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The demise of the OEMs
- Thread starter Buckminster
- Start date
Interesting how the usa auto manuf and UAW don’t get they are in this survival fight together
Also union labor has the threat of robotics coming
As I stated, I would love to hang fenders on vehicles for $100K per year at low Midwest living costs, buts an outdated model
I remember hearing UAW members pride themselves at having two vehicles and a boat in their driveway, must be nice
now it’s caught up, we cannot afford that any longer
Get a clue guys and stay competitive, work together to survive, get labor costs under control, embrace EV manuf, embrace the application of automation and robotics
Reskill for other industries, healthcare pays well and they need workers
Also union labor has the threat of robotics coming
As I stated, I would love to hang fenders on vehicles for $100K per year at low Midwest living costs, buts an outdated model
I remember hearing UAW members pride themselves at having two vehicles and a boat in their driveway, must be nice
now it’s caught up, we cannot afford that any longer
Get a clue guys and stay competitive, work together to survive, get labor costs under control, embrace EV manuf, embrace the application of automation and robotics
Reskill for other industries, healthcare pays well and they need workers
Knightshade
Well-Known Member
You realize how contradictory those are right?
"We need to keep taking crap contracts for jobs that without negotiating will just get replaced by robots anyway" is the result of those statements combined and they make no sense as a strategy.
So would most UAW workers.
Starting pay under the existing 2-tier contract is like 17 bucks an hour-- less than you can make at fast food these days in many places.
It's weird you attack anything foreign, but then get mad at American workers wanting manufacturing jobs paying better than burger flipping.
The below are from Aug 1, 2023:/cloudfront-us-east-2.images.arcpublishing.com/reuters/5CYPW2ZAGFOWLETZD7N6CMTDFE.jpg)
Toyota's August global output rises on stronger domestic production
Toyota Motor said global production climbed 4% from the same period a year earlier to 798,771 vehicles to mark a record for the month of August.www.reuters.com
Toyota on track to smash its annual production record – report
Toyota looks set to break its annual production record, with expectations it will build more than 10 million cars in 2023.www.drive.com.au
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Toyota's Global Sales And Output Hit Record High in August Amid Robust Local Production
Toyota Motors (TM) global sales in August reached an all-time high, on the back of record output driven by enhanced supply conditions and heightened demand.www.investopedia.com
/cloudfront-us-east-2.images.arcpublishing.com/reuters/7ICV4RSNP5M7BPDDADL53N62TY.jpg)
Toyota nearly doubles Q1 profit, China remains challenging
Toyota nearly doubled its operating profit in the first quarter, the Japanese automaker said on Tuesday, helped by increased sales and productivity as well as the tailwind from the weaker yen.
www.reuters.com
Toyota Profit Tops Estimates, Sending Shares to All-Time High (Bloomberg)
Toyota Motor Corp.’s quarterly profit exceeded estimates as improvements in supply of semiconductors and a weak yen helped it capitalize on a global rebound in demand for vehicles.
I'm actually planning a trip to Japan where I leave late October, partly to attend https://www.japan-mobility-show.com/en/press_release/2023/0830/index.html (fka Tokyo Motor Show) for 2 days. IIRC, the show is back after a hiatus due to COVID. I was at TMS in 2019 and have been to Japan 6 or 7 times before for vacation. The weak yen is good for me.
adiggs
Well-Known Member
An interesting, and possibly counter-intuitive, component of the Innovator's Dilemma is that right before the crash of the old guard business, you will frequently see that old guard business experience record profits.
The book has this as a consequence of the new technology eating the market from the bottom up, taking the low price / low profit business and then working its way up the stack. For the old guard business they drop the high volume / low profit business, so that what is left is the highest profit businesses.
I've always thought that Innovator's Dilemma was a bit short sighted in this particular dynamic as it calls for the disrupting business to disrupt from below. That was certainly the case in the technology industries that were cited in the book.
In the EV and light duty vehicle market, the disruption is entering the market from above, where the new technology is taking out the highest revenue and highest profit vehicles. The established US car manufacturers (GM, Ford, Stellantis) have their truck businesses that are there most profitable and are not yet being attacked from the top end, the way that sedans and SUVs have been. This is protecting them and making the businesses look much more healthy than they really are.
Clearly that protection in the market will end soon.
Anyway - just wanted to say that I won't be surprised to see a late "surge" in profit from the old guard auto makers, right before their businesses collapse.
