Have you guys heard me say that anywhere else in this thread? Now you've heard it from THEM too.

"But some U.S. dealers, brokers and buyers say it's price gouging. ''It's not right,'' says Dave Pierce, a Great Falls, Mont., new car dealer"
Yeah, no sh1+ Sherlock. That's what I've said for years - welcome to the 20th century... :rolleyes:
My problem with him is that he's mad because he can't gouge the public because of where he lives, and he's crying about it. :mad:

"a new loaded Dodge Caravan that costs me $28,000 from the factory, I could get delivered to my door from Canada for $19,500."
Oh Noooo, nothing wrong with this picture. Heck, it's probably got something to do with "knowing the right person", or getting the guy in a "dealing mood", huh? :irk:

Dammit guys, if y'all can't see what's going on in front of us after reading this whole thread and especially this article, WE'RE DOOMED.

The best way to rob your granddad blind is to take a quarter or dime at a time - that way he'll never notice until the change jar is virtually empty, and then it's too late.

The same thing is going on with our economy and corporate structure today. In all sectors and markets - they are robbing our nation BLIND, but they are doing it to us a little at a time, and the general public collectively thinks everything is just peachy-keen.

$19 for a music CD?!?! :no::irk:
I can buy 100 CD-RW's for $19 retail for heaven's sake!, so it sure isn't due to material costs.

$28k for the same exact car that costs someone else $19.5k... retail?!?! :no::mad:
That $28k figure represents a (19500/28000 =) 69% margin above a RETAIL price for heaven's sake!!!

Convince me now just how "lean" these carmakers and dealers are pricing their stuff and what good deals we are getting.
And convince me how expensive cars are to actually make too while you're at it. :irk:

I'm all ears...:cool:

If so, go to CANADA, buy the car for $19000, and then come back and post to all of us how much tax you paid. I think we could all use the lesson in perspective. (Or, why does the guy in Tennesee go to Illinois to buy stuff?? 8.5% sales tax is why!!---Also the reason retail prices are slightly cheaper in Tenn.) Taking a look at ALL your posts PROUDPONY it seems to me you are trying to make us a third-world economy in order to have lower prices. Sure the companies price things to meet the market, it's called CAPITALISM!!!

centric

05-06-2003, 01:27 PM

I don't think any of us here have a problem with fair market competition and capitalism . . . I think the real problem is that competition has become wink-wink, nudge-nudge "competition" with prices fixed by some very large players and rules that are so complex that nobody wins.

If you want to take market share, come up with something that upsets the value equation! That's how a REAL market works.

ProudPony

05-06-2003, 02:27 PM

Originally posted by mcmb
The problem here is that the AMERICAN workers at BMW, Honda, Toyota, etc. are non-union workers and they are just as happy working there as flipping burgers at McDonalds. (Maybe a bit happier there since they get paid better, but that's only because those companies have to compete somewhat with the union shops in order to get people to stay once they have some training.)
Do you really beleive that? The local BMW plant accepts applications, processes the person, applies the appropriate tests and skill examinations, scores the individual, and then places them on a waiting list for jobs in which they are best suited. They call the individual if/when an opening occurrs. The list is about 2.5 years out last I heard. Doesn't sound to me like they are struggling to keep people employed for their "wage offerings".

What I want to know is how you think you have any job security when by your own arguments you put out the premise that your company should be looking at the most cost-effective labor. Either you don't get paid anywhere near what you are worth (thereby feeling you ARE the most cost-effective option), or you feel that this cost-effective labor initiative will stop at your job level. (Believe me, it MAY NOT stop until your whole plant is in another country!!)
My company is actually VERY active in local sourcing. We have entered into some partnerships overseas to at least maintain a 50% stake in the business that we would have otherwise lost all together. But I am actively involved in getting work into local shops, creating local plants, and using local retailers. We CAN and DO make it work here. That's one of the reasons why I am so happy to have my job - it's one of the few remaining that offer some patriotic satisfaction. I have been through the layoffs and takeovers twice. I know I am disposeable at my company. But I also know that they recognize that I can make them great deals of money, and I think they would weigh that before axing me over Billy-Bob.

