GM Earns almost $1 Billion in 2nd Quarter
GM's cost-cutting is starting to show on the bottom line, as the company reported its third consecutive quarter of positive earnings. The earnings for the 2nd fiscal quarter of 2007 were $891 million, as compared to a loss of $3.4 billion in the same quarter of last year.
GM's earnings were decreased by a $341 million bail-out of Delphi. Although some analysts expected GMAC to post a loss due to the subprime mortgage market, GMAC posted a $239 million profit, an amount roughly equal to 1/3 of last year's finance profits. GM sold off 51% of GMAC last year. The $239 million gain (apparently) represents GM's 49% share.
GM was profitable virtually everywhere but North America. Still, the North American loss, at $49 million, is fairly minor statistically.
GM's overall revenue shrank to about $47 billion, compared to $54 billion last year. GM's market share shrunk to a little under 23% in the North American market.
These results came in during the early stage of contract negotiations with the UAW. Ironically, a loss might have helped GM at the bargaining table. The fact that GM posted a narrow profit may help stave off the termination of legal services coverage for the remaining UAW members. Source: Detroit News
Tuesday, July 31, 2007
Monday, July 30, 2007
Nissan's Altima Coupe 2.5S
New Queen of the Secretarymobiles
Two-door Japanese 4-cylinder cars traditionally have the reputation as being "secretaries' cars." The owner demographics tend to be heavily-weighted to female ownership. Nissan just came out with a 2-door version of the Altima. As it so happens, Nissan is selling them faster than they can make them. My sister wants one, but I haven't been able to find one. Here's a Edmunds.com comparison sheet that I worked up comparing the Altima Coupe with the outgoing Honda Accord Coupe, Toyota Camry Solara, Mitsubishi Eclipse, and the only American model squarely in the segment, the Pontiac G6 Coupe. Actually, the G6 isn't squarely in the niche, because it's a 6-cylinder, but the price is similar to the others, so the G6 is cross-shopped. Quite frankly, even though the Pontiac's performance is similar to the other cars, it's fuel economy is not in the same league with EPA city rating of 18 MPG (under the 2007 ratings) vs. EPA 23 for the Nissan under the harsher 2008 standard. The big culprit in the drastic difference in fuel economy is the difference in transmissions. The Nissan has a top-of-its-class CVT automatic transmission, while the Pontiac has a standard (old) 4-speed automatic. In a family sedan comparison in the March 2007 issue of Consumer Reports Magazine, the 2007 Nissan Altima Sedan beat a bevy of newish family sedans including the Saturn Aura and the Pontiac G6 in both 4 and 6 cylinder forms. Nissan's CVT transmission allowed the 4-cylinder Altima to accellerate with the 3.5 liter 6-cylinder GM cars, but had much higher fuel economy. GM's 4-cylinder was still hamstrung by the General's ancient 4-speed automatic transmission. (By the way, in the March '07 comparison, the lowest rated cars were Chrysler's Sebring and the Dodge Avenger, cars that even Chrysler's own executives describe as "disappointing".
According to GM Car Czar Bob Lutz's Fastlane blog, the 2008 Altima will also debut with the 4-speed automatic, though a 6-speed auto will be available later. Though Lutz raves about the redesigned Malibu, it will have to go up against excellent cars like the Altima and Camry PLUS an as-yet-unveiled, redesigned, 2008 Honda Accord. Good luck with that Bob.
New Queen of the Secretarymobiles
Two-door Japanese 4-cylinder cars traditionally have the reputation as being "secretaries' cars." The owner demographics tend to be heavily-weighted to female ownership. Nissan just came out with a 2-door version of the Altima. As it so happens, Nissan is selling them faster than they can make them. My sister wants one, but I haven't been able to find one. Here's a Edmunds.com comparison sheet that I worked up comparing the Altima Coupe with the outgoing Honda Accord Coupe, Toyota Camry Solara, Mitsubishi Eclipse, and the only American model squarely in the segment, the Pontiac G6 Coupe. Actually, the G6 isn't squarely in the niche, because it's a 6-cylinder, but the price is similar to the others, so the G6 is cross-shopped. Quite frankly, even though the Pontiac's performance is similar to the other cars, it's fuel economy is not in the same league with EPA city rating of 18 MPG (under the 2007 ratings) vs. EPA 23 for the Nissan under the harsher 2008 standard. The big culprit in the drastic difference in fuel economy is the difference in transmissions. The Nissan has a top-of-its-class CVT automatic transmission, while the Pontiac has a standard (old) 4-speed automatic. In a family sedan comparison in the March 2007 issue of Consumer Reports Magazine, the 2007 Nissan Altima Sedan beat a bevy of newish family sedans including the Saturn Aura and the Pontiac G6 in both 4 and 6 cylinder forms. Nissan's CVT transmission allowed the 4-cylinder Altima to accellerate with the 3.5 liter 6-cylinder GM cars, but had much higher fuel economy. GM's 4-cylinder was still hamstrung by the General's ancient 4-speed automatic transmission. (By the way, in the March '07 comparison, the lowest rated cars were Chrysler's Sebring and the Dodge Avenger, cars that even Chrysler's own executives describe as "disappointing".
