Building A Better Automaker

CBS Evening News: Where American Companies Lack, Japanese Car Makers And Workers Are Thriving

(CBS)  Toyota, like other car markers, is trimming production as sales fall. So it might be a surprise how workers there feel about the future of their jobs.

"I am very secure in my job," said autoworker Bryan Gorden. "I think we make a quality product."

That's because these Texans work for a Japanese company, CBS News correspondent Barry Petersen reports.

"I kind of feel like Charlie from 'Charlie and the Chocolate Factory,' because I got the golden ticket," Gorden said.

Job security is a Japanese cultural tradition - a belief that workers are so important they are the last to be cut.

When Tundra pickup truck production stopped here for three months, some workers were out the door all right -- but on a furlough spent doing community service in San Antonio parks at full pay until the assembly line restarted and they went back to their regular jobs.

For running a tight, employee-friendly ship, the head of Toyota makes roughly $1 million. His company will make $5 billion, even in this tough year.

Ford's CEO makes a lot more, and losses could hit $7.5 billion.

At GM, good pay for the boss, and losses of $15.9 billion.

Lower salaries mean that for Japanese automakers, it's not about bailouts, but rollouts. Like the first Honda Civic at a new plant that opened in Indiana this week.

And having cash on hand for designing ever more new models despite a bleak outlook from the head of Nissan.

"The U.S. market remains extremely depressed, Europe continues to go down, Japan continues to go down," said Nissan's CEO, Carlos Ghosn.

But Nissan isn't letting tough times crimp the push for new technology.

A sleeker version of their all-electric car will hit American streets in about 2010, and in 2012, there will be one in a showroom near you, with a range of about 100 miles, or maybe more.

While the Big Three worry about paying their bills next month, Japan's car markers are already planning for next year and after … so that when the recession ends, Americans will have even more reasons to buy Japanese.

[jsd330]

Gee a Toyota autoworker is off for three months and gets his full pay. Wow the UAW workers only get 85% of their pay and thats including state unemployment benefits. And the man has a lifetime job. Boy the UAW sure got screwed by the big three, No lifetime jobs. I am sure if Toyota, Nissan or Mazda get into trouble the Japanese govrment will bail them out.

[downsteamjim]

Management whose pay is not related to profits and an unrealistic UAW may make fossils of the ''Big Three''.

[billpl-2009]

Wait until all those Toyota, Honda, Nissan employees start to retire and want more, more, more....

Close them down and off to China they''ll go

Who''s fooling who here?

[billpl-2009]

the part they forgot to tell you

Nissan is half owned by the French government
their bail out comes without asking

[demdump]

Close them down and off to China they''''ll go

Who''''s fooling who here?

Posted by Billpl

Japanese don''t like Chinese and Chinese don''t like Japanse,,,remember WWII ????
Get Wagner and Ford CEO and Chrysler CEO go to this plane and learn....and make sure to take a bus no privated jet....

[demdump]

Gee a Toyota autoworker is off for three months and gets his full pay. Wow the UAW workers only get 85% of their pay and thats including state unemployment benefits. And the man has a lifetime job. Boy the UAW sure got screwed by the big three, No lifetime jobs. I am sure if Toyota, Nissan or Mazda get into trouble the Japanese govrment will bail them out.

Posted by jsd330

Like UAW president said it not his Fault....Bunch of Criminals...

[notopennshut]

The big 3 must reorganize and restructure. The executives are overpaid, promises to support retirees for life, workers also overpaid in comparison to other foreign companies. How can these 3 survive??? CEOs paid unrealistic amounts plus benefits - they would never learn how to do things right other than enriching themselves first. Doomed to failure! No to a handout for these 3 unless drastic changes are made.

[mom_o_truth]

25 years of Mazda driving. First Mazda 13 years and 220,000 miles sold for $2500. Second Mazda 12 years 185,000 miles still running great. Japan knows how to make reliable, efficient and economic autos for the rest of us.

The U.S. auto makers went through this Oil crisis back in the seventies but did not learn their lesson to produce economic autos not gas-oholic monster SUVs. The amazing fact is that the gasoline producers hurt everyone, including the auto makers, with their greedy gas prices that are now dropping more than 70% in 4 months back to 2002 prices of $2/gallon.

