Episode 909 – UAW Targets Nissan, Chinese Cars Add Up, Renault Launches Car Sharing Program

June 12th, 2012 at 11:40am

Runtime: 6:19

The UAW in its latest attempt to unionize a foreign owned auto plant is targeting Nissan’s U.S. factories. Reports are rolling in about legions of unsold cars in China, with factories and dealers reporting different numbers and extra inventory making up the difference. GM and DOW recently earned grants from the DOE for their work in die-casting and carbon fiber respectively. All that and more, plus a look at the Infiniti EX 35.

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Welcome to Autoline Daily for June 12th. I’m John McElroy and here’s the news.

UAW TARGETING NISSAN
The UAW is making another run at trying to organize Nissan’s factories in the U.S. The union points out that Nissan workers in Tennessee earn $1.50 an hour more than their counterparts in Mississippi. It’s also accusing Nissan of racial bias, saying that most the workers in Tennessee are white, while most of those in Mississippi are black. The NAACP is also criticizing Nissan. But here’s my Autoline Insight. Nissan pays far better wages than those workers could find in any jobs in their surrounding area. And the UAW failed spectacularly in two previous attempts to organize Nissan. So it seems highly unlikely the union will prevail this time.

UNSOLD CHINESE CARS LINGER ON LOTS
We keep getting reports out of China that inventories of unsold cars are piling up. And yet automakers are reporting strong sales. Here’s how to explain the disconnect. Automakers are reporting wholesale deliveries, that is, cars they’re selling to dealers. The dealers are reporting retail sales, to actual customers. But if they can’t move the metal, at some point soon the dealers will have to stop taking wholesale deliveries and the assembly lines will slow down. We’re going to have to keep an eye on this one.

GM, DOW EARN DOE GRANTS
General Motors and Dow Chemical just got grants from the U.S. Department of Energy. GM received $2.7 million to develop a die-casting process for door production that will reduce energy use during manufacturing by 50% and also cut the weight of doors. Dow got $9 million to work on a new carbon fiber manufacturing process that could cut costs by 20%. Dow is working with Ford on carbon fiber applications, and other automakers such as Toyota and BMW are also making big commitments to using carbon fiber.

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BATTERY TECH GETS HOT
Battery supplier A123 Systems says it has a breakthrough in battery technology that will reduce the need for battery cooling systems and cut the cost of battery packs. Batteries using the technology can maintain 90% of their initial capacity after 2,000 charge cycles at 113 degrees Fahrenheit or about 45 degrees Celsius. A123 says a German automaker will use the new battery starting next year but it won’t say who. Interestingly A123 says it is now focusing more on selling its electric grid storage products because demand for EVs is weak.

RENAULT DEBUTS CAR SHARE PROGRAM
Renault will become the first automaker to launch its own car sharing program when it debuts its Twizy electric car June 21st. The test program allows users to search for cars on their smartphones and reserve them up to 15 minutes in advance. There will be no fixed pick up or drop-off points in the test program, users will instead leave their cars in regular parking garages.

BUICK VERANO GETS TURBO’D
Buick is adding a turbocharged model to its Verano line for 2013.  The 2-liter, force-fed engine will produce 250 horsepower and reach 60 miles per hour in 6.2 seconds. It will also deliver about 30 miles per gallon on the highway.

Coming up next, we’ll take a look at the new Infiniti EX35.

2012 INFINITI EX 35
(The Infiniti EX 35 review is only available in the video version of today’s program.)

Infiniti needs the new EX to provide a big jolt to sales. Currently it’s the slowest selling model in its line-up. And while sales did take a big jump last month, the numbers are still pretty small.

And that wraps up today’s report, thanks for watching, we’ll see you tomorrow.

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44 Comments to “Episode 909 – UAW Targets Nissan, Chinese Cars Add Up, Renault Launches Car Sharing Program”

  1. Lex Says:

    So when will the Chevy Cruze get the Buick’s Turbocharged 2-liter engine? If the Verano is getting a turbocharged 2-liter, force-fed engine which will produce 250 horsepower and reach 60 miles per hour in 6.2 seconds and delivers about 30 miles per gallon on the highway. It seems like a no brainer to put it into a Chevy Cruze with an “SS” designation.