According to GM Car Czar Bob Lutz's Fastlane blog, the 2008 Altima will also debut with the 4-speed automatic, though a 6-speed auto will be available later. Though Lutz raves about the redesigned Malibu, it will have to go up against excellent cars like the Altima and Camry PLUS an as-yet-unveiled, redesigned, 2008 Honda Accord. Good luck with that Bob.
Measure your car's Weeeee! Factor with Wii Remote
Vwvortex.com has instructions on how to convert your wii remote into an accellerometer that can measure you5r car's accelleration and g-forces through a connection to a pc. It sounds like a fun hack.
If someone wants to buy me a Wii, I'll be happy to check it out.
Vwvortex.com has instructions on how to convert your wii remote into an accellerometer that can measure you5r car's accelleration and g-forces through a connection to a pc. It sounds like a fun hack.
If someone wants to buy me a Wii, I'll be happy to check it out.
Cheney Gets DeFibbed
V.P. Dick Cheney went in the hospital this week for a new internal heart defibrillator. While he was under anestesia, he passed his duties onto his second in command: Satan.
Despite the new defibrillator, fibbing in the whitehouse is expected to continue without interruption.
V.P. Dick Cheney went in the hospital this week for a new internal heart defibrillator. While he was under anestesia, he passed his duties onto his second in command: Satan.
Despite the new defibrillator, fibbing in the whitehouse is expected to continue without interruption.
Friday, July 27, 2007
Forbes Magazine: The 10 most dangerous vehicles
Drive a Buick Rendezvous, and you might have a rendezvous with death. Well, I may be overstating the point, but the Buick Rendezvous is singled out as the least safe in the group of the 10 most dangerous vehicle as published in the Forbes magazine article linked here. According to the article, recent safety data suggests that electronic stability control is a big factor in avoiding highway fatalities. Most vehicles still don't' have it.
Speaking of Rendezvous with Death
Meet Oscar the Kitty of Doom
According to CNN, Oscar, the resident cat at a nursing home in Providence, Rhode Island, can pick out which patient in the nursing home is going to be the next to die. If Oscar cuddles up to you, it's important to say "I don't want to go on the cart."
Drive a Buick Rendezvous, and you might have a rendezvous with death. Well, I may be overstating the point, but the Buick Rendezvous is singled out as the least safe in the group of the 10 most dangerous vehicle as published in the Forbes magazine article linked here. According to the article, recent safety data suggests that electronic stability control is a big factor in avoiding highway fatalities. Most vehicles still don't' have it.
Speaking of Rendezvous with Death
Meet Oscar the Kitty of Doom
According to CNN, Oscar, the resident cat at a nursing home in Providence, Rhode Island, can pick out which patient in the nursing home is going to be the next to die. If Oscar cuddles up to you, it's important to say "I don't want to go on the cart."
GM Full-Sized SUV Hybrids to get 20MPG in-town?
This fall, General Motors plans to introduce new hybrid versions of its GMC Yukon and Chevrolet Tahoe sport utility vehicles. This is a different and more sophisticated hybrid system than the system that is currently featured on the Saturn Vue and Saturn Aura. The Saturn system is a "mild" hybrid based upon a belt-starter-alternator system. The new SUV system will be a full "dual-mode" hybrid. GM actually jointly developed the new system with BMW and Chrysler.
According to the USA Today article linked, GM plans to build 10,000 of the hybrid SUVs this year, and GM will likely subsidize part of the $10,000 incremental cost of the hybrid system.