[BeyondGreen]

Electric cars would cost the equilalent of 60 cents a gallon to charge and drive. The electricity could be generated from solar or wind sources.Fossil fuels are finite. We are using oil at twice the rate we are discovering new oil. We need to get on about the business of becoming energy independent and using alternative sources of fuel. The high cost of gas this past year seriously damaged our economy and society. While we are doing the happy dance around the lower prices at the pumps OPEC is planning further production cuts to drive prices back up. We have the knowledge, we have the technology, what America lacks is a plan. Jeff Wilson has a new book out that is beyond awesome. The Manhattan Project of 2009 Energy Independence NOW. He walks you through every aspect of oil, what it is used for besides gas, our depletion of it. The worlds increased need ie 3rd world countries becoming more modernized and consuming more. He explains EVERY alternative energy source and what role they can play to replace oil. His research is backed up with hard data and even includes a time frame and proposed legislative agendas to wean America off oil.

[mike18881]

mom_o_truth, Mazda is owned by Ford. Get your facts straight.

[newsnana]

A very one-sided report, perhaps because it was filmed in Japan. The cost per worker comparison was missing. foreign auto makers are non-union in the US, with much lower labor costs and they also avoid buying US made parts. The big three shared profits in good times via the UAW and have fixed costs in pensions and health benefits. There is also the question of dumping and restricted market entry in Asia. Do notice that smaller fuel efficient US cars have sold well in Europe. We have driven Fords, Chryslers, Buicks and an AMC with few problems over the years. Just traded in an old trouble-free Sable for the new model--which has won many awards, esp. for safety features. Our worst car was a Morris Minor.

[sunhunter2]

The Big 3 auto makers and the UAW could learn something from a folktale called, %u201CThe Wise Quail.%u201D It is the story about a quail who instructs his flock how to escape the hunter%u2019s nets by working together. He then encourages them to move deeper into the forest in order to practice cooperation. Some of the quail refuse to leave, and as a result of their arguing, they are caught by the hunter and perish.

Pelosi and Reid have done their job. They have asked for a plan to show that taxpayers%u2019 money will be used prudently. The auto makers have a second chance. The wise leader would gather his flock and prepare a sensible plan.

The airline industry lost TWA and PanAm years ago. Continental faced some hard times but, its management team used Chapter 11 to re-negotiate contracts, eliminate hubs, purchase a new, fuel-efficient fleet of planes, and improve flight load levels. They came up with a good plan. Then, they executed it. Now Continental is a great company with a bright future.

The Big 3 have smart people and good workers. They need each other. They can set aside their differences and put together a good plan. Ultimately, they will decide if they will be part of America''s past or its future.

Next.

[andylance1]

General Motors is a major sponsor of conservative talk radio hosts such as Rush Limbaugh, Sean Hannity and Laura Ingraham.

GM says it doesn''t pay the stars directly for their endorsements, although it advertises on their shows. It gives them new GM cars and trucks to drive for two weeks each month. The company also invites these right wing radio hosts to Detroit for private meetings with top executives and VIP tours of GM facilities.

Have you ever noticed that right wing talk radio never criticizes the government bailing out Detroit automakers? They are cynically being paid to keep their mouths shut by slime-balls like Rick Wagoner. A government bailout will make Limbaugh and Hannity even richer Judas goats.

[cheetah-man7]

Toyota''s are indeed the best cars made today. I own one now and other than basic preventative maintenance, never have any issues with it. Now THAT is a good car! I will NEVER again buy another US made car and now only look at Toyota''s. I am a very patriotic American, but I look for quality first, and do not buy my goods based on the country of origin. I would hate to see so many people in the BIG 3 laid off, but this may have to happen if the comapnies don''t get its act together. They have an opportunity of a lifetime now and if used wisely, they hav the potential of becoming the best car makers in the world. The proof will be in the end product. Let''s see if they can ever catch up to the Japanese.

[closethippy1]

What a bunch of stubborn mules these US automakers are. All this time they really thought they were outsmarting their customers by building cars that would last 3 to 5 years before needing an overhaul.
They couldn''t even build a freaking car door handle that would last past the car''s warranty.
They always took shortcuts.
They couldn''t even care less about increasing the milage in their cars.
Let them rot in hell. Good things always come when the rich suffer because of their arrogant behavior.