  2. Lex Says:

    Renault new “Twizy” electric with no fixed pick up or drop-off points will make users “Dizzy”!
    Haven’t these people ever heard of hailing or calling a Cab or Car Service?

  3. Chuck Grenci Says:

    I did a quick search (Wikipedia) and found some raw numbers, by ethnic breakdown. 37 versus 17 percentage Blacks/African Americans from Mississippi versus Tennessee; that surely isn’t definitive (because I don’t the ethnic breakdown in the plants) but shouldn’t that at least be taken into consideration (as well as cost of living between the two stated) before accusations are made? I doubt it is as cut and dry as the proponents preach.

  4. NannyState Says:

    Unions need to stop increasing costs (labor, work rules, flexibility) and then making the rest of the country BAIL THEM OUT when they price themselves and their employers out of jobs – or, make the taxpayers literally take money away from their family to give it to some union “I want mine” mentality-types.

    Wake up – America is down-right tired of union antics – it’s over.

  5. Chuck Grenci Says:

    Chevrolet might have to come up with another sport model nomenclature (as the “SS” moniker will shortly be a whole model name) with the Chevy rear wheel drive (from Holden) coming. Or could the new Chevy SS have a higher performance model called the Chevy SS/SS. (that last comment, with tongue in cheek).

  6. Zieke Says:

    It’s quite unlikely the UAW will get new members at this time at Nissan because wages are quite good, and members would have to fork over those high dues. I’m not anti union, just trying to be practical. As for health care costs, companies cannot afford to pay everything like they used to.I agree that working conditions can get out of hand if left unchecked, but most corps. are fair, so why join a union?

  7. cwolf Says:

    # It is always good when someone adds interesting data. IMO the difference between the two states is considerable. Making an assumption whites dominate skilled/degreed positions,odds are there is a larger black factory work force. This holds true at my plant. But use of the “race card” is becoming more unjustified. Never the less, hourly wages are usually comparable or equal for similar positions within large industries: A $1.50 difference is quite high and reflect up to a 10% pay variance for the same job. I find fault in John’s remark that Miss. wages from Nissan were still better than area averages. If this,”take what you get” philosophy is to have any merit at all,then why not employ more black WOMEN so a company could save another 30% just because they are female? The Miss. workers must have some complaint they can’t resolve from within. This time around the workers contacted the UAW–an important difference! Let their voices speak for themslves.

  8. Jon M. Says:

    Perhaps the UAW doesn’t realize it…scratch that, they just don’t care since it wouldn’t help their cause. Anyway, the disparity in pay between workers at Nissan plants may just have something to do with the cost of living and comparative wages for each area. But surely Bob King and crew are going to use that–and a few other manipulative tricks–to once again try to impose their will on workers at foreign-based auto plants.

  9. HtG Says:

    7 Can you say anymore, cwolf, about the Miss workers having contacted the UAW?

  10. cwolf Says:

    HtG

    All I know is that a certain % of the workers had to express a written interest in the process of joining a union. This is submitted to one of the city offices and to the company. I can ony assume the UAW was contacted by them. My UAW reps wouldn’t say if they had people already in the area,but duh! I’d like to know what their real beef is. The $1.50 could probably be reasoned with.

  11. Bob in Atlanta Says:

    As an auto consumer, I wonder exactly what value is added to a vehicle by having it assembled by UAW members.

  12. Jon M. Says:

    @11 Bob in Atlanta

    I don’t know about any kind of value-added changes brought about by unionizing labor. However, higher wages and benefit costs for workers demanded by the UAW could lead to higher MSRP prices of the vehicles available for sale, given the increase in direct labor costs.

  13. cwolf Says:

    @HtG; Sorry pal,but I gave you the pitch from a salesman. After a few moments of thought I must confess I do know more but can’t say. The Miss thing was a welcome oportunity cuz The UAW knows it cannot afford to keep spending at the present rate. They are getting serious and I doubt that dealer picketing will occure anytime soon. Just remember it takes a whole lot more than a Mr.King to float this boat.