This fall, General Motors plans to introduce new hybrid versions of its GMC Yukon and Chevrolet Tahoe sport utility vehicles. This is a different and more sophisticated hybrid system than the system that is currently featured on the Saturn Vue and Saturn Aura. The Saturn system is a "mild" hybrid based upon a belt-starter-alternator system. The new SUV system will be a full "dual-mode" hybrid. GM actually jointly developed the new system with BMW and Chrysler.
According to the USA Today article linked, GM plans to build 10,000 of the hybrid SUVs this year, and GM will likely subsidize part of the $10,000 incremental cost of the hybrid system.
Latest Poll: Obama whips Repubs
Other Dems - Not so much
In what seems like a game of rock paper scissors, the latest poll numbers show Clinton beating Obama, Obama beating Giuliani, and Giuliani beating Clinton.
If that ain't confusing enough, Edwards & Romney are ahead in Iowa.
Johnny, what can you make of this . . . "a hat, a broach, a pterodactyl"
Other Dems - Not so much
In what seems like a game of rock paper scissors, the latest poll numbers show Clinton beating Obama, Obama beating Giuliani, and Giuliani beating Clinton.
If that ain't confusing enough, Edwards & Romney are ahead in Iowa.
Johnny, what can you make of this . . . "a hat, a broach, a pterodactyl"
PDF Spam - Why it's flooding your inbox
Here's a link to a PCWorld article describing the latest trend in spam, blank files with Adobe Postscript (.pdf) file attachments. Spammers have started sending pdf files because spam filters are getting better at filtering out the image messages that were all the rage earlier this year. There is apparently disagreement about whether these attached documents can harbor a payload that will harm or take over your system. It's better not to open a pdf file you weren't expecting.
Here's a link to a PCWorld article describing the latest trend in spam, blank files with Adobe Postscript (.pdf) file attachments. Spammers have started sending pdf files because spam filters are getting better at filtering out the image messages that were all the rage earlier this year. There is apparently disagreement about whether these attached documents can harbor a payload that will harm or take over your system. It's better not to open a pdf file you weren't expecting.
Youtube video of the Day:
Deposition from hell
Mix an uncooperative witness, a man wearing a stocking cap, and Mama getting hit on the head with a lamp, and you get the deposition from hell at this link.
Deposition from hell
Mix an uncooperative witness, a man wearing a stocking cap, and Mama getting hit on the head with a lamp, and you get the deposition from hell at this link.
From the No Way file:
Ford Posts 2nd quarter Profit
With no thanks to the North American Market, Ford posted a $750 million profit in the 2nd Quarter of 2007. This is Ford's first profit in two years. While the North American automotive operations lost both money and market share. Ford was profitable abroad. Even its notoriously money-losing Premier Automotive Group made a slight profit. Ford Motor Credit broght a billion dollars to the bottom line. Cost-cutting played an important role in the profitability of the company.
Ironically, the reported profit couldn't have come at a worse time. Ford is seeking drastic cuts to its labor costs in the contract negotiations currently under way with the union. Tee better Ford looks financially, the less willing the UAW will be to make the big cuts.
Ford Posts 2nd quarter Profit
With no thanks to the North American Market, Ford posted a $750 million profit in the 2nd Quarter of 2007. This is Ford's first profit in two years. While the North American automotive operations lost both money and market share. Ford was profitable abroad. Even its notoriously money-losing Premier Automotive Group made a slight profit. Ford Motor Credit broght a billion dollars to the bottom line. Cost-cutting played an important role in the profitability of the company.
Ironically, the reported profit couldn't have come at a worse time. Ford is seeking drastic cuts to its labor costs in the contract negotiations currently under way with the union. Tee better Ford looks financially, the less willing the UAW will be to make the big cuts.
Monday, July 23, 2007
Bush's Polyps not Cancerous
Word has come down that President Bush doesn't have colon cancer. As I understand it, the doctor had to send him the results in writing rather than face to face. The purpose was to avoid what happened the last time. The last time, the doctor said,"We have the results, it's benign." Whereupon George blurted out reflexively, "Bingo."
Word has come down that President Bush doesn't have colon cancer. As I understand it, the doctor had to send him the results in writing rather than face to face. The purpose was to avoid what happened the last time. The last time, the doctor said,"We have the results, it's benign." Whereupon George blurted out reflexively, "Bingo."
Will it Blend - iPhone
Waste of a Phone or a Life?