[cbs_oliver]

US autoworkers do not make $75 per hour.

Not even close.

More like $35 per hour.

That $75 number is a industry composed assignment to current workers of all costs for past and present workers including some that have already been paid into pension accounts.

That money is actually owed to both past and present workers and assigning it to current workers alone is deceit.

Calculated deceit which is likely to backfire this time.

What makes it even more rediculous is that some of the money is already sitting in accounts for retirement income and medical benefits and has effectively already been paid to retired workers who are no longer working.

The US motor industry is effectively counting past workers money as something they, the industry are now paying out. Claiming other people''s money. Typical, eh?!

Of course foreign companies recently investing in US plants don''t show much cost under this model. They don''t retirees or have a large pool of accumulated other people''s money to claim as a liability. They don''t have a history of large past profits either. All they have is the current salary of their current workers and the small accounts they have set up for their eventual retirement (maybe).

[cbs_oliver]

This report is trash.

Barry Peterson might do CBS viewers a favor by actually reporting on the details and facts rather than on the bogus spin of the political interests.

Too bad.

[cbs_oliver]

Average hourly salary for Non-Skilled, Assembly line worker:

GM: $31.35/hour (Includes idle workers still on payroll and those on protected status)

Toyota: $27/hour (Includes year-end bonus)

source: Center for Automotive Research

[craigh9]

US autoworkers do not make $75 per hour.
Not even close.
More like $35 per hour.
Posted by CBS_Oliver at 07:47 AM : Nov 21, 2008

This is true, the $75 is misleading - but the $35/hr. is still way above a reasonable rate for the job performed - and the benefits package is through the roof as well.

The big 3 needs to formulate a plan - in conjunction with the UAW to correct this mess in order to get the bridge laon from the government.

Specifically:
- approval from UAW for a 15% cut accross the board for all workers
- Management salaries cut by 33% and complete suspension of all bonus programs.
- A maximum salary of $2.5M for any position until such time that the government loan is repaid,
- A 20% reduction in operating expenses (corporate jets, junkets, political donations, etc.)

Then, and only then will they position themselves to be able to rebound from their current situation and be competitive in the future.

[worstever2]

Do not reward the big 3 for pitiful performance. It was their actions that got them here, let them gets themselves out of this jam.

One of your staff royally screws up time after time, then comes to you for a big raise to correct past mistakes ......... I don''t think so.

[dickyounger]

What the Unions want is card check so they can try to organize the autoworkers in the South. They want to raise the workers'' wage level there so the Big Three can now compete on labor costs! In other words, pull everyone down to their level!

[armydog2]

Why is everyone blaming the UAW union and not the pi-ss poor management who got these companies into this mess. All of the heads of these companies flew into Washington on private company owned jets, when asked to give up these jets they all sat very quiet. Reorganizing and restructuring is necessary and that means bankruptcy not 25 billion dollars. The union already agreed to a pay cut to save these companies.

[drgage]

I was upset by that story in that CBS news failed to mention that ALL those profits are going to an overseas company, not paying ine dime in US taxes. Or that the US automakers are supporting thousands of retirees with pensions and health care costs. What if GM does go bankrupt and all those people are now on Social Security and Medicaid? How much do you think that''s going to cost taxpayers?

[chenz66]

No matter how you slice it, GREED is what is causing the US automakers to go belly up.

[wnbear-2009]

Will cbs report on: actual US content,actual US federal income taxes paid, state subsidies to build plant, Report on actual wages ,benifits, an how many workers Toyota hired and then fired to man plant.
How many cars are still imported into US ,sold in Japan, other areas.
It actualy amazes me that many people believe they are the only ones who should have a decent wage and benifit package.

[wnbear-2009]

Just anote ,if Gm goes down in 10 years there will be no cars produced in US,That may be fine but tell me where will people then find jobs.

[helloall34]

I was upset by that story in that CBS news failed to mention that ALL those profits are going to an overseas company, not paying ine dime in US taxes. What if GM does go bankrupt and all those people are now on Social Security and Medicaid? How much do you think that''''s going to cost taxpayers?