The book has this as a consequence of the new technology eating the market from the bottom up, taking the low price / low profit business and then working its way up the stack. For the old guard business they drop the high volume / low profit business, so that what is left is the highest profit businesses.
I've always thought that Innovator's Dilemma was a bit short sighted in this particular dynamic as it calls for the disrupting business to disrupt from below. That was certainly the case in the technology industries that were cited in the book.
In the EV and light duty vehicle market, the disruption is entering the market from above, where the new technology is taking out the highest revenue and highest profit vehicles. The established US car manufacturers (GM, Ford, Stellantis) have their truck businesses that are there most profitable and are not yet being attacked from the top end, the way that sedans and SUVs have been. This is protecting them and making the businesses look much more healthy than they really are.
Clearly that protection in the market will end soon
.Anyway - just wanted to say that I won't be surprised to see a late "surge" in profit from the old guard auto makers, right before their businesses collapse.
If you're talking about the US market, the shift in preferences towards "light trucks" (includes SUVs, (light) pickups, most "crossovers", minivans and some vans) began ages ago.The book has this as a consequence of the new technology eating the market from the bottom up, taking the low price / low profit business and then working its way up the stack. For the old guard business they drop the high volume / low profit business, so that what is left is the highest profit businesses.
...
In the EV and light duty vehicle market, the disruption is entering the market from above, where the new technology is taking out the highest revenue and highest profit vehicles. The established US car manufacturers (GM, Ford, Stellantis) have their truck businesses that are there most profitable and are not yet being attacked from the top end, the way that sedans and SUVs have been. This is protecting them and making the businesses look much more healthy than they really are.
Clearly that protection in the market will end soon
Passenger Cars Are Outsold by Light Trucks for First Time is from 2002. Passenger car erosion continued. And, the Big 3 US automakers have pretty much left the passenger car market having few such models in the US now, ceding it to import brands w/pretty much Asian automakers taking their place. Go browse the US web pages of the Big 3 and see how many passenger car models they offer and go find their US sales stats.
Many passenger car model from back in the day are simply gone like Fusion, Taurus, Cruze, Neon, Caliber, Sebring, LeBaron, Crown Vic, etc.
Doggydogworld
Active Member
By this logic Toyota should be hurting, not reporting record profits. I think it's leftover from supply chain shortages. Prices shoot up overnight then slowly grind their way back down. The grind-down phase, while it lasts, produces excess profits.
1. Why even mention the 2019 contract? That's not what the OEMs offered.
2. It's disingenuous to ignore the lavish benefits a day one autoworker receives that a McDonald's employee never gets
3. Which 19 year old works harder, a McDonald's worker or a new UAW hire?
4. Do McDonald's workers progress to $33/hr cash comp plus lavish benefits in four years?
- The demanded 40% raise takes that $33 to 46.20
- The demanded 32 hour week takes that 46.20 to 57.75
- 57.75 is at least 120k per year for a worker who chooses to continue working 40 hours/week
- It's probably 132k per year, assuming they get time-and-a-half for the 8 hours of "overtime" each week
If you want to support the "poor, exploited workers", that's your business. But let's be honest about the numbers.
Knightshade
Well-Known Member
Because the guy I was replying to was saying he too would like to make 100k a year hanging bumpers.
Which is not, remotely, what actual UAW new employees make today doing that.
Is it? Does the UAW guy not do more/harder work? And even then he's still not getting the 100k a year the guy I was replying to claimed.
But it won't raise the price of their ICE vehicles similarly (or worse)?
Doggydogworld
Active Member
If UAW gets the battery JVs the impact will be worse on EVs than ICE. The OEMs desperately need to keep the UAW out of those factories to be comptetitive. But it's tricky because they're building them with loan guarantees from Union Joe.
Doggydogworld
Active Member
You know good and well he was talking about the new contract. The UAW is demanding 120-132k per year. Why do you keep denying this?
Compare these demands to pay for teachers with 4 year degrees or construction workers out in the weather or paramedics who save lives with their specialized training. You know, the people who actually buy the cars. Then tell me about "justice".
The UAW workers I knew back in the day didn't work nearly as hard as the average McDonald's employee. And the vast majority had no special skills or training.
This is my experience as well.
I worked in a union fabrication shop for many years back in the late nineties, the union restricted what we could do, it was like a ball and chain around our productivity. That union added very little value for anyone but the lazy IMHO.