A few weeks ago, I stumbled upon a series of videos on youtube called Will it Blend? Some smart marketers at a blender company called Blendtec decided to post videos of everything from a crowbar, to a stuffed animal, to a pile of glow sticks being pulverized in one of their blenders. If you cross the hype of the iPhone with the youtube fad that WIB had already become, and the Will it Blend iPhone edition has become ridiculously popular among bloggers with over 1.5 Google hits as of this writing. Just one version of the iPhone blending on Youtube.com has over 1.3 million views. Let's say, then that just 10 million people have spent a minute and half watching the iPhone blend. that's 28.5 person/years spent watching the iPhone blend. if the real total is 100 million people seeing the iPhone blend, then that's 285 years or about 3 and a half life times spent watching an iPhone blend. The worldwide web - it brings new meaning to life.
Watching the iPhone blend is a complete waste of time. The glowsticks, on the other hand, that was cool.
Waste of a Phone or a Life?
A few weeks ago, I stumbled upon a series of videos on youtube called Will it Blend? Some smart marketers at a blender company called Blendtec decided to post videos of everything from a crowbar, to a stuffed animal, to a pile of glow sticks being pulverized in one of their blenders. If you cross the hype of the iPhone with the youtube fad that WIB had already become, and the Will it Blend iPhone edition has become ridiculously popular among bloggers with over 1.5 Google hits as of this writing. Just one version of the iPhone blending on Youtube.com has over 1.3 million views. Let's say, then that just 10 million people have spent a minute and half watching the iPhone blend. that's 28.5 person/years spent watching the iPhone blend. if the real total is 100 million people seeing the iPhone blend, then that's 285 years or about 3 and a half life times spent watching an iPhone blend. The worldwide web - it brings new meaning to life.
Watching the iPhone blend is a complete waste of time. The glowsticks, on the other hand, that was cool.
Sunday, July 22, 2007
Fifth Third Mortgages Defy Gravity
Some ARMS go up but don't go down - Class Certified
There aren't very many lawyers in Indiana handling consumer cases, but two of the few, M. Scott Barrett, of Bloomington, and Constantine "Kim" Orfanos, of Indianapolis, have won a hard-fought battle to get a class certified in the case of a client with an adjustable rate mortgage (ARM) that went up but didn't come down.
When a big lender like Fifth Third "accidentally" fails to adjust a mortgage for falling interest rates, but has no problems tacking on rate increases, you gotta believe that it probably wasn't an accident; and you have to believe that it probably didn't happen to one customer. In the case of Grider vs. Fifth Third Bank, shortly after the lawsuit was filed in 2004, the bank admitted that it miscalculated the interest rate. While admitting an error, the company fought like the dickens any discovery motions that would prove that the imposition of a n unwarranted "floor" interest rate was unique to the named plaintiff, but the same time, the bank maintained that it was an isolated incident. (Hmm, what's wrong with this picture?) The plaintiff's attorneys fought for three years, and in April, they got an order certifying a class. (Grider vs. Fifth Third Bank, Case No. 49D07-0404-PL-000819, Marion Superior Court, Marion County, Indiana). In the three year fight, they were able to determine that 49-60 ARM loans improperly had a "floor" rate improperly set. The class definition includes prospective loans issued in Ohio and Kentucky. While that doesn't seem like many loans to a big company like Fifth Third, and it may be a small portion of their entire portfolio, it's potentially hundreds of thousands of dollars in extra interest being paid by the homeowners. It will be interesting to see what numbers come out of the Ohio and Kentucky loans. I'd also be interested to find out if there was a third party which designed the loan products and the software tracking the loans. If so, an "error" by a regional bank like Fifth Third might have been repeated by other lenders across the country.
However big or small this case turns out to be, congratulations to Scott and Kim, the lawyers, and to Mr. and Mrs. Grider, the clients. You've won a battle against the big boys, and not everybody can say that.
(Oh yeah, Kim Orfanos is a UAW-LSP alum. For fellow 3357 members who are concerned about life after the death of the unionized auto industry, this proves that there is hope for us all.)
Some ARMS go up but don't go down - Class Certified
There aren't very many lawyers in Indiana handling consumer cases, but two of the few, M. Scott Barrett, of Bloomington, and Constantine "Kim" Orfanos, of Indianapolis, have won a hard-fought battle to get a class certified in the case of a client with an adjustable rate mortgage (ARM) that went up but didn't come down.
