This is why our manufacturing went overseas.

a1abdj, i didn't understand your numbers to get to 93k.

if labor goes up about 3k, why wouldn't the cost go to 78k ?

you seemed to add 11,250 back in twice?

He took the new labor cost, $14,062.50, and divided by the original 15% the old labor cost represented in the MSRP of the truck.

Unless all other costs and amounts that make up MSRP are truly fixed percentages based on labor cost alone, his calculation artifically inflates all the other costs and amounts that make up MSRP.

A better method would be to take the incremental increase in labor costs and add Ford's planned profit then the dealers planned profit. If ford l
ans to make 20% a d the dealer plans to make 20% then the incremental increase in MSRP would be $2,812.50×1.2×1.2=$4,050, so the $75,000 truck now becomes a f79,050 truck.

quote:

Unless all other costs and amounts that make up MSRP are truly fixed percentages based on labor cost, his calculation artificially inflates all the other costs and amounts that make up MSRP.

Costs are variable. They don't all rise, or fall, together or at the same rate.
However, Bidenflation is driving high costs across the board.
Actually, it's devaluing the dollar, making everything more expensive.

quote:

his calculation artifically inflates all the other costs and amounts that make up MSRP.

That's true, but it's a pretty good assumption that due to inflation, other wages that will be driven up, and other factors that those costs will also increase.

The labor costs of roughly 15% of the price of a vehicle has been a pretty steady number over time. If you think that the increase cost of the paychecks they are writing to labor will be the only thing that adds to the price of the car, the total number would be roughly a 6% increase to the price.

I wouldn't hold my breath on that being the case. I also don't understand those who think that these manufacturers are so profitable that they'll simply eat the difference.

I'm not in the automotive business, but I can tell you that when my labor costs increase so does everything else (although perhaps in slightly different order).

Some are variable, others are fixed, some are a mix in a continuing operation. I don't know of any manufacturing business that costs out their materials cost as a function of their labor costs.

This article says that there is agreement between the UAW and GM is that labor component makes up is 5% of the vehicle.

Edited to read GM

--K

https://www.wxyz.com/money/aut...the-strike-in-day-29

quote:

Originally posted by a1abdj:

That's true, but it's a pretty good assumption that due to inflation, other wages that will be driven up, and other factors that those costs will also increase.

The labor costs of roughly 15% of the price of a vehicle has been a pretty steady number over time. If you think that the increase cost of the paychecks they are writing to labor will be the only thing that adds to the price of the car, the total number would be roughly a 6% increase to the price.

I wouldn't hold my breath on that being the case. I also don't understand those who think that these manufacturers are so profitable that they'll simply eat the difference.

I'm not in the automotive business, but I can tell you that when my labor costs increase so does everything else (although perhaps in slightly different order).

Inflation is a different story.

One could argue that the $75,000 you started with already includes the effects of inflation on raw materials, plant operations, utilities, managerial wages, etc. and this deal with the union brings the labor costs back up to the traditional 15% labor represented of the total. Vehicle prices have gone up in the last five years while the labor rates have remained unchanged until now. That means labor's percentage of the total was lower in the last five years than it has been in the years before that.

I don't believe for a second that the manufacturers will eat these costs, they can't.

https://www.fidelity.com/news/...ED_KBN31X1PH-OUSBS_1

UAW gears up to organize Toyota, other nonunion automakers

DETROIT/WASHINGTON (Reuters) - Leaders of the United Auto Workers signaled the next step in their campaign to capitalize on the union's success in bargaining with the Detroit Three: launching organizing drives at Toyota ( TM ), Tesla and other nonunion U.S. auto factories.

"What could @Toyota ( TM ) workers win if they joined the #StandUpUAW campaign?" UAW organizing director Brian O. Shepherd posted on social media on Wednesday, commenting after Toyota ( TM ) agreed to boost wages for U.S. workers by 9%, and to cut in half the time it takes new hires to reach the top pay rate.

Other foreign automakers are reviewing recent auto-sector wage hikes. Honda ( HMC ) told Reuters it is evaluating the recent UAW deals with the Detroit Three automakers and will remain competitive.

cont...

quote:

UAW gears up to organize Toyota, other nonunion automakers

Yeah, ain't gonna fly in the South.

quote:

Originally posted by chellim1:

quote:

UAW gears up to organize Toyota, other nonunion automakers

Doesn't matter if they don't, the wage increases at the big three in the USA are going to force Toyota and the others to increase pay, as are other industries, wages are going up because costs are going up, costs are going up because wages go up, it's the vicious cycle of inflation. Welcome to Carter 2.0

Link

Toyota Wages and the Ford Maverick Show the Effects of UAW Talks

https://www.fidelity.com/news/...ED_KBN3281KN-OUSBS_1

Stellantis offering buyouts to about half its US salaried employees

(Reuters) -Chrysler-parent Stellantis ( STLA ) said Monday it is offering 6,400 U.S. salaried employees voluntary buyouts as it works to cut costs amid the transition to electric vehicles and agreeing to a new United Auto Workers contract.

The buyouts would be about half the company's salaried U.S. employees not represented by a union, which is currently 12,700. Another 2,500 Stellantis U.S. salaried workers are unionized and are not being offered the current buyout.

Salaried employees must have at least five years of experience to be offered a voluntary departure package. Employees agreeing to take the incentive would depart before the end of December.

Stellantis ( STLA ) said it was taking "necessary structural actions to protect our operations and the company" and cited preparations "for the transition to electric vehicles."

