Episode 600 – UAW Prepares to Bargain, Turbos to Double in U.S., Ghosn’s Apology Not Enough

March 16th, 2011 at 12:00pm

Runtime 7:29

The United Auto Workers union is holding a convention next week to determine its bargaining strategy with GM, Ford and Chrysler in order to win concessions back. Auto supplier Honeywell predicts that the number of cars equipped with turbochargers will double in the U.S. by 2015. Carlos Ghosn apologized for the whole Renault espionage scandal but that might not be enough for the French government which is the company’s largest shareholder. All that and more, plus John answers your questions about Alan Mulally, Chris Liddell and much more in the “You Said It!” segment.


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This is Autoline Daily for March 16, 2011. And now, the news.

The United Auto Workers union is holding a convention in Detroit next week to determine its bargaining strategy with GM, Ford and Chrysler. The Detroit Free Press reports that the union wants to win concessions back. Union president Bob King says workers gave up between $7,000 and$30,000 in concessions over the last decade, and they want that back. Here’s my Autoline Insight. The union is going to have to tread very carefully. Most Americans believe the union played a major role in the collapse of the Big Three. It’s highly unlikely the UAW will win concessions back, but it has a very good chance of getting lucrative profit-sharing agreements with the automakers. Also, in January Bob King said he would announce by the end of the month which foreign automaker the union would go after to organize. Well, here it is, mid-March, and we haven’t heard peep from the union on this issue. Clearly, Bob King has had his hands full fighting what he sees as anti-union efforts in Wisconsin, Ohio and Michigan. But it sounds like the union is falling behind in its efforts to go after the transplants.

Here’s an update on the catastrophe in Japan. According to Gasgoo, joint-venture automakers in China are worried about parts shortages, as are other companies and suppliers. The Detroit News reports semiconductors are one piece of the supply chain that’s particularly vulnerable. Japan accounts for about 22 percent of the global market for these high-tech components. Power outages and seismic activity are very disruptive to semiconductor manufacturing. On the bright side, Toyota, Nissan, Denso and others should start reopening factories next week.

Buick has been upgrading its product portfolio the last few years, and doing a very nice job of it. Now the brand feels it’s the right time to upgrade its image as well. Starting with this week’s March Madness basketball tournament, Buick is launching a new ad campaign that will be tough to miss. For the the next 21 days it’ll be on television, print, social media and even the NCAA website. Get this, Buick expects to get about one billion impressions! If you want to change your image quickly that’s one way to do it.

When you think of emerging markets, countries like China, India and Brazil come to mind, not the U.S. However, auto supplier Honeywell considers the U.S. as an emerging region in terms of turbochargers. According to Bloomberg the company, which is the world’s largest maker of turbos, predicts that the number of cars equipped with them will double, from 9 percent today to around 20 percent by 2015. Honeywell believes they will become more popular due to the stricter fuel economy mandates.

Carlos Ghosn’s apology for the whole espionage scandal might not be enough. Some members of the French government say they “cannot let this pass” that they’ll “get to the bottom of who was responsible.” But as of now they haven’t discussed Ghosn’s resignation. The French government is Renault’s largest shareholder, with a 15 percent stake.

What do you do when big corporations won’t listen? You shout loud enough for them to hear! One very angry Lamborghini owner in China DEMONSTRATED his dissatisfaction with the company by publicly SMASHING his Gallardo yesterday, which also happened to be “World Consumer Rights Day.” China Car Times reports the disgruntled driver did it to prove to the world that Chinese consumers deserve the same level of service as others. Why would he do such a thing to a six-month-old car that cost more than half a million dollars? Well, last November the Lambo wouldn’t start. The dealer hauled it away and attempted to fix the issue. It failed and in the process damaged the bumper and parts of the chassis. Yeah, I’d be pissed too. The owner complained to said dealer, contacted the brand’s China headquarters, the service manager for Lamborghini’s Asia-Pacific region, the company CEO and even the Volkswagen Group! But no one would listen. He figured destroying the car was the ultimate way to show his dissatisfaction. Something tells me Lamborghini will hear him now.

Coming up next, it’s time for You Said It!

And now it’s time for some of your feedback.

Mike G. wrote in to say, “If folks are not happy with Alan Mulally’s pay for performance, I’m sure Ford could hire back Jacques Nasser, then the whiners would see that Mulally EARNED every penny.”

No question. Alan Mulally deserves every penny they give him.

C-tech wants to know, “Why would the CFO, Liddell, leave GM now? I can’t imagine quitting without lining up your next position. Is there a CFO job fair coming up?”

C-tech, it’s simple. Liddell left Microsoft to go to GM because they told him he might become CEO. When they passed over him to go with Dan Akerson, Liddell said, “I’m outta here.”

pucus21, is wondering, “Why does Ford not want to bring the Mondeo to the U.S.???”

Pucus, they will bring the Mondeo to the U.S., except that they’re going to call it the Fusion.