  14. HtG Says:

    Sorry for having asked my question as I did, cwolf. I figured you knew a bit.(I have my own ‘fun’ info in my own life, you bet I keep quiet)

  15. C-Tech Says:

    @ #11
    There is no “value added”in having UAW workers assemble vehicles vs. non-union workers assemble vehicles. What IS at stake (imho) is the long-term benefits and profit sharing between labor vs. corporations. Corporations are not inherently “nice” and “fair”. They only pay what they pay to workers to attract and maintain the skills needed to produce a product. The fact is if a company can get more revenue (higher price) at a lower cost (lower pay) they will, and management will reap the most benefit. What unions bring to the equation is some more leverage for the laborers to get a larger share of the profits. Let’s face it, if businesses could get trained monkees to assemble cars there would be a run on bananas.

  16. C-Tech Says:

    Will the turbocharged Verano be call the Verano T-Type?

  17. C-Tech Says:

    Maybe Seamus and Craig could be the “Tappet Cousins”?

  18. HtG Says:

    I’d argue that the existence of the UAW also has an effect on wages and working conditions at non-union shops. Maybe those canny folks in Miss. are playing the Union card on their Toyota employers?

  19. jesse Says:

    This is not the 70′s anymore.Work conditions are BETTER and will continue so without UNION interference.Their time has come and gone.With all the nanny/big brother types watching everything out there and employer would have to be a frikkin moron to treat their employees bad to the point of getting the government agencies sniffing around.Unions need to go away and stay away once and for all.They are a bunch of overpaid,do nothing cry babies.

  20. jesse Says:

    Oh I’m sorry,do nothing except raise the cost of a car and lower it’s quality!

  21. cwolf Says:

    Imagine what transplant worker wages would be if not for the UAW benchmark! UAW produced vehicles must be stellar enough for each of the big 3 to close the plants in Canada and return jobs here in the US. Even the Fusion and MKZ will be returning to Michigan.
    And,by the way,ALL wages for each manufacturer is relatively even,so any dunderhead thinking the UAW now is cost additive to a vehicle is nonsense. Since the UAW 2-tier agreement has been in effect, have any of you seen a reduction in the price of a car as a result?

  22. C-Tech Says:

    @ #19
    Many managers and engineers are good, some brillant, but there are still a fair number management morons in the business.

  23. Kit Gerhart Says:

    The UAW also helped me, as a salary employee. Were it not for the union contract, I would have gotten less vacation and worse benefits. There is little doubt about that.

    And yeah, I suppose the existance of unions doesn’t directly help me as a car buyer, but I’d still feel a little better knowing that the people building my car were earning a living wage, and would have access to health care if they need it. Without the threat of the union, the workers in the transplant factories would be doing little better than burger flippers at McDonalds, who aren’t too well paid.

  24. W L Simpson Says:

    Re: unions—–In Miami,I saw the handwriting on the wall , quit EAL just before the IAM destroyed it , PanAm & National , all in short order.
    Simple greed, just like bankers & politicians

  25. Jon M. Says:

    @ #21

    One of the things that the then-Engineers of Demise, that is to say the CEOs, of the Detroit Three complained about was a wide gap in wages between their workers and non-union foreign workers. If anyone, the non-union workers appear to be setting the benchmark for wages. Still, a lack of reduction in vehicle prices since the 2-tier agreement doesn’t necessarily mean that the UAW raises or lowers the price of a car, since many factors can influence prices. But if they do demand higher wages and drive up benefit costs, those higher costs have to be absorbed somewhere, and it’s usually passed on to the consumer–in any business.

  26. C-Tech Says:

    @ #24
    Pan Am and National were “destroyed” by airline deregulation and managements failure to adopt to a changing market. EAL was destroyed by just plain bad customer service and mismanagement.