As for feeling like I'm not paid what I'm worth - that's a poor assumption on your part. I am happy with what I make, or I'd leave and do something else. I was simply pointing out that I have no guilty conscience about taking home what pay I do - because I am "giving back more than I'm taking". I like to think that my contributions are helping my fellow American workers KEEP their jobs, and make their jobs more pleasurable to bear as well.

I get the feeling that you resent your job in some way, and feel that everyone else must too. I don't - I actually enjoy it - that's why I do it.

Some people WANT a $50k car. Some people want a $2k beater to drive every day. Just because a singer, athlete, etc. makes a lot of money doesn't make it Anti-American. If you stop paying $65 a seat at a ballgame the only thing it will accomplish is making more room for the people who do pay $65 to park their $50k cars!! (That's ok, at those prices they probably feel better if no one is parked next to them anyway.) And if you stop paying $18 for a music CD the only thing it will do is put the poor counter-guy at Tower-Records out of a job. (Because if you start buying at DISC-GO-ROUND the second-hand CD store it's probable the owner is the only employee.)
You've missed my point alltogether. If we COLLECTIVELY stop paying for the $65 seats - the price WILL drop! I didn't say that someone else would just step in and pay it - that is what is happening right now. It's fuel on the fire.

If you want to spend a days' wages on a 2-hour evening for you and the wife/ g/f at the stadium and have nothing to show for it - that's YOUR perogative. I've decided to spend my get-away time at the beach, fishing, or hunting with my family. The cost is less, the time is more appreciated, and I'm not helping to make some multi-millionaires even wealthier with my hard-earned cash. Let the wealthy swap money with the wealthy - I'll keep my money for other uses. That's MY perrogative.

I'd rather support the modest, hard working guy at DISC-GO-ROUND anyways - KUDOS to him for working his arse off trying to grow his own business. If his business grows due to Tower-Records going under, he can hire the kid from Tower Records and tech the kid how honest and fair business practices helped him to prevail.:D
You see, I'm creative too!

Not to be inflamatory or anything, but looking through a few of PROUDPONY's posts it seems to me that he has some issues with the fact that while he went to school, got training, does his best to come up with helpful ideas for his company, etc., the fresh-out-of- high-school kid (Billy-Bob) out on the shop floor is still making 3/4 as much as he is. He should be doing a LOT better than Billy-Bob! Well it just don't work that way!!
You don't need to refer to me in third party pal - I'm gonna read the post anyways. :)

And yes, you are exactly right. I feel people shold EARN what they get, not fall into it or have it handed to them via some union process or favor-cashing. I don't know of any Billy-Bobs in my current company, but they are RAMPANT in our customers' shops. Ford, GM, and others are notoriously riddled with Billy-Bobs.

"Well it just don't work that way!!"
No Ch1+! That's why I am advocating fair play and fair trade in this thread! Why do people have to be so scerewed up?
centric made a great point with his analysis above...
"Let's see, so you sell a car worth $19,000 for $25,000, and have a $3000 rebate, which brings it down to $22,000 and spend the remaining $3K above its actual value on administering all these various programs. Then you argue that $25K is what everyone else is charging, so it's OK. Why not just sell it for $19K and TAKE THE MARKET?"
EXACTLY!!!
Why isn't Billy-Bob paid what he's WORTH, as opposed to what his union contract demands... goofy.:shame:

Sure, Billy-Bob just sits and stares at his machine for 8 hours and then goes home, but--1. The company must think he knows what he is staring at or they wouldn't be paying him. They can't fire him, or they'll have to pay his salary anyways and pay a penalty to his union 2. He's there every day staring at it. If you go down a level or two in the job market you will find a LOT of people who can't seem to manage to be there EVERY day!! Then fire those sorry bastards too. Do the work or hit the road.3. Maybe Billy-Bob got lucky and landed him a good job. So what? If he doesn't contribute more than his 8 hours he will be one of the first to go anyway.How so? In the meantime, if Billy-Bob, and Norma-Jean don't show up every day PROUDPONY is soon not going to have a job to do. Oh yes I will, I'll bbe designing a fully automated system with vision control integrated to replace their sorry cans! I have MOTIVATION, dude, I'll find a way.4. If PROUDPONY's company replaced Billy-Bob, and Norma-Jean with lower paid labor, (they would have to replace them since now that they have tasted $$ they won't take a pay-cut) perhaps PROUDPONY would have too much to do. That's the assumed position anyways. I will always have too much to do, because I never stop trying to improve or create a "better way". B-B or N-J would only speed up the attention I give their areas of work by being sorry at it.(Since B-B and N-J at least know enough about the machines they are staring at to not screw them up too much!) ---Of course then maybe PROUDPONY gets pissed because he has too much to do now, he quits, (because he was never paid enough anyway) and the guy whose job went to Mexico can just step right in!!! INTERESTING. If I quit, the guy from Mexico better look out, because I will then be self-employed, marketing a new system that is far more technologically advanced and cost effective that the one he is about to take over. BTW, the reason I quit was because my employer wasn't smart enough to fund the project I just thought up for them! :D Hehe!

One shouldn't complain just because the guy next door is making a living, or (God forbid) maybe even making more than oneself. If you want to live in a penthouse, be a CEO. If you want free burgers, work at McDonalds. If you are too good for one, but not good enough for the other, find your niche and be happy.
Problem is the guy next door is in China, Taiwan, Malaysia, Singapore, etc. He's not your neighbor anymore. In case you haven't noticed, unemployment is at an all-time high since the great depression of the '30's. I don't belittle anybody making a ot of money - as long as they do it honorably and fairly.

Besides, if PROUDPONY wanted to be a millionaire, why did he take engineering, instead of getting a nice, overpaid, medical degree???? It's the AMERICAN WAY!!!!!!!!!!!!!!!!!!!!! [/B]
How do you know I'm not a millionaire? I DO more than work for a company 9 hours a day...;)
You should do what you enjoy doing - making money at it will come if you do it well.
BTW, there are many MD's out here who are far from wealthy and commit themselves to work volunteer jobs in poor neighborhoods and free clinics - my kind of guys/gals, giving back to the bigger picture. KUDOS to them.

Thanks for the spirited debate pal. I really do appreciate the thought you put forth. It means you are at least thinking about the issues, good or bad, which is more than many people can admit to. :bow:

mcmb

05-08-2003, 11:14 AM

Originally posted by ProudPony
Do you really beleive that? The local BMW plant accepts applications, processes the person, applies the appropriate tests and skill examinations, scores the individual, and then places them on a waiting list for jobs in which they are best suited. They call the individual if/when an opening occurrs. The list is about 2.5 years out last I heard. Doesn't sound to me like they are struggling to keep people employed for their "wage offerings".

I think that varies some depending on the local job market. We have a John-Deere plant near-by that works along those lines. Their biggest problem is when they get around to calling people the people are not interested anymore. (You have to be there for a number of years to have a "decent" job, until then you are a "labor pool" worker.)

Originally posted by ProudPony
My company is actually VERY active in local sourcing. We have entered into some partnerships overseas to at least maintain a 50% stake in the business that we would have otherwise lost all together. But I am actively involved in getting work into local shops, creating local plants, and using local retailers. We CAN and DO make it work here. That's one of the reasons why I am so happy to have my job - it's one of the few remaining that offer some patriotic satisfaction. I have been through the layoffs and takeovers twice. I know I am disposeable at my company. But I also know that they recognize that I can make them great deals of money, and I think they would weigh that before axing me over Billy-Bob.

I didn't say they would axe you over B-B. I said that in the process of developing a "cost-effective" workforce, they MAY axe EVERYBODY and ship production elsewhere.---I'm not sure I understand how you can say in the same paragraph that "We have entered into some partnerships OVERSEAS to at least maintain a 50% stake in the business that we would have otherwise LOST ALL TOGETHER.--And then say things like,---We CAN and DO make it work here.--And---That's one of the reasons why I am so happy to have my job - it's one of the few remaining that offer some patriotic satisfaction.---Perhaps the process of "cost-effectivness" is already started at your company???