When a big lender like Fifth Third "accidentally" fails to adjust a mortgage for falling interest rates, but has no problems tacking on rate increases, you gotta believe that it probably wasn't an accident; and you have to believe that it probably didn't happen to one customer. In the case of Grider vs. Fifth Third Bank, shortly after the lawsuit was filed in 2004, the bank admitted that it miscalculated the interest rate. While admitting an error, the company fought like the dickens any discovery motions that would prove that the imposition of a n unwarranted "floor" interest rate was unique to the named plaintiff, but the same time, the bank maintained that it was an isolated incident. (Hmm, what's wrong with this picture?) The plaintiff's attorneys fought for three years, and in April, they got an order certifying a class. (Grider vs. Fifth Third Bank, Case No. 49D07-0404-PL-000819, Marion Superior Court, Marion County, Indiana). In the three year fight, they were able to determine that 49-60 ARM loans improperly had a "floor" rate improperly set. The class definition includes prospective loans issued in Ohio and Kentucky. While that doesn't seem like many loans to a big company like Fifth Third, and it may be a small portion of their entire portfolio, it's potentially hundreds of thousands of dollars in extra interest being paid by the homeowners. It will be interesting to see what numbers come out of the Ohio and Kentucky loans. I'd also be interested to find out if there was a third party which designed the loan products and the software tracking the loans. If so, an "error" by a regional bank like Fifth Third might have been repeated by other lenders across the country.
However big or small this case turns out to be, congratulations to Scott and Kim, the lawyers, and to Mr. and Mrs. Grider, the clients. You've won a battle against the big boys, and not everybody can say that.
(Oh yeah, Kim Orfanos is a UAW-LSP alum. For fellow 3357 members who are concerned about life after the death of the unionized auto industry, this proves that there is hope for us all.)
Wednesday, July 18, 2007
Holy Cellulostic Biomass Batman
The utility of ethanol as a practical fuel is limited today because the corn and sugar cane used to produce the alcohol are prized as food and animal fodder, and it takes a lot of energy to process the alcohol and get it to market. The holy grail of alcohol production has been cellulostic alcohol, alcohol made from the stalks and stems of the source plants rather than the seeds, fruits & nuts. Though it's long been known that bacteria exist that can break down the roughage parts of plants, these bacteria have stubbornly resisted efficient cultivation.
Until now, that is, at least according to Honda. According to a press release reported at zdnet.com, Honda and its research partner, Research Institute of Innovative Technology for the Earth, or RITE, have come up with a breakthrough process allowing efficient production of alcohol from cellulose stock. Here's a quote:
When this technology spreads, the Beverly Hillbillies can move back from Beverly Hills to the hills of Tennessee, put their knowledge of corn-squeezins to work, and get rich all over again.
The utility of ethanol as a practical fuel is limited today because the corn and sugar cane used to produce the alcohol are prized as food and animal fodder, and it takes a lot of energy to process the alcohol and get it to market. The holy grail of alcohol production has been cellulostic alcohol, alcohol made from the stalks and stems of the source plants rather than the seeds, fruits & nuts. Though it's long been known that bacteria exist that can break down the roughage parts of plants, these bacteria have stubbornly resisted efficient cultivation.
Until now, that is, at least according to Honda. According to a press release reported at zdnet.com, Honda and its research partner, Research Institute of Innovative Technology for the Earth, or RITE, have come up with a breakthrough process allowing efficient production of alcohol from cellulose stock. Here's a quote:
Current technology for converting cellulosic biomass yielded impractically low levels of ethanol due to the interference of fermentation inhibitors with the function of microorganisms that convert sugar into alcohol. The fermentation inhibitors are formed primarily during the process of separating cellulose and hemicellulose from soft biomass.
The new process uses a microorganism developed by RITE that helps reduce such interference, enabling far more efficient ethanol production.
"This achievement solves the last remaining fundamental hurdle to ethanol production from soft biomass," Hideaki Yukawa, chief researcher at RITE's molecular microbiology and genetics lab, said during a news conference in Tokyo.
When this technology spreads, the Beverly Hillbillies can move back from Beverly Hills to the hills of Tennessee, put their knowledge of corn-squeezins to work, and get rich all over again.
Monday, July 16, 2007
Is Ford Selling Volvo?
Who's going to design future Fords?