Rajgokulraj is disgusted with the video we use to cover our stories on India. “Guys, I am repeating again…for God’s sake please get a new video about India. All the cars that you show in the video are no more in India. We don’t have those man driven 3 wheelers in India!! Please don’t embarrass us!!“

Raj, we don’t want to embarrass you, so we’ll get other video. But give us some time. It’s not as easy as you might think.

Jim has a point of contention on our coverage of the earthquake in Japan. He says, “Small point, John, but I think you mean “tremor” and not “tremblor,” which I don’t think is an actual word.”

Jim, actually I said “temblor,” not “tremblor,” and temblor is a word that means earthquake. It comes from the Spanish word for earthquake, but is commonly used in English as well.

Bob in Atlanta says, “I saw an Oscar Mayer Wienermobile in Knoxville a few weeks ago – it was a converted Mini. They must be using it to promote their cocktail wieners.”

Bob, at first I thought you were making this up, but I went online and sure enough, there is a Wienermobile based on the Mini.

And that brings us to the end of today’s report on the top news in the global auto industry. Thanks for watching, we’ll see you tomorrow.

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30 Comments to “Episode 600 – UAW Prepares to Bargain, Turbos to Double in U.S., Ghosn’s Apology Not Enough”

  1. HtG Says:

    I have the reverse problem from that Lambo whiner in China. Our local Nissan dealer’s service department just can’t stop pouring on the hospitality. Their waiting area has fresh bagels, coffee, newspapers, large screen TV, wifi, shuttle service, and one of the managers hits on me!

    You’re not going to see me pounding our car in the tailpipe, but sheesh,…basta, baby,…basta!

  2. pedro fernandez Says:

    One side effect of this terrible disaster might bring another: Honda and Toyota parts being made in China under the same substandard way they build every thing else.

  3. JRG Says:

    It’s nice that the UAW wants concessions that were given back but first I like to see the UAW quit protecting the lazy workers that cause my spouse to rant for hours after getting home about the lazy SOB’s at work.

  4. Lex Says:

    The Japanese earthquake might get Toyota or one of the other Japanese auto manufactures to consider setting shop in the Numme Manufacturing Plant abandoned by Toyota and GM in California.

    When will the new Chevy Impala and Caprice be brought to the US from Holden in Austrialia?

    Why is the flow of GM vehicles and technology flowing from Down Under (Austrailia) to Up Top (North America) and not the other way around?

  5. pedro fernandez Says:

    Lex, also West-bound from Europe as in the case of Malibu, Cruze and others, we seem to be only developing trucks and SUV’s

  6. Tom L Says:

    John.Re: Japan
    What is happening to the car companys employees?
    Are they getting paid?

  7. paulstewart Says:

    In 2012 the new Chevy Malibu will be sold, as well as the new Chevy Impala in late 2013 as a 2014 model.

  8. Chuck Grenci Says:

    John, I respectfully disagree; no one is worth 50 plus million for anything, anywhere, anyhow. I will agree that Mulally is at the top of the heap and at the top of his game (but salary(s) of some of these guys is, and remains, ludicrous. No, I am not professing a salary cap, just a little sense in this wacko world of compensation.

  9. G.A.Branigan Says:

    Th’ good ol uaw……again,still,yawnnn.I say give in to the uaw’s every wish and demand.When the company goes belly up,so does the uaw,end of problem.

  10. G.A.Branigan Says:

    Here’s a thought: how about the big three give us American consumers a choice.We could buy a union made ford/dodge/chevy,or a non-union made ford/dodge/chevy.Let the end consumer make the choice and see how that goes.

  11. HtG Says:

    How much of what UAW leadership does is a show for the more militant within the rank and file? Are we just watching opening moves in a negotiation that ends up with a compromise and Bob King more firmly in charge? I remember only Nixon could make peace with China.

    Or are we really just going down tubes again?

  12. len simpson Says:

    Yeah, UAW, win your concessions back,drive the rest of our fsctories offshore.
    Dear O , save what’s left! end closed shops, return the union campaign funds! Campaign funding is the cornerstone of government deceit.

  13. Mickey Says:

    Since there is all of this talk of new products being released, I was wondering if there is any hope for a public-market Chevrolet Caprice. Just something that I have been kicking around in my head for sometime.

  14. SalvadorG. Says:

    Ah! man, this is the kind of thing that Youtube was invented for… oh! wait, here’s the link.

  15. pedro fernandez Says:

    GA I remember the old Taurus had a sticker in the windshield stating: proudly built in a UAW factory in Ga. I believe, they put point of origin in the stickers but I doubt anyone reads it. How about dealers that remove the factory sticker completely and put in their own, I’d walk away from any such dealer.