Then I left for a non-union fab shop and the difference was like night and day. People could change positions almost at will, do other people's tasks without issue when needed, anyone could drive the freaking towmotor as long as they were certified, etc. We could have engineers out on the lines building things when needed and no one raised any fuss at all. The level of freedom was a breath of fresh air and we were incredibly productive without the union dictating rules which only served to limit efficiency.
Needless to say I am not a fan of unions in this day and age, I've had many negative experiences with them, and to me the UAW appears trying to be killing the hand which feeds them out of spite or some vendetta.
Knightshade
Well-Known Member
How, specifically, do I know that?
I ask because the FULL quote from him was
"As I stated, I would love to hang fenders on vehicles for $100K per year at low Midwest living costs, buts an outdated model
I remember hearing UAW members pride themselves at having two vehicles and a boat in their driveway, must be nice
now it’s caught up, we cannot afford that any longer"
Which sure reads like a comment on their CURRENT situation. Otherwise he couldn't have said "cannot afford that any longer" if it's something we're not affording NOW.
Because that's how linear time works.
I didn't.
Again you seem to be making up arguments nobody else was having then being mad about them.
Now that you mention it though your claim is also factually wrong.
UAW demands 46% pay hike in talks with Detroit Three automakers
The proposal would be the largest pay increase in recent memory.
www.detroitnews.com
$47.14 an hour, in order to make 120-132k a year, would require working 2545 to 2800 hours a year- or 49-54 hours a week every week with 0 time off.
So even when you move goalposts you can't even move them to the correct place
Even worse- ANOTHER of the demands is a 32 hour work week at that rate of pay.
Which for the math challenged would be (again assuming no unpaid time off) $78,440.96 a year.
Bit far off from the 120-132k you claimed.
No, here is the mathHow, specifically, do I know that?
I ask because the FULL quote from him was
"As I stated, I would love to hang fenders on vehicles for $100K per year at low Midwest living costs, buts an outdated model
I remember hearing UAW members pride themselves at having two vehicles and a boat in their driveway, must be nice
now it’s caught up, we cannot afford that any longer"
Which sure reads like a comment on their CURRENT situation. Otherwise he couldn't have said "cannot afford that any longer" if it's something we're not affording NOW.
Because that's how linear time works.
I didn't.
Again you seem to be making up arguments nobody else was having then being mad about them.
Now that you mention it though your claim is also factually wrong.
UAW demands 46% pay hike in talks with Detroit Three automakers
The proposal would be the largest pay increase in recent memory.www.detroitnews.com
$47.14 an hour, in order to make 120-132k a year, would require working 2545 to 2800 hours a year- or 49-54 hours a week every week with 0 time off.
So even when you move goalposts you can't even move them to the correct place
Even worse- ANOTHER of the demands is a 32 hour work week at that rate of pay.
Which for the math challenged would be (again assuming no unpaid time off) $78,440.96 a year.
Bit far off from the 120-132k you claimed.
Current
Bottom Tier $17 per hour without paid benes, don’t know the full loaded pay with benes paid
Annual $35K and TBD
Top tier $32 per hour, this becomes $66 with benes paid
Annual $66K and $137K with benes
(Don’t know about you I have to pay my benes)
If strike is successful/future:
Bottom tier merged into top tier
Top tier after 45% increase
$32->$46 unloaded
$66->$96 with benes
40 hr week $200K
32 hr week $160K
I want in hanging fenders $200K per year
OEMs reported their Q3 P&D numbers today, figures for US only.
GM deliveries for US only reached 674,336 of only 20,000 which were BEV. This total was up 21% from Q3 2022. At end of quarter GM had 442,586 autos listed as inventory. GM advised their BrightDrop electric delivery vans have halted production this month until Spring 2024 due to battery module delays.
Stellantis delivered for North America only sales of 380,563, down 1% from Q3 2022. Their N.American inventories are above the national average. No mention of BEVs.
Honda delivered 331,608 vehicles, up 49.3% YOY. Do they sell any pure BEVs?
Toyota delivered 590,296 vehicles, up 12.2% YOY. Do they sell any pure BEVs?
Ford delivery estimate is for 493k vehicles (up 6.9% YOY). Their EV sales are shrinking.
Rough calculations would put the OEMs number 3X as noted above for their world wide sales (assuming 1/3 N.America, 1/3 Europe and 1/3 China). That is a lot of new ICE vehicles, not including the German OEM (Volkswagon, BMW and MB). So it looks like Tesla is going to do this transition to BEVs alone (with help from Chinese and Korean manufacturers) and a couple of upstarts, and it will be a long slog without help from the traditional OEM manufacturers. Sad.