Only Ford's hairdresser knows for sure if the the automaker is planning on selling the Volvo brand. Contradictory reports have been bantered about in the press over the weekend and spilling into today. Volvo is one of the few parts of Ford that is making money, $402 million in the first quarter of 2007 according to Forbes magazine. For has pledged most of its industrial assets to get working capital for its turn around plan, so tough decisions regarding asset sales may be inevitable. It's not clear how much cash would actually realize if it sold Volvo. According to Edmunds.com, Volvo was one of the assets that Ford pledged to get the working capital. The mortgagee would seem to have the upper hand in negotiations to remove the security interest over the Volvo assets.
Volvo is more than just a niche marketer of "boxy but good", safe European cars, Volvo engineering contributes to most of Ford's design. The Ford Five Hundred/ (new) Taurus and Freestyle ride on a Volvo platform. If you take away the Volvo-engineered cars, and the Mazda-derived cars including the Fusion/Milan/MKS and Focus, it doesn't leave much in the way of passenger cars, just the niche market Mustang and the ancient but vanishing Crown Vic. As much as Ford likes to complain about the cost and productivity of the UAW members, it seems that Ford is getting much less productivity out of its engineering employees. Other than the Mustang and its organ donor the Lincoln LS, I can't think of a single new-from-the-ground-up passenger car that Ford has engineered in the United States and introduced in the past 10 years. All those engineers can't be working on trucks, can they?
Who's going to design future Fords?
Only Ford's hairdresser knows for sure if the the automaker is planning on selling the Volvo brand. Contradictory reports have been bantered about in the press over the weekend and spilling into today. Volvo is one of the few parts of Ford that is making money, $402 million in the first quarter of 2007 according to Forbes magazine. For has pledged most of its industrial assets to get working capital for its turn around plan, so tough decisions regarding asset sales may be inevitable. It's not clear how much cash would actually realize if it sold Volvo. According to Edmunds.com, Volvo was one of the assets that Ford pledged to get the working capital. The mortgagee would seem to have the upper hand in negotiations to remove the security interest over the Volvo assets.
Volvo is more than just a niche marketer of "boxy but good", safe European cars, Volvo engineering contributes to most of Ford's design. The Ford Five Hundred/ (new) Taurus and Freestyle ride on a Volvo platform. If you take away the Volvo-engineered cars, and the Mazda-derived cars including the Fusion/Milan/MKS and Focus, it doesn't leave much in the way of passenger cars, just the niche market Mustang and the ancient but vanishing Crown Vic. As much as Ford likes to complain about the cost and productivity of the UAW members, it seems that Ford is getting much less productivity out of its engineering employees. Other than the Mustang and its organ donor the Lincoln LS, I can't think of a single new-from-the-ground-up passenger car that Ford has engineered in the United States and introduced in the past 10 years. All those engineers can't be working on trucks, can they?
It's Confirmed - Delphi Dropping Legal Services
Thanks to Paul C., Ken W. and Steve B., I just received a copy of the UAW-DELPHI-GM Memorandum of Understanding Delphi Restructuring. Delphi is clearly dropping the UAW-Delphi Legal Services Plan effective October 1st. Here's the language in page 18 of the document:
It couldn't get any clearer.
What are the odds of the FB3 (formerly big three) automakers dropping the legal services when their contracts come up in the fall? Who knows? I'd say the odds are against it, but not overwhelmingly so. Let's look at the timing precedent. The UAW ratified the Delphi deal at the end of June for an October 1 benefit end. That's a 4 month lead time. I would hope that we'd have at least that much lead time before a FB3 program termination.
FYI, if you are a UAW-LSP staff attorney in an office that primarily serves Delphi employees, please send me a private e-mail letting me know how the announced ending of legal services has affected your office. Let me know whether you want me to post your letter or not.
Thanks to Paul C., Ken W. and Steve B., I just received a copy of the UAW-DELPHI-GM Memorandum of Understanding Delphi Restructuring. Delphi is clearly dropping the UAW-Delphi Legal Services Plan effective October 1st. Here's the language in page 18 of the document:
3. Existing CHR/Legal Services
The Parties agree as follows:
a. As of October 1, 2007, all Delphi funding and participation in the
Legal Services Plan (Attachment I to the 2003 UAW-Delphi
National Agreement) and all programs associated with the UAWGM
Center for Human Resources (CHR) will be terminated.
Discussions about any joint programs to be continued, and the
method for their administration at the local level in the absence of
the CHR, will be a matter of Local Negotiations.
It couldn't get any clearer.
