America is not the only market for the Big Three either. They both manufacture and sell cars all over the world. In fact, I recall reading somewhere recently that GM's non-domestic sales & manufacturing are so profitable that they've essentially subsidized the company's domestic operations for years now. What is crippling the Big Three right now is simply that the domestic market is so bad, and has become such an enormous drain, that even the income from their other operations can't keep them afloat anymore.

America is not the only market for the Big Three either. They both manufacture and sell cars all over the world. In fact, I recall reading somewhere recently that GM's non-domestic sales & manufacturing are so profitable that they've essentially subsidized the company's domestic operations for years now. What is crippling the Big Three right now is simply that the domestic market is so bad, and has become such an enormous drain, that even the income from their other operations can't keep them afloat anymore

And with the recent global auto downturn, most of the foreign operations are in just as much trouble.

The cost per hour of work for a typical UAW member in the US, benefits included, is between $70 and $76 dollars per hour.

hour rate = (total cost of active + retiree UAW) / (# hours performed by active UAW)

Essentially the cost of retirees is folded into that hourly rate for active employees. The active employee disparity is still large, but roughly half of what the $70 number implies.

Many of the retirees are from an era when the auto companies had many more auto workers. Their marketshare was bigger, they had less automation, and did more in-house. So retiree legacy is disproportionate to their current workforce.

The light at the end of the tunnel for the auto companies is that block of disproportionately sized retiree legacy can't live forever.

The japanese workers in your stat are Americans working for japanese companies and there are several other mistakes in your post. Please try to get half of your post correct before posting.

"This is not quite true. This number comes from the formula
hour rate = (total cost of active + retiree UAW) / (# hours performed by active UAW)

Essentially the cost of retirees is folded into that hourly rate for active employees. "

But it's still a cost, and they still have to pay it - and it IS part of the problem here.

Honestly, why should I care if the auto makers go under? All my life, the auto workers' unions have used their political power for changes that benefit them and harm me. They used the same power to dig the hole they're in now; why should I have to foot the bill? Screw them, screw their jobs, and screw the economy. The problem won't get any better if you keep rescuing idiots from themselves.

I'll get by as I always have, in whatever way I need to, and I'm tired of paying for other people's screwups.

"For one, there wasn't exactly a market for smaller, fuel-efficient cars in the US because, well, Americans wanted bigger ones. Just a few years ago, gas was around a buck and a quarter, we wanted safer, more practical SUVs, and we could afford them."

That's only one, the smallest, part of the SUV equation.

When the congressional {lack of]-brainiacs got involved and started the CAFE standards that omitted SUV's and truck sized vehicles that green-lighted Detroit to produce them and America consumers went right along with the subsequent marketing campaign.

Also, Toyota and the other Japanese car makers are relatively new on the scene and do not have the huge pension benefit payouts that Ford and GM have.

I deal with pension benefits daily and I see what some of these companies are paying out and I have to wonder how they're going to stay viable for much longer as more and more people retire.

All my life, the auto workers' unions have used their political power for changes that benefit them and harm me.

So if you only tunnel vision on what you spend, you may see it that way. But somebody needs to pay you and buy what you do.

Or we may be saying sayonara to the auto industry.

I disagree.

Infrastructure is there.

Labor is there (I'll bet you could find at least some people who will work for what Toyota is paying.)There is a great opportunity for someone to pick up this opportunity and start over the way that Detroit should restart.

So if you only tunnel vision on what you spend, you may see it that way. But somebody needs to pay you and buy what you do.quote>

You need a little lesson in economics. With your own business you live and die with how you manage your products, your prices and your costs. That's the way it works for small business.
Government subsidizing failure is the worst possible thing for economies.

Toyota pays a hell of a lot. At their plant down the road from my parents' place, they offered my brother (experienced welder) an hourly wage that would have gotten him about $90,000/year including overtime. He declined as they are sometimes forced to work ridiculously long hours--for which they are compensated, but it's nice not to have to work 70 hours in a week if you don't want to.

They don't mind paying high wages, they're just smarter about the other costs. (Building plants in Ontario saves them most healthcare expenses, and we have a lower corporate tax rate here.) They also refuse to cede bargaining control to unions by preempting employee demands, like high wages and good working conditions. (Unions can't get traction where people are paid well and treated fairly.)

"Or we may be saying sayonara to the auto industry."

I disagree.

Infrastructure is there.

Labor is there (I'll bet you could find at least some people who will work for what Toyota is paying.)There is a great opportunity for someone to pick up this opportunity and start over the way that Detroit should restart.

Yet there is no 4th auto company. No one sprung up to show them how it was done.

Well, except Delorean.