  27. cwolf Says:

    Re#29 Jon M:
    Thanks for the good post. I agree the non-union wages set the precident for unions to make concessions during the collapse,but I remain a believer UAW contracts will set more of the pace in the distant future. Actually monies owed to the union for the retirement fund was and continues to be a tough situation to deal with. The over use of temps by the transplants may be the transplants way of controlling future legacy costs,as well as a selling point for the UAW to unionize the many workers who may feel slighted or at a disadvantage. I only mensioned labor cost added to the price of a car to express my beliefs that the many factors you indicated are likely to out weigh them. If I could predict the UAW greatest priorities,I don’t think the total wage package for the next 1-2 contracts will result in any meaningful increases once so ever. I like replying to good comments.

  28. HtG Says:

    Pedro, WTH? You know what I’m talking about!

  29. cwolf Says:

    Where has T. bejma been? Currently out of current in his Volt somewhere? He was a rather enjoyable contributor.

  30. XA351GT Says:

    Companies should be able to hire the best people qualified for the position regardless of sex or race. Affirmitive action is another failed policy. Where undeserving people are rewarded for no good reason.

  31. C-Tech Says:

    Companies ARE able to hire the best people qualified for the position. It is when companies discriminate in hiring when affirmative action is enforced. Sometimes the best people are NOT cousins, brother-in-laws, and friends kids.

  32. ted Says:

    Nissan sucks I hope the UAW gits in there and does to them what they did to Mitsubishi.

  33. Johndoe1 Says:

    Lex Says:
    June 12th, 2012 at 12:14 pm

    “So when will the Chevy Cruze get the Buick’s Turbocharged 2-liter engine? ”

    Never.

    Because Buick is doing really terribly in sales recently, while Chevy is doing quite well. So I expect the bigwigs at Govt Motors to try to help buick by not having this available in a cheaper Chevy.

    In Addition, the Cruze is a nice but conservative design and it would look a bit out of character in an “SS” edition.

    I would be far more interested in the excellent looking and far more practical Cruse Hatchback they sell in Europe. Esp if they make it with the diesel they will already offer on the 4-door.

  34. Johndoe1 Says:

    TJ Beijma was either not allowed or genuinely ignorant of all the important questions re the failed Volt, in which team he’s working.

    Such as, how much the battery costs for the Dolt?

    AND, how many thousands of $ does they lose in every one they make, DESPITE the OBSCENE $7,500 subsidy from people earning $33,000 to the people buying the Dolt, who have average incomes of $170,000!

  35. Johndoe1 Says:

    sorry for the obvious syntax errors above.

    Re the Prius and the Prius C.

    Kit Gerhart calculated his average MPG with the regular Prius at 47 or so. That’s not average, especially the average of the hundreds of thousands of prius owners that use them in the Sunbelt and warm weather most of the time. The web has lengthy sites with hundreds of owners reporting every fillup and overall mPG and they average far higher than 47.

    The Prius C should be much higher.

    The COnsumer Reports test of the Prius is a failure. FOr both Priuses or Prii, their city MPG is way, way less than what even leadfoot drivers obtain.

    In addition, every car is and should be driven to optimize its intended purpose. It is NOT ‘fair” to drive a corvette like one should drive a prius, or vice versa. COmmon sense.

    Prius drivers will sooner or later join the game and let the car grade themselves from 0 to 100 for their efficiency IQ, and get higher and higher MPG to achiceve the higher scores. COrvette drivers will instead burn rubber and try to minimize their quarter mile times. Both are fine with me, and I respect both vehicles (except for the COrvette’s god-awful interior, a real disgrace)

  36. Johndoe1 Says:

    On Unions.

    IN most cases TODAY, unlike in the past, unions protect the least productive, less efficient and worse performing of their members.

    The teacher’s unions is a perfect example.

    The union steadfastly refuses to pay teachers on ME|RIT, ie on their results, how much have their students learned, how much they improved, etc. It thus shields the WORST Teachers, while, at the same time, it prohibits the excellent teachers to get a far better pay raise, as they deserve, than the lazy and/or ignorant bums. It also protects the bad teachers from being fired, which they should be!