What are the odds of the FB3 (formerly big three) automakers dropping the legal services when their contracts come up in the fall? Who knows? I'd say the odds are against it, but not overwhelmingly so. Let's look at the timing precedent. The UAW ratified the Delphi deal at the end of June for an October 1 benefit end. That's a 4 month lead time. I would hope that we'd have at least that much lead time before a FB3 program termination.
FYI, if you are a UAW-LSP staff attorney in an office that primarily serves Delphi employees, please send me a private e-mail letting me know how the announced ending of legal services has affected your office. Let me know whether you want me to post your letter or not.
Monday, July 09, 2007
Walletboy Returns DRAFT
I just got back from a whirlwind two-week East Coast tour, playing including playing Walletboy on Broadway. The auto industry didn't sleep while I was away. I'll get to as much as I can before I fall asleep. I may have to add links later.
Delphi & UAW Agree to Cut Legal Services
The Delphi deal closed. The UAW agreed to give Delphi a two-tier wage structure, and the new contract eliminates legal services benefits. There are significant healthcare copays, and the pension plan is changed to a 401k. The Delphi contract imposes a new wage scale from $14.00 per hour for new hires to $18.50 for old hands. GM agreed to subsidize the wages of holdovers for up to 3 years. Still, within three years, through plant closings and attrition, the UAW presence at Delphi is expected to be cut by about 7/8, from 17,000 UAW workers now to 2306 in 2012.
In fact, Delphi intends to only keep open four UAW plants: Kokomo, Indiana; Lockport, New York, Rochester, New York, and Grand Rapids, Michigan. I'm still trying to get confirmation whether elimination of the legal services benefit is part of the new contrac,t but even if the legal services benefit is retained, the closing of Delphi plants will likely mean the closure of several UAW-LSP offices, and a shuffle in others as seniority rights result in bumping.
Allison, GM's Aim was True
GM sells Allison Division to Private Equity firms.
On June 28, General Motors announced that it was selling its Allison Division to a private equity consortium lead by Carlyle Group and Onex Corp. The Allison division had its roots in racing Indy Cars. By the end of the 1920s, Allison was big with the military in making things that go. In recent years, medium and heavy duty truck transmissions as well as tank transmissions have been Allison's main forte. The Allison operations in Indianapolis that employ 3,400 will go to the buyers. GM will keep the part of Allison that makes hybrid truck transmissions in Baltimore, Maryland. GM will receive $5.4 billion in the deal, but it will lose another of its profitable enterprises. (Source (among others) Businessweek
Cerburus & Chrysler Deal appears to be Final
All of the international government approvals of DCX's agreement to sell Chrysler Division to Cerberus Financial appear to have gone through. A third quarter closing will make the deal official. Until then, all Chrysler product plans and personnel plans appear to be in limbo.
Bankrupt Supplier Dana Corp is setting up a deal to transfer retiree healthcare obligations to the UAW.
GM June Sales plung 21% - New products aren't helping much.
General Motors announced that its sales dropped 21% in June 2007 compared to June 2006. GM may try to sugar coat these figures, saying that sales in 2006 were inflated by loss-leading sales incentives. Robert Farago, author of the GM Deathwatch at thetruthaboutcars.com isn't buying it, pointing out that sales plunged also compared to May 2007, and comparative sales of its import-brand rivals posted double-digit increases. GM's market share is now down to 21%. Toyota's is up to 16.9%.
GM has touted several new models as its saviours. Unfortunately, these models are looking to have very short legs in the sales race. The most important models, the half-ton pick-up trucks, haven't improved GM's truck sales overall, in fact, they trail last year's pace by more than 20%. Saturn benefited the most by new products, with the Aura and the Outlook. Believe it or not, the Outlook actually received a glowing report by noted-GM hater, Consumer Reports.
What's coming up in the GM pipeline for 2008? Answer: not much. Or, should I say not much in the way of volume sellers. There's the new Saturn Vue that is already starting to hit the dealers. It's a direct competitor in the already overcrowded two-row sport CUV market. The new Cadillac CTS looks to be promising, but the segment is small, and there are lots of excellent competitors. In the family sedan market, Chevrolet gets a new Malibu. the problem is that the 2008 Malibu is a platform-mate of the Aura and Pontiac G6. The Aura and G6 aren't bad vehicles, but they haven't had enough of the right stuff to keep GM from augering in.
