Monday, September 24, 2007

UAW and GM Both Hypocritical

On Monday Sep 24 at 1100 ET UAW members struck GM (GM) plants. Ford (F) and Chrysler continue to churn out cars that not enough people want. The Big Three in Detroit and the union need to solve the health care issues before it consumes all of them forever. GM has an ugly unfunded health care liabilities of approximately $50 billion and climbing on their balance sheet.

The union could not bring itself to reach a deal in probably the most important negotiations they have ever had. The membership understands there is an ugly problem but they do not want to face reality.

The company needs cover to point to a difficult union situation. This will take the spotlight away from management problems such as design and market share.

The union is saying they want security. But the current working membership of UAW is a fraction of what it was ten or fifteen years ago. Those are real job loses and the union only now wants to go on strike.

Management needs to say we tried but they would not listen to reason. There are two groups which have taken the pain over the past ten or so years. The common worker and the common shareholder. So far the prescription of pain seems to be continuing.

Both management and the union have pulled the pin on the hand grenade and are passing it back and forth; hoping that the sweat on your hand .....well you know.

As negotiators they need someone to impose a deal. In the meantime the foreign car maker with plants in the US will continue to eat Detroit's lunch.