    The victims of their incompetence is YOUR Kids, graduating generations of functionally and literally illiterates and “innumerates” (math illiterates), econ illiterates (which explains credit card debt at 20% interest) and the like.

    On the contrary, the vast majority of the nation’s top Universities, which are without doubt the best in the WHOLE WORLD, have no unions of professors, and the good ones get great pay raises while the bad ones get little or no raises, and it accumulates, so after 30 years, a top prof gets $200k-300k a year, while a bad prof with also 30 years of service will barely get six figures (numbers will be higher in Business, Law or Led school and lower in Math Science and esp Lit)

  37. Johndoe1 Says:

    C-Tech Says:
    June 12th, 2012 at 10:12 pm

    “Companies ARE able to hire the best people qualified for the position.”

    NO they absolutely are NOT. Especially in Government Motors but also in the other “domestic” carmakers, there is HUGE Pressure to hire based on UTTERLY UNRELATED CRITERIA, such as the % of women executives being allegedly “too low”, which has led to DOZENS of poorly or un-quaklified females being hired as TOKENS and performed from poorly to disastrously. Susen DOherty, anybody? And GM’s precious new find, Mary Barra, what has she ever done to deserve her current exalted position? Nothing. She is not even qualified, she was plucked from some Human Resourses outfit and promoted to VP of one of the most crucial GM area.

    It is when companies discriminate in hiring when affirmative action is enforced.

    Utterly wrong. The pressure is HUGE to hire some female (usually) or minority with far less than adequate qualifications when there are veteran male candidates that are OUTSTANDING.

    Sometimes (like 99.9% of the time) women care about cars about as much as you care about women’s purses or shoes. One should not try to increase the % of (heterosexual) males at Gucci the same way one should not try to do the same for females at GM!!!

  38. Kit Gerhart Says:

    #34,
    I use my Prius for all types of driving, as I mentioned in my post. If I excluded the driving on the interstate, my mileage would be higher, near 50. Those who average “far higher than 47″ are “hypermiling,” or just driving under conditions that produce better mileage, or something is wrong with my car, which I don’t think is the case. I drive reasonably economically, but “normally.”

    As far as the Consumer Reports city test, I sort of duplicated it and reported my results a year or so ago when Johndoe1 was posting under one of his former names. Using the trip computer, I got pretty close to what CR did, in the low 30′s. The CR city test starts from a cold start, which makes a difference, even with a Prius, and it is a short test with a lot of stops. I then kept driving at a little higher speed, with few stops, and the mileage for the trip quickly worked its way up to the high 40′s.

    I like my Prius a lot, and it gets better mpg than any other car sold in the U.S. with its capability, but people who are getting 60+ mpg for “average” driving are not driving normally, or their trips are of the very mpg-friendly type.

  39. Kit Gerhart Says:

    How do you judge merit of teachers? By standardized test results? That seems to be the common yardstick, which pits teachers against each other, regardless of the demographics of the school where they teach. Using this type of “merit pay,” teachers who have the very difficult job of teaching in poor neighborhoods will get paid less than equal teachers in better neighborhoods where students perform better on the tests.

    While I don’t agree with teacher’s unions on some things, they certainly have a good point in opposing the usual evaluation of “merit.”

  40. HtG Says:

    38 And why would you want to reward the ‘best’ teachers with higher pay, when you can just fire them and hire a new young, shiny teacher? Little note, in DC where they went heavy into testing as an index of teacher ability, the teachers didn’t just teach to the tests, they corrected the students’ exam papers. funny thing, human nature.

  41. C-Tech Says:

    We are really wandering away from the automotive forum this was.

  42. dave Says:

    That small, high output, turbo, BUICK? market must be big. My buddy just got a new GS, very nice car, but has the same engine and looks the same..GM?

  43. XA351GT Says:

    Uh oh Sybil is back.

  44. Brett Says:

    Reading some of the posts here, I can’t help but wonder what color the sky is where they live, ’cause the world they are apparently living in bears no resemblance to the one I live in.