What do the competitors have? First and foremost, Honda will have a brand new Accord. Toyota has a new Highlander that has GM's new crossovers in its crosshairs. Hyundai is refreshing its two-year-old Sonata. Also, word-of-mouth has been building about Hyundai's crossovers. Mazda will be showing a new Mazda6, though it's not clear to me whether it will make a fall introduction. Ford's Taurus (formerly Five Hundred) should finally have the guts to take sales away from GM's larger sedans.
I just got back from a whirlwind two-week East Coast tour, playing including playing Walletboy on Broadway. The auto industry didn't sleep while I was away. I'll get to as much as I can before I fall asleep. I may have to add links later.
Delphi & UAW Agree to Cut Legal Services
The Delphi deal closed. The UAW agreed to give Delphi a two-tier wage structure, and the new contract eliminates legal services benefits. There are significant healthcare copays, and the pension plan is changed to a 401k. The Delphi contract imposes a new wage scale from $14.00 per hour for new hires to $18.50 for old hands. GM agreed to subsidize the wages of holdovers for up to 3 years. Still, within three years, through plant closings and attrition, the UAW presence at Delphi is expected to be cut by about 7/8, from 17,000 UAW workers now to 2306 in 2012.
In fact, Delphi intends to only keep open four UAW plants: Kokomo, Indiana; Lockport, New York, Rochester, New York, and Grand Rapids, Michigan. I'm still trying to get confirmation whether elimination of the legal services benefit is part of the new contrac,t but even if the legal services benefit is retained, the closing of Delphi plants will likely mean the closure of several UAW-LSP offices, and a shuffle in others as seniority rights result in bumping.
Allison, GM's Aim was True
GM sells Allison Division to Private Equity firms.
On June 28, General Motors announced that it was selling its Allison Division to a private equity consortium lead by Carlyle Group and Onex Corp. The Allison division had its roots in racing Indy Cars. By the end of the 1920s, Allison was big with the military in making things that go. In recent years, medium and heavy duty truck transmissions as well as tank transmissions have been Allison's main forte. The Allison operations in Indianapolis that employ 3,400 will go to the buyers. GM will keep the part of Allison that makes hybrid truck transmissions in Baltimore, Maryland. GM will receive $5.4 billion in the deal, but it will lose another of its profitable enterprises. (Source (among others) Businessweek
Cerburus & Chrysler Deal appears to be Final
All of the international government approvals of DCX's agreement to sell Chrysler Division to Cerberus Financial appear to have gone through. A third quarter closing will make the deal official. Until then, all Chrysler product plans and personnel plans appear to be in limbo.
Bankrupt Supplier Dana Corp is setting up a deal to transfer retiree healthcare obligations to the UAW.
GM June Sales plung 21% - New products aren't helping much.
General Motors announced that its sales dropped 21% in June 2007 compared to June 2006. GM may try to sugar coat these figures, saying that sales in 2006 were inflated by loss-leading sales incentives. Robert Farago, author of the GM Deathwatch at thetruthaboutcars.com isn't buying it, pointing out that sales plunged also compared to May 2007, and comparative sales of its import-brand rivals posted double-digit increases. GM's market share is now down to 21%. Toyota's is up to 16.9%.
GM has touted several new models as its saviours. Unfortunately, these models are looking to have very short legs in the sales race. The most important models, the half-ton pick-up trucks, haven't improved GM's truck sales overall, in fact, they trail last year's pace by more than 20%. Saturn benefited the most by new products, with the Aura and the Outlook. Believe it or not, the Outlook actually received a glowing report by noted-GM hater, Consumer Reports.
What's coming up in the GM pipeline for 2008? Answer: not much. Or, should I say not much in the way of volume sellers. There's the new Saturn Vue that is already starting to hit the dealers. It's a direct competitor in the already overcrowded two-row sport CUV market. The new Cadillac CTS looks to be promising, but the segment is small, and there are lots of excellent competitors. In the family sedan market, Chevrolet gets a new Malibu. the problem is that the 2008 Malibu is a platform-mate of the Aura and Pontiac G6. The Aura and G6 aren't bad vehicles, but they haven't had enough of the right stuff to keep GM from augering in.
What do the competitors have? First and foremost, Honda will have a brand new Accord. Toyota has a new Highlander that has GM's new crossovers in its crosshairs. Hyundai is refreshing its two-year-old Sonata. Also, word-of-mouth has been building about Hyundai's crossovers. Mazda will be showing a new Mazda6, though it's not clear to me whether it will make a fall introduction. Ford's Taurus (formerly Five Hundred) should finally have the guts to take sales away from GM's larger sedans.
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