Posted by drgage at 09:42 AM : Nov 21, 2008
===============================

They pay taxes, maybe not on a lot of the profit, but certainly on the costs of production. They are a huge contributor to the US economy. As for the retirees, it sure must be nice to have a "pension", and benefits after retirement, no one under 60 in the US knows what such things are. We have to have universal health care in this country, their is no other way out.

Simplistic artice, simplistic conclusions.

The Japanese heavily subsidize and protect their auto industry, the CEO also has guaranteed healthcare, retirement. Also if you look carefully that''s the BASE salary, not total compensation which the Japaneese do not report. GM CEO''s base was 2.2 mil last year.

Anybody care to ask the guy who wrote this artice got paid? Anybody ask how much the CS CEO gets? How about Letterman? Should he be paid less?

So, be jealous of what others make and tell us more bedtime fairy tales, because, their are those out there that will just suck it up and believe the BS

[avengertiger]

As a visitor to the US from the UK.

This whole story is like history repeating itself. If you want to see where your car industry is headed if things don''t change, look at what happened to the once proud, market leading UK car industry.

In the 70''s the car companies were badly managed and strangled by strong,but greedy and short sighted unions. The government poured good money after bad, but the car makers still produced poor quality, unreliable *** that no one wanted!

Then the Japanese introduced their not very exciting and strange offerings. They were boring to drive and looked pretty ugly, but guess what - they didn''t break down or fall to pieces and offered great value for money.

Roll on a few years and see what happened, the UK has no home grown (volume)car industry of which to speak. The cars that are produced there now are high quality, reliable, economical and right for todays market. Their names? Toyota, Nissan, Honda - sound familar?

Come on guys, to use your expression, ''wake up and smell the coffee!''. Save your auto industry while you still can. Managers, designers, workers you can do it if you beat the *** at their own game.Put all your skills and efforts together.Make it happen! Good Luck!

[qutlaw104]

The last two cars I bought with american names, one gmc,one Dodge were assembed in Mexico.

[koyt1]

Thank God our representatives are not willing to hand over billions for the auto industry to **** away. They must change their way of doing business if they are going to compete.

[tawabill]

The writer of this piece obviously hasn''t looked at Toyota''s practices in its home plants where the company uses lots of "temporary" labor that is paid far less and has almost no benefits. Toyota also expects a lot of unpaid work and has had to pay pensions and awards to the families of employees who were literally overworked to death.

Toyota''s monthly sales report includes details of what percentage of the vehicles sold were produced in the U.S./NAFTA and what percentage were produced in Japan.

A worker in the Toyota plant in Georgetown, Kentucky makes an average of $25/hour. A UAW worker makes $28/hour and new hires in non-assembly jobs can be paid $14/hour. Yes, the UAW benefit package is lavish, but a lot of the cost is healthcare over which neither the automaker or autoworker has any control. You want to see some improvement in that area, support healthcare reform.

In addition, the UAW has already made a number of concessions and has indicated it''s willing to make more to help the automakers. Contrast that with the three CEOs who flew on private jets to Washington and get free cars with even the gasoline and insurance paid.

[hitoyou1]

Easy, GET the UAW OUT.

[hitoyou1]

"temporary" Help. Good. There are A LOT of U.S. companies that do the same thing. One of, if not the bigges tool maker in the WORLD has ove 50% temporary workers. Whats the big deal. Better than paying the no good UAW a lot of money and have the company go BROKE.

[hober_mallow]

"The last two cars I bought with american names, one gmc,one Dodge were assembed in Mexico..."

I know. A couple of years ago, I traded in my Toyota pickup (made in U.S.A.) to buy a Dodge Ram pickup. I figured, hey, I''ll do my part to help out Detroit.

Well, guess what. The Dodge Ram was made in Mexico.

About a year ago, while it still held its value, I traded it in on another new Toyota, made in the U.S.A.

[billpl-2009]

Side note about the UWA.

Over the past fifty years there were how many strikes and boiler-plate contract negotiations?
And all about what?
Wages,overtime, work conditions, pensions, vacations, benefits....