Originally posted by ProudPony
I get the feeling that you resent your job in some way, and feel that everyone else must too. I don't - I actually enjoy it - that's why I do it.

No, actually I'm quite happy with my position. I'm just not so fond of what is happening to (and will happen to) good people who make an honest, good faith, effort to support their employer, and are then treated with extreme disregard when the company is forced to move. (Believe me, out of 650 people, who ALL believe they will get what's entitled to them, maybe 50 will leave with FULL benefits (pension, severance, etc.) the rest are to be "bought off" for a fraction of whats due. After all, with no job they will except whats offered.)

Originally posted by ProudPony
You've missed my point alltogether. If we COLLECTIVELY stop paying for the $65 seats - the price WILL drop! I didn't say that someone else would just step in and pay it - that is what is happening right now. It's fuel on the fire.

You miss MY point. We ARE NOT going to collectively stop paying for what we want. No way--No how--Ain't gonna happen!!!

Originally posted by ProudPony
If you want to spend a days' wages on a 2-hour evening for you and the wife/ g/f at the stadium and have nothing to show for it - that's YOUR perogative. I've decided to spend my get-away time at the beach, fishing, or hunting with my family. The cost is less, the time is more appreciated, and I'm not helping to make some multi-millionaires even wealthier with my hard-earned cash. Let the wealthy swap money with the wealthy - I'll keep my money for other uses. That's MY perrogative.

Perhaps here is the problem. IF your two hour evening costs you a days pay, then most likely you will resent the price. Perhaps, it would be more enjoyable to get the wife/gf/whatever, grab some brews and chews, and watch a game at home on T.V.? (But don't watch the commercials, those people will try to screw you out of your hard earned cash!!)

Originally posted by ProudPony
Problem is the guy next door is in China, Taiwan, Malaysia, Singapore, etc. He's not your neighbor anymore. In case you haven't noticed, unemployment is at an all-time high since the great depression of the '30's. I don't belittle anybody making a ot of money - as long as they do it honorably and fairly.

Sure the guy in China, etc. is making money too. And I don't think it is fair to throw everybody who has a buck together and imply that they didn't make it "honorably and fairly". But, is it possible you are not really sure about your neighbor? Lots of people in this country are making money. (Or at least they were until the market screwed up!) Also, as of today, the unemployment rate is aprox. 6.5% nationwide, that's FAR below the 11% to 14% it was at times during the 70's. (I was there, I remember.)

To end, I originally started these posts to comment on why the big three can charge $50k for a car. The reason is that there are, (and always will be ) people who will pay that price for what they deem is a quality product. Now granted, a $50k car is NOT meant for everybody, but I believe the people it is meant for are not complaining about the price. (Although there are a number of people who want to believe it is meant for them, and they WILL complain, not so much because of the price, but because they are either unable, or unwilling to afford one.) In short, using a different example, if a concert costs $150 a seat and you only make $150 a day at your job, you either go and enjoy an experience you will have to remember, OR you don't go, use you money elsewhere, and except that it is your choice. You DON'T complain that the price is to high because of some conspiracy to jack up the costs of everything in this country so that the "fat-cats" can get rich at the poor peoples expense. That's not reality, reality is that not EVERYTHING is meant for, or priced for, EVERYBODY. If YOU were the singer at this concert would you feel the price is due to your talents? Or, due to some conspiracy? In the end we generally get what we work for. Some people work harder than others and get more, they don't generally get more because it was handed to them, or because they ripped off the public.

My thanks to PROUDPONY for making this an enjoyable debate. This country does need EVERYBODY'S two cents! (And, if not the country, at least the "fat-cats" want your two-cents!!!!!!!!)

guionM

05-08-2003, 02:12 PM

This is one of the most interesting threads I have ever read. :D

The problem isn't the price of the car itself. People are buying these cars, so they can most certainly afford them. Also, the price of cars overall hasn't risen that much since the 1950s. Sure, there was that $4,000 loaded GTO in 1969, but would you want to get paid what your job paid in 1969? Didn't think so.