Two sources: AFP, The Detroit News, and IBD Digital:
GM reports higher Q3 sales as strike tests outlook — AFP News
GM Q3 sales beat expectations, up 21% from Q3 2022
GM ended the quarter with 442,586 vehicles in dealer inventory marking the best quarter ending since the third quarter of 2020.www.detroitnews.com
General Motors Takes Q3 Sales Crown, But GM Stock Makes New Low
Citing expectations for strong Q3 auto sales, analyts hiked their forecast for the full year.www.investors.com
Doggydogworld
Active Member
Not a terribly accurate summary.
Ford and GM take turns being a distant #2 in US BEV sales. GM slipped behind Ford in Q3 with 20,092. Of those, 16k were Bolts. Ultium sales were slightly less pathetic than prior quarters - 3k Cadillac Lyriqs and almost 1.2k Hummer EVs. They also sold their very first Blazer EV and Silverado EVs -- 19 and 18 respectively -- plus 35 of the production-paused BrightDrop vans.
GM was supposed to sell 25k Lyriqs in 2022. They only sold 125 or so, and only 5k so far in 2023. GM blames the Ultium disaster on 3rd party battery pack production equipment, but IMHO that's just the tip of the iceberg. GM could fall behind Rivian, Hyundai/Kia, VW and maybe a couple others when Bolt production ends in two months. Mary Barra needs to resign, or at least return her 40m bonus.
I think Hyundai-Kia sold ~17k US BEVs in Q3. They don't break out Kona, Niro, etc. by drive train, so we don't know how many are BEV, vs. PHEV, HEV or ICE.
Stellantis sells tons of BEVs in Europe, including at least one Jeep model, but none currently in the US. They never brought the new-gen Fiat 500e over and their Jeep, Ram and Chrysler BEVs are a year or more away from US dealers. They still have some Jeep PHEVs that sell OK.
Honda sells BEVs in Europe and elsewhere to meet quotas. They discontinued their (low range) BEVs in the US. Their next US BEV is the Prologue, a rebadged Chevy Equinox. In theory you can order one this quarter for delivery in early 2024.
Toyota sells the bz4xqwtpdrm BEV in the US, along with an upgraded version (thankfully) called the Lexus RZ. Together they sold only 4.2k in Q3. They're often discounted on dealer lots. Meanwhile Toyota's excellent PHEV40s -- RAV4 Prime (7.9k in Q3) and the new Prius Prime (3.3k) -- are almost impossible to find in the US. Most of their limited production goes to Europe to meet quotas. Toyota also sells ~1k Mirai fuel cell cars in the US each quarter. I have no idea who buys (or leases) those. Maybe Toyota execs in SoCal, under duress....
Ford sold a record 20,902 BEVs in Q3. Only up 15% y/y and way below their stated goal, but not "shrinking". Mach E sales were a record 15k. F-150 Lightning sales were down almost half y/y to 3.5k. They paused Lightning production (again), this time for the 2024 MY changeover. It finally has a heat pump!
Ford and GM take turns being a distant #2 in US BEV sales. GM slipped behind Ford in Q3 with 20,092. Of those, 16k were Bolts. Ultium sales were slightly less pathetic than prior quarters - 3k Cadillac Lyriqs and almost 1.2k Hummer EVs. They also sold their very first Blazer EV and Silverado EVs -- 19 and 18 respectively -- plus 35 of the production-paused BrightDrop vans.
GM was supposed to sell 25k Lyriqs in 2022. They only sold 125 or so, and only 5k so far in 2023. GM blames the Ultium disaster on 3rd party battery pack production equipment, but IMHO that's just the tip of the iceberg. GM could fall behind Rivian, Hyundai/Kia, VW and maybe a couple others when Bolt production ends in two months. Mary Barra needs to resign, or at least return her 40m bonus.
I think Hyundai-Kia sold ~17k US BEVs in Q3. They don't break out Kona, Niro, etc. by drive train, so we don't know how many are BEV, vs. PHEV, HEV or ICE.
Stellantis sells tons of BEVs in Europe, including at least one Jeep model, but none currently in the US. They never brought the new-gen Fiat 500e over and their Jeep, Ram and Chrysler BEVs are a year or more away from US dealers. They still have some Jeep PHEVs that sell OK.