But not a single demand about
designing better, more competitive cars for them to build
or fuel efficiency and air pollution
or quality control standards
or building better tooled plants
or plant and manufacturing efficiency
...no, nothing, nada

the UWA can eat my shorts

[billpl-2009]

UAW ooops :-)

[beach671]

Quit selling out American workers. They have families they are trying to support. Detroit made $15,000 profit on every single SUV. The American pony car is full of Communist China parts.how much profit from the Ford Mustang is being made while everyone wants to kill yet more American jobs and their wages?

Our purpose should not be to make Kings who get all the money and profits and demand we get less and unable to buy those Detroit cars.


Quit killing the middle class, or the economy will get much worse. The wages of the UAW didn''t kill Detroit. Less middle class in America able to afford new cars killed Detroit.

[newlector]

I think the real problem is the Union, the employees are OVER PAY, and all the benefits they have!!!
I hear they have 12,000 people who are standby earning $73.00 an hour...that sucks.
The CEO''s are waiting millions of dollars.
Facts:
Not all of us like American cars
Most of them are ugly and over price
They offer lower miles per gallon

Toyota, Nissan, Honda even Hyundai have better cars for the same amount of money or less...and these cars are made in USA.
Buy and American car now any brand and try to sell it one year latter and you see how much you can get IF YOU FIND A BUYER!!!
Buy a Japanese or Korean car and you will have a different experience, don''t believe me, check the Blue Book or go to Edmund.com
Being patriotic is GOOD being Stupid is Wrong...

[cjw3cma]

PLEASE let the American automobile industry declare bankruptcy and do the necessary reorganization that is so overly due. Henry Ford would be ashamed of what his car company has become. Hundreds of millions of dollars paid to top executives for doing what? The same job that almost everyone does for 1/3 the money (if not 1/4). Let them fail. From their ashes may come 21st century minded organizations that will produce fuel efficient products that the current American companies have fought tooth and nail to keep from being implemented. No excuse that comes from the mouths of the auto execs is to be believed. Let them fail.

[jsd330]

billpl Wake up the UAW has no say on what the companies build, never have and I doubt they ever will. The CEO''s and the MBA''s look at what the designers come up with and then they decide if it is profitable to produce.

[babooph]

THE OLD SET UP OF LOBBYISTS GETTING IMPORT QUOTA & TAXES ON FOREIGN AUTOS-will continue,combined with our best engineer graduates going for war stuff& the big $$,leaving 2nd rate design for consumer goods-it clearly failed,but corruption has no bottom.

[emperorlotku]

Last night CNN aired a broadcast from The Upper Deck Tavern in Moraine Ohio. It is right next door to the GM Moraine Assembly plant. This bar specialized in lunches where the "quality" union workers would get as many beers consumed as possible during lunch and then return to work to put brakes on cars that our children are in. It is also next door to the GM parking lot where all the drug trafficking has been occuring for decades. Now the drinking and drugging was tolerated because the "entitled" union workers were protected by a system that expected the lowest quality from the least qualified. Only half of the union workers that "worked" this plant had a work ethic that could be transferable to another job environment. Most of them will have a huge problem getting reemployed because of the sad reputation of the unions.

[andylance1]

Congress should give 25 billion each to Toyota and Nissan to build factories in Michigan and tell the big three to go to hades where sun don''t shine.

Ford and GM have had very few decent cars made since the 1960s. Detroit cars don''t get better, they get bigger and longer and thirstier. Detroit management and union druggies and alcoholics have dug their own grave - RIP.

[hitoyou1]

The UAW is BS. Not wortha dime, don''t know what work is, are wortless at doing anything, they can drink beer and do dope, but that is all. They don''t want anything but a hand out. Nost can not do a days work and never will do a days work. Union are good for one thing, keeping paople at jobs they can not DO. Some one to keep there job for them, that is why people are in a union.

[hitoyou1]

The wages of the UAW didn''''t kill Detroit. Less middle class in America able to afford new cars killed Detroit. "YES THE WAGES OF THE UAW DID KILL DETROIT"

[valenzdoc]

there''s something to be said about using good business practices. I agree that the founding fathers for the big 3 would be so disappointed. These ceo''s lust for the dollar has blinded them. If they are able to overcome this I hope they rid themselves of those who put them in this position and begin to think "long term" solutions.