The problem is that companies as a rule look for ways to maximize profits. Over the past 30 years, the favored way has been to reduce the workforce it has. Machines & Robots don't need medical, dental, off days, labor agreements, breaks, or any of those pesky things real people need. The excess savings went straight into management pockets. When you compare the average wage on the shop floor to the wage of the top earners in the company, the gap increase is simply astonishing! The percentage between the 2 is insane!

Labor leadership isn't free from blame either. Labor leadership is needed to keep management from screwing over it's employees (which they will do given the chance). How many times in the past decade has management demanded labor to take a pay cut, or a medical coverage cut, or a pension cut, but yet just months later, management recieves massive bonuses!

Where labor leadership has failed is that where there isn't any issues at negotiating time, it's just like politics, do something you can show to get reelected. If a person is assigned to inspecting brake lines is underemployed a particular day, why can't he be asked to inspect engine accesories if there's a back up of work there? Why can't a person's wage be tied to the number of areas he's trained to work in, creating incentive to become more knowledgeable in the plant, and at the same time having more of an emotional stake (or pride) in the plant he works at?

As for the paint booth guy making almost as much as the engineer, my view is so what? As long as he's execellent at his job, and that's the going rate, I say more power to him. He's not the reason why you are paying as much as you do for a new car. And with everyone and their brother going to college, it's in the trades which require apprenticeships where the shortage is, and in some instances that work shortage is going to result in a high school graduate (or dropout) to make more, and sometimes way, way more than you (wage earners work 40 hours, and anything more is overtime, while salary earners make the same amount whether you work 40, 50, 80 hours or more!).

There's enough blame to go around. GM's CEO makes $1.4 million per year, along with stock options, expenses, and a whole list of perks, basically meaning his salary goes straight to his account. But he's no where near the top in salary!! How about Nick Scheele (who isn't even the top guy at Ford) clearing $10.2 m-i-l-l-i-o-n in 2002, PLUS another $8 million in options! In fact, all top Ford executives get paid more the the head guy at GM. Even Dubya get's paid only $400,000 per year, and he came in under a pay raise!

(Adjusted for inflation, the president's salary in 1969, $200,000...perhaps the most money paid a president in real terms...equals $900,000 today!)

Compare this to America's highest paid business executive in 1969 (GM Chairman James M. Roche) at $795,000 while his average worker earned $5,602. By that difference, if the highest paid executive in the US is making $11 millon per year (a very low figure mind you), then his average worker should be making roughly $80,000 per year without overtime, which of course, ain't happening!!

So, the problem with your car's coast isn't union pay or benefits. I think that rates behind pay & bonuses to executives & the quest to show more bottom line cash for ever demanding stockholders.

http://media.gm.com/news/releases/020419_stock.html
http://www.forbes.com/2003/04/28/0428facesam.html
http://www.businessweek.com/1999/99_16/b3625017.htm

ProudPony

05-08-2003, 04:12 PM

Originally posted by mcmb
I'm not sure I understand how you can say in the same paragraph that "We have entered into some partnerships OVERSEAS to at least maintain a 50% stake in the business that we would have otherwise LOST ALL TOGETHER.--And then say things like,---We CAN and DO make it work here.--And---That's one of the reasons why I am so happy to have my job - it's one of the few remaining that offer some patriotic satisfaction.---Perhaps the process of "cost-effectivness" is already started at your company???
The process of finding cheap labor started long ago in fact.
As for me making my comment about a partnership... We had a very large customer taking orders from NC for years, but they made a commitment to be a local supplier for a larger company that was moving to Asia. The choice was simple - "either make the product local to us, or we'll find somebody else". You don't give up 40% of your plant's dedicated business without a fight. We did not/do not want to have our own operations in Asia, so we created a partnership with the customer, and went in 50/50. Our technology and capital - their labor, land, and management. 50/50 on the sales too. We "engineers" then concentrated on converting our NC plant's capacity to other products that showed growth and promise here domestically. Nobody in our NC plant lost a job (out of 1400) even though 40% of the orders went to Asia in one fell swoop - I think that's pretty damn astounding in today's climate.