In April, Stellantis ( STLA ) said it was offering voluntary exit packages to 33,500 U.S. employees. That offer covered 31,000 U.S. hourly workers and about 2,500 salaried workers. It is also offered some employees in Canada voluntary buyouts.

Stellantis ( STLA ) Chief Operating Officer Mark Stewart told employees in April a review of its operations "has made it clear that we must become more efficient."

In October 2022, Stellantis ( STLA ) offered voluntary buyouts to its U.S. salaried employees who were aged 55 or older and had worked for the automaker at least 10 years.

Under the UAW contract, the company agreed to offer $50,000 buyouts for veteran production and skilled trade members. It will offer buyouts in 2024 and 2026.

Stellantis ( STLA ) said on Oct. 31 it would seek to offset a significant financial hit from strikes in North America that led to big pay increases and was looking at potential cost cuts.

Stellantis CFO Natalie Knight said the six-week strikes were unexpectedly long and would cost the group in the full-year 2023 less than 750 million euros ($800 million) in terms of profitability and around 3 billion euros in terms of revenue.

Stellantis ( STLA ) did not provide estimates on extra labor costs it will have to bear in the future, following new agreements with unions in North America.

https://www.fidelity.com/news/...ED_KBN3281NE-OUSBS_1

UAW president vows aggressive auto plant organizing -Senate testimony

WASHINGTON (Reuters) - United Auto Workers President Shawn Fain will tell a Senate Committee on Tuesday the union plans to aggressively organize non-union U.S. auto plants after winning new contracts with the Detroit Three automakers.

"For decades, non-union auto companies have used fear, uncertainty, and division to break union drives in our industry," Fain will tell the Senate Health, Education, Labor and Pensions Committee, according to written testimony seen by Reuters. "I'm here to promise you that those days are over.... We are going to organize like we've never organized before."

The UAW for decades has unsuccessfully sought to organize auto factories operated by foreign automakers.

Hyundai Motor said on Monday it will hike wages for nonunion U.S. production workers by 25% by 2028, weeks after the UAW won new contracts with General Motors ( GM ), Ford Motor ( F ) and Chrysler parent Stellantis ( STLA ).

The Korean automaker joins Toyota Motor ( TM ) and Honda Motor ( HMC ) in raising U.S. factory wages after the UAW won a new contract that will result in wage increases of 25% through 2028 and other benefits.

"We know these non-union companies are doing this because they're scared," Fain's testimony says. "They're scared that their workers will see that a better life is possible once they organize into a union. And these companies are trying to head that off."

The hearing will also include testimony from Teamsters President Sean O'Brien and Association of Flight Attendants President Sara Nelson.

Nelson's testimony also cited Honda's ( HMC ) wage hikes.

"If non-union firms want to attract and retain qualified workers, they must compete with the unionized workers' pay, benefits and working conditions," her testimony says. "The more of us who are unionized, the more pressure all employers face."

When U.S. President Joe Biden visited Illinois last week, he said he backed the UAW's efforts to unionize Tesla and Toyota ( TM ), adding that all U.S. auto workers deserve a deal similar to the UAW's recent agreements with the Detroit Three.

Locals are voting no on these contracts. Mack trucks is pushing back.

Greedy assholes. I hope they replace you all.

UAW is feeling all frisky now. They’re after Volkswagen again - for the 3rd time. I guess they can just keep coming if they want.

They claim “our time is now” Of course, the first thing they do is file a complaint with the NRLB claiming Volkswagen is being unfair.

What I think of this would get me banned from the internet

https://www.reuters.com/busine...ards-uaw-2023-12-07/

https://www.local3news.com/loc...75-c7106e00bee0.html

quote:

Originally posted by Tn226:
UAW is feeling all frisky now. They’re after Volkswagen again - for the 3rd time. I guess they can just keep coming if they want.

Volkswagen would welcome unionization, it's the way it's done in Germany, they were backers of the last attempt by a small faction in the TN plants to Unionize that the workforce didn't approve.

My BIL is starting the shopping process for a new car and expressed shock at me the other night how much cars cost these days.

Told him "Someone's gotta pay for those fat raises and benefits!"

quote:

Originally posted by HRK:

Volkswagen would welcome unionization, it's the way it's done in Germany, they were backers of the last attempt by a small faction in the TN plants to Unionize that the workforce didn't approve.

Not according to a senior manager I know. He says while it’s accepted in Germany it’s in no way welcome here. Yes there are some local German managers who would be ok with it, but they’re by far the minority. It’s most certainly not popular with VW corporate. He also says working with the German union isn’t combative like it is with the UAW

quote:

Originally posted by Tn226:

quote:

Originally posted by HRK:

Volkswagen would welcome unionization, it's the way it's done in Germany, they were backers of the last attempt by a small faction in the TN plants to Unionize that the workforce didn't approve.

Not according to a senior manager I know. He says while it’s accepted in Germany it’s in no way welcome here. Yes there are some local German managers who would be ok with it, but they’re by far the minority. It’s most certainly not popular with VW corporate. He also says working with the German union isn’t combative like it is with the UAW

Interesting in that many articles at the last organization attempt in 14 mentioned that VW Germany was interested in unionization. The employees didn't want it, since Unions are viewed by many as one of the primary reasons for exported jobs and failure in American plants.

Agree that they see Unions differently and haven't had to deal with strong arm thug Unionization that has been the methodology of the UAW, Teamsters etc

Link

quote:

The four-year-old Volkswagen plant in Tennessee was supposed to be an opening: The company was actually eager to work with the union, since it prefers to negotiate with an organized workforce. But in February, workers narrowly defeated the UAW, forcing Volkswagen to look for another option.