  16. cwolf Says:

    It’s that time again for both sides to strike a bargain from a position of strength,but in the end I have a hunch a reasonable compromise will be reached.I expect money to remain close to where it is, maybe a couple holiday perks or something simular and profit sharing. Profit sharing,if individual performances are included in them, should give some relief to(#3) JRG’s wife and me. Would love to eliminate “dead wood”,but this still only lies in the hands of management.Yet one should remember US union labor IS completely in line with world wages!Given this, Branigan’s comments pretty much amounts to nothing but HOT AIR. Thinking about shoddy UAW work,Branigan? Don’t think the majority of recalls over the past year are from a union manufacturer. The US does have a number of electronic issues with its vehicles, but guess who prolly makes them,..(hint)not the US or the UAW?
    I appologize to all others for my rant towareds someone who remains blinded by past blunders.
    I think it is scary what all is happening in the US. The thought of a diminishing middle class is daunting! Our car products are much better and competitive. Like the Japanese, we must start believing in ourselves and our manufacturing abilities.

  17. pedro fernandez Says:

    but when you got American car makers building in Mexico and Canada and passing it off as American-made, I have a problem with that. My Corolla was built in California by UAW workers but it’s considered a foreign car.

  18. XA351GT Says:

    They should go to profit sharing. If the company is doing well all should benefit and when it’s bad they all suffer equally. Problem union greed has proved time and time again that they are never satisfied.

    Here’s a shining example the NFLPA has decided that no money is better than settling for a little less. They want to see the owners books and whatever. A lot of these owners are ponying up the money for these huge stadiums . Now they probably aren’t losing money ,but the name of the game is to make money. They are responsible for the salaries they bitch about by outbidding one another for the services of these players so in a way they are their own worst enemy.

  19. XA351GT Says:

    To the owner of that Lambo ,you sir are a jackass. Do you really think they care ,you already paid for the car. Your insurance won’t cover the damage so WHO did you really hurt? If someone has the money for a Lambo they aren’t going to care that you smashed yours because you were a unhappy child. You’ve already proven you have more money than brains.

  20. XA351GT Says:

    Pedro, Mexico and Canada are part of (North) America so saying they are American made isn’t a complete lie. Misleading maybe .but maybe instead of saying made in America they should say US of A.

    Reminds of the story that Japan named a city USA so they could fool people back when the backlash was against Japan like it is now with China and Mexico. I have no idea if that story is true ,but it is within belief.

  21. G.A.Branigan Says:

    @ cwolf: I’m not going this road again.I have my new chevy…so what.At least I consistently buy American,or as close to it as possible.As for the uaw,lmao.

  22. HyundaiSmoke Says:

    I love Chinese cars, because China is the New Japan, and Korea is the New Germany.

    Stupid BMWs and Toyotas.

    If America doesn’t truly change they will become the new ENGLAND!!! The Yanks still have one foot in the door of New Change, and one foot in the door of “Business as usual.”

    Chinese Cars for America!!! Built in America by Americans!!! :D

  23. miko privat Says:

    Regarding the Unions… as long as American cars can compete with the japanese and germans in regards to cost, quality and performance, both the CEOs and the UAW workers can and should earn respectable salaries.
    At this moment in time American manufacturers not only compare but also supersede the requirements enumerated above at lower prices than the asians and europeans

  24. HyundaiSmoke Says:

    HHR needs a Cruze engine, guys!!

    Come on, stop being silly.

  25. HyundaiSmoke Says:

    Give em an option of one.

    I bet you’ll steal from Japan like that.

  26. Mohammad Rafi Says:

    Best. Episode. Ever.

  27. pedro fernandez Says:

    But these jobs are not being done by AMericans, and since American taxpayers bailed out these two, the least they could do is assemble their cars here. Dont want UAW, set up in a right to work state, then. Sorry Canadians and Mexicans are not US citizens or taxpayers.

  28. JC Says:

    Isn’t the whole Canadian and Mexican thing a bit overstated? What percentage of the “Detroit 3″ assembly plants are outside of the US? I don’t have data for all, but in the case of Ford, it seems reasonable to me (9 US assembly plants, 2 Mexican, 2 Canadian). If you want to include all major component or assembly plants, it’s 26 US, 3 Mexico, 4 Canadian. And it’s not like there has been a shift away from the US. The last new plant outside of the US was 1986, while the last new plants in the US were 1987 (AAI in Flat Rock) and 2004 (Dearborn Truck). In the case of Canada, they have had one plant close in the last several years, and another is on the chopping block, so they certainly aren’t benefiting from US outsourcing. Perhaps the numbers are different for GM and Chrysler.

    I certainly don’t knock foreign automakers from building more in the US, but I just don’t seem them on par with the “Detroit 3″. And note that this analysis doesn’t even consider the thousands of corporate staff which is primariy based in US.

  29. pedro fernandez Says:

    This area must really be anti-Fiesta, I see new Cruze every single day, yet NO Fiestas at all. I think the current outgoing Focus is taking sales away from it

  30. pedro fernandez Says:

    if they wanted to avoid UAW just move to Southern states like the transplants, but at least you’d be employing Americans and providing all the benefits that go along with a thriving workforce.