Originally posted by mcmb
No, actually I'm quite happy with my position. I'm just not so fond of what is happening to (and will happen to) good people who make an honest, good faith, effort to support their employer, and are then treated with extreme disregard when the company is forced to move. (Believe me, out of 650 people, who ALL believe they will get what's entitled to them, maybe 50 will leave with FULL benefits (pension, severance, etc.) the rest are to be "bought off" for a fraction of whats due. After all, with no job they will except whats offered.)
Oh dude - we AGREE on this... don't get me wrong!!!
I'm in TOTAL agrement with you here.
I saw one of my machine builders get let go after 32 years service - not in the same company, but the same DEPARTMENT!!! He was making @$22/hr. He missed early retirement by less than 6 weeks. He also got 2-weeks pay for every year of service, and that was all. I was LIVID over losing him - he knew ALL the machines in the plant and was a valuable resource to me, as well as my golf buddy, lunch buddy, and a friend. We had no union there. He was screwed.

But let's be honest with ourselves - WHO MADE THE CALL TO CAN THIS GUY? It sure wasn't his supervisor - that was ME! It was our plant manager, and he told me he was directed to cut 54 people out of the labor force - by our Director. And the directors (later) discussed how to trim costs in one of their quarterly meetings with the board and CEO/CFO. Funny how the guys making the big decisions can do that sort of thing, huh?

All I'm saying in addition to your point is that unions have shot themselves in the foot on occasion too. There is plenty of blame to go around. The CEO's and Directors are the largest chunk of the problem IMO, because they are making every decision based on ONE result - PROFITS - instead of good "business sense" decisions that might offer a brighter future but reduce todays profits.

Originally posted by mcmb
You miss MY point. We ARE NOT going to collectively stop paying for what we want. No way--No how--Ain't gonna happen!!!
And my new goal in life is to be one step in front of people with this attitude at every juncture, selling them $5-bills for $10/each too. "Ahhh yes my darling, there's a sucker born every minute."

Originally posted by mcmb
Perhaps here is the problem. IF your two hour evening costs you a days pay, then most likely you will resent the price. Perhaps, it would be more enjoyable to get the wife/gf/whatever, grab some brews and chews, and watch a game at home on T.V.? (But don't watch the commercials, those people will try to screw you out of your hard earned cash!!)
If you go to the Winston race next weekend - I GUARANTEE you will spend more than a day's take-home wages after parking, admission, concessions, etc. (much less a T-shirt or couple koozies). And it got you a thrill between 8:00 and 11:00. It also made many millionaire owners, drivers, and track owners MUCH more wealthy for their time as well. When it was $15-25 bucks/seat and $2-parking, I was there a bunch. Now it's more like $80/seat, $10/park, and $4/beers - SCREW THAT!

And you are correct again regarding the wife and kid at home. That IS our favorite activity - being together, enjoying each others' company, and keeping our money for better uses.

LOL at your commercial crack too. Count the # of 0% commercials you see between 8 and 9pm!!!

Originally posted by mcmb
Sure the guy in China, etc. is making money too. And I don't think it is fair to throw everybody who has a buck together and imply that they didn't make it "honorably and fairly". But, is it possible you are not really sure about your neighbor? Lots of people in this country are making money. (Or at least they were until the market screwed up!) Also, as of today, the unemployment rate is aprox. 6.5% nationwide, that's FAR below the 11% to 14% it was at times during the 70's. (I was there, I remember.)
Alot of people were high in the 70's and have clouded memories too!:D
Unemployment rates from 1920-2002 are linked [/B][/QUOTE] HERE (http://www.infoplease.com/ipa/A0104719.html) , given in every other year.
1970 4.9%
1972 5.6%
1974 5.6%
1976 7.7%
1978 6.1%
1980 7.1%
Not quite 14%. Unless you want to concede that the current 6% is wrong too - which it is - because when a person's unemployment benefits expire (various periods between 6-18 months), they fall off the "unemployed list" whather they found a job or not. Unemployment also doesn't include those in school due to job loss, or those working part time as crossing guards or burger flippers since they can't get a real 40-hour career job.

