The U.S. Auto Industry Feeding Trough is Closed

...all of the blah-blah about auto industry labor and management being on the same team turned out to be true...with both sides showing equal disregard for the stockholders and the U.S. as a whole...

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By Bob Gordon
Co-publisher
The Auto Channel

Auto Central December 12, 2008; Over the past couple of days I have vacillated between support for the U.S. auto industry bailout and "enough is enough", supporting a position that says we will all be better off by letting these mismanaged, and over labor costed car companies go away as failed entities...

But then I thought of all of my fellow Americans who have given their working lives over to companies and leaders who have continually made bad decisions and took greedy advantage of the situation...taking all reward with no personal risks.

Earlier today as I was trying to make sense of it all, I came upon this photo from last year, yes last year! In it you will see smiling GM management and equally smiling UAW leaders and it dawned on me that when something seems too good to be true it probably is. Both sides were feeding in a hog trough with no eye to their future. (Can you imagine the total lack of vision in that room?)

If management was doing their jobs they would not have agreed to labor's unreasonable demands and if labor's leaders were forward thinking, their demands would have included the "righting of the ship" and not just more more more!

For years and years weak U.S. auto industry management caved in to unrealistic and unsupportable demands from labor for unsustainable and non-competitive levels of pay and benefits for labor.

I am not blaming labor for taking as much as they could and not worrying about the good of the company as a whole, because if the misguided company management can make millions while the companies continued towards unprofitably and smaller and smaller market share, why shouldn't labor feed high off the hog too?

Well today is your answer...labor had to know that the sh-t would hit the fan someday, and that someday is now.

Why would any intelligent UAW member be surprised that the feeding trough is closed, that the industry that fed them and helped send their kids to college and helped them live their/our American dream could not continue as it was. They had to recognize their company's uncompetivness.

Although labor is just a piece of the total cost of a new car, it is the piece that reflects the total disregard for reality by all of the players in the domestic auto industry...yes we agree that it's management's fault but we also believe that it's labor's fault as well, all of the talk about labor and management being on the same team turned out to be true...with both sides showing disregard for the stockholders and the U.S. as a whole..."what's good for GM is good for the U.S.", was once true and must become true again...but realism has to enter the picture.

Top management must ensure that the vehicles they sign off on are the vehicles that buyers want and that the labor agreements they sign off on must allow their companies to be profitable forever.

Maybe allowing these three mismanaged companies to go away will serve the American people better in the long run than throwing more slop into the hogs feeding troughs.