THIS (http://www.bls.gov/news.release/empsit.nr0.htm) link to the Department of Labor reports 6% as of last Friday. It also points out the fallacies I noted above, and includes such text as ...
"In April, 4.8 million persons were working part time even though they would have preferred a full-time schedule. The number of such workers increased by about 600,000 over the year."

"In April, 1.4 million persons were marginally attached to the labor force, the same as a year earlier. These individuals wanted and were available to work and had looked for a job sometime in the prior 12 months. They were not counted as unemployed, however, because they did not actively search for work in the 4 weeks preceding the survey.."

"Manufacturing job losses totaled 95,000 in April, more than twice the average monthly decline for the prior 12 months (-40,000)."

Originally posted by mcmb
To end, I originally started these posts to comment on why the big three can charge $50k for a car. The reason is that there are, (and always will be ) people who will pay that price for what they deem is a quality product. Now granted, a $50k car is NOT meant for everybody, but I believe the people it is meant for are not complaining about the price. (Although there are a number of people who want to believe it is meant for them, and they WILL complain, not so much because of the price, but because they are either unable, or unwilling to afford one.)
My problem is not that a car is made to accomodate the rich, my problem is when Corporate America thinks EVERYBODY is rich!

My main problem is the American attitude - we are fat, wealthy slobs who are living today on the merits and benefits of our ancestors' hard work, good morals, and determination to do what was right for the previous 150 years. Go back to 1945 and drive your BMW down Main St - USA... or flip on your Sanyo receiver to listen to WAR news. Find something here made n China in 1972...
Instead of "settling" for what we have now, we could be the economic superpower of the world. Instead, we throw out more food than most people are lucky enough to get in some countries, we burn gas like it's water, we kill trees by the millions to make paper and cardboard we throw in the landfill, etc. We, as a society, are SLOBS - big fat wasteful SLOBS, totally comfortable with WASTING ANYTHING, from food to money. And we are so oblivious to what is happening because we have been so strong for so long, we are being reduced to commonality with the rest of the world AND WE DON'T EVEN KNOW IT OR CARE.

THAT'S why I'm posting in this thread.
You see, it's not whether or not you can afford it... It's why it even costs that much in the first place.

My thanks to PROUDPONY for making this an enjoyable debate. This country does need EVERYBODY'S two cents! (And, if not the country, at least the "fat-cats" want your two-cents!!!!!!!!)
I reciprocate - you have been an amicable and very worthy debating partner. :bow: I've enjoyed it too!:cool:

mcmb

05-08-2003, 09:05 PM

Just a couple of quick facts, unemployment rates for various years according to U.S. Department of Labor, Bureau of Labor Statistics.

Year Ann Avg
1939 17.2
1940 14.6
1941 9.9
1942 4.7
1943 1.9
1944 1.2
1945 1.9
1946 3.9
1947 3.9
1948 3.8
1949 5.9
1950 5.3
1951 3.3
1952 3.0
1953 2.9
1954 5.5
1955 4.4
1956 4.1
1957 4.3
1958 6.8
1959 5.5
1960 5.5
1961 6.7
1962 5.5
1963 5.7
1964 5.2
1965 4.5
1966 3.8
1967 3.8
1968 3.6
1969 3.5
1970 4.9
1971 5.9
1972 5.6
1973 4.9
1974 5.6
1975 8.5
1976 7.7
1977 7.1
1978 6.1
1979 5.8
1980 7.1
1981 7.6
1982 9.7
1983 9.6
1984 7.5
1985 7.2
1986 7.0
1987 6.2
1988 5.5
1989 5.3
1990 5.6
1991 6.8
1992 7.5
1993 6.9
1994 6.1
1995 5.6
1996 5.4
1997 4.9
1998 4.5
1999 4.2
2000 4.0
2001 4.7
2002 5.8

And while my 6.5% was slightly off, (Unemployment is 6.0% as of April 2003) AND my 1970's rates were more a product of memory than research, (Remember kids, ALWAYS do your HOMEWORK!!) PROUDPONY is incorrect in stating "unemployment is at an all time high since the Great Depression in the 1930's" or whatever. While rates in the 1930's were far higher than today, rates in the mid 70's to mid 80's were also higher. (So therefore, the rates are not higher than the 30's YET!!) THANKS, Gotta Run!!!!!

ProudPony

05-09-2003, 08:30 AM

Originally posted by mcmb
And while my 6.5% was slightly off, (Unemployment is 6.0% as of April 2003) AND my 1970's rates were more a product of memory than research, (Remember kids, ALWAYS do your HOMEWORK!!) PROUDPONY is incorrect in stating "unemployment is at an all time high since the Great Depression in the 1930's" or whatever. While rates in the 1930's were far higher than today, rates in the mid 70's to mid 80's were also higher. (So therefore, the rates are not higher than the 30's YET!!) THANKS, Gotta Run!!!!!
HEY - you posted my link! J/K! ;)
(I didn't want to post every year, just the 70's.)

So did you understand my point about the change in how unemployment is calculated? We didn't have unemployment benefits in the 30's like we do today, nor in the '70's for that matter. And CERTAINLY, you didn't get dropped off the "list" of unemployed back then just because you had expired your term for the unemployment benefits package. Simple fact is, if you don't have a job, your UNEMPLOYED. I don't care if you are drawing unemployment or not. That's a goofy technicality that politicians and beaurocracies can utilize to make things appear better than they really are.:rolleyes:
NBC News did a great piece on just this subject last Friday night. I'd love to find a write-up on that segment Brian Williams did.

When you have 4.8 million people working part time because hey can't find a full-time job - YOU HAVE A PROBLEM.
When you have 1.4 million people marginally attached to the labor force but not fully employed - YOU HAVE A PROBLEM.
When you have 95,000 people in manufacturing alone LOSING their job in a single MONTH - You HAVE A PROBLEM.
"Employment in amusement and recreation services and in hotels decreased by 41,000 and 20,000, respectively."
"Total nonfarm payroll employment edged down by 48,000 in April to 130.3 million, seasonally adjusted. This followed 2 months of job losses totaling 477,000..."

And to pile on to the issue of unjustified wage that Billy-Bob was earning while he was sitting on his keester watching a machine do the actual work - as of last Friday...
"...average workweek for production or nonsupervisory workers on private nonfarm payrolls declined by 0.3 hour in April to 34.0 hours..."]/i] (That's 6 hrs short of 40 hrs/week there bud.)
"Average hourly earnings of production or nonsupervisory workers on private nonfarm payrolls increased by 2 cents in April to $15.11."
"Reflecting the decline in weekly hours, average
weekly earnings decreased by 0.7 percent to $513.74/week."

All data taken from my original link - The US Department of Labor - Bureau of Labor and Statisticsfound HERE (http://www.bls.gov/news.release/empsit.nr0.htm).

That's right fellas - $500/week is the average working guys EARNINGS - not take home, not net. Take 30% out of that for taxes and the average Joe American is bringing home [i]$350/week!!!
Now if ANYBODY wants to try to justify to me why Billy-Bob should get $50k/year ($960/week) when Joe American is earning $26,715 ($500/week) doing manual labor and adding value to his product - knock yourself out. I will content that Joe American's eyes are 20/20 just like B-B's, his hands have 10-fingers, his IQ is comparable, they are both healthy, capable guys, and Joe's arse will hold down a stool just as good as Billy-Bob's arse will - maybe better - and for 1/2 the price.

It's all good mcmb - I have actually developed a good bit of respect for you throughout our conversation. At least you seem passionate about the subject - regardless of our different views on certain areas - and that's more than can be said for most people. :bow: