Author Topic: Buzz loses another one: Final Windsor GM plant to close in 2010  (Read 3189 times)

Offline rrocket

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Another closure under the tenure of Buzz Hargrove: I feel bad for these poeple.  :( http://www.canada.com/windsorstar/story.html?id=4944a781-4d9c-4005-ba5c-ac9c946a04de


Wonder when he will understand that saving wages and saving jobs are 2 different things.   ???
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Offline Zoo

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #1 on: May 12, 2008, 07:38:12 pm »
Buzz is sure going to have a mixed legacy. Some of his failures are his own doing and other ones seem to be at the mercy of market dynamics.

Offline johngenx

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #2 on: May 12, 2008, 07:47:04 pm »
Seems there's more to it than union wages...

"With GM downsizing all of its North American operations, from assembly plants to component plants producing engines and transmissions, many of the company's work forces on the bubble of closure had been fighting for a share of a diminishing pie.

Industry sources have been warning for years that Windsor Transmission was doomed to close no matter what GM's plans for its workforce were. Originally built as an engine plant 1920, and converted to transmission production in 1963, the building was considered too antiquated for modern manufacturing.

The plant's inner-city site, three kilometres from the centre of the city, was also considered too expensive compared to sites elsewhere in Ontario and the United States. Windsor's property taxes, education taxes, power, water and sewage charges are all considerably higher than similar charges in the United States."


If GM had customers lined up to buy it's cars, they would not be closing plants.  Hyundai is building plants in North America.  Other firms are not closing plants.  Guess who?  Oh, that would be Honda, Toyota, etc.  They sell cars that people want, feel confident buying, and have not been relying solely on truck/suv sales to keep them afloat.

Oh, and the wages that those non-union shops pay?  Parity with union shops, or better.  The productivity of the auto worker is VERY high.  Major innovations in robotics and other line improvements over the last 20 years have increased the input value of labour dramatically.

GM's dropping market share should be attributed to their wages?  Oh, yeah, they need a significant cost advantage to sell their :censor: at a discounted rate, 'cause, well, it's :censor:.
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Offline rrocket

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #3 on: May 12, 2008, 07:57:08 pm »
Certainly now with the new UAW pact, wages have much to do with it.  $5+ per hour disadvantage is no chump change over the life of a product. Once the UAW pact comes full force and legacy health care costs are wiped out, that figure will easily double, perhaps triple.  So not only would they be paying out hundred of millions (perhaps billions?) more in wages over the product cycle, but million upon millions to re-tool the plant.

Typically, Canadian auto products have been shown to have superior quality to their American counterparts.  So while there was a quality advantage, I think the cost in these penny pinching times was just too much to overlook.

Offline johngenx

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #4 on: May 12, 2008, 08:15:19 pm »
$5+ per hour disadvantage is no chump change over the life of a product. Once the UAW pact comes full force and legacy health care costs are wiped out, that figure will easily double, perhaps triple.  So not only would they be paying out hundred of millions (perhaps billions?) more in wages over the product cycle, but million upon millions to re-tool the plant.

That has been caused by the rise in the dollar.  All firms are subject to such costs.  GM is not unique.  GM's management has done a brilliant job of making people think that the unions are the cause of their woes.  I stand by the fact that their product line is out of touch, their reputation for quality (real or percieved, matters not) sucks and they have relied on 1950's full-frame truck technology to keep them from falling into Chapter 11.  Their management has been shortsighted, focusing on costs to the point of compromising quality (grinding their suppliers into the ground) and obsessing over wages.  Looking inward has cost the company their position as the leader of the market.

Toyota, Honda and Hyundai looked to the market and brought cars to market that people want to buy.  Toyota and Honda have been able to charge a premium price.  How?  Interesting...

Offline rrocket

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #5 on: May 12, 2008, 08:25:29 pm »
Yea...the original $5 was from the dollar.  The new UAW pact tosses out their legacy healthcare costs after 2 years and industry analysts predict that cost advantage will balloon to $15-$22.  If you don't think an addition $15-$22 PER employee hour crossed their minds, plus the re-tooling cost, then your head is in the sand.


Honestly...I think the UAW made the pact they did specifically to put the CAW shops out of business.  They know Buzz and his unwillingness to touch wages.  So they made the deal they did to put the pressure on the CAW and to secure future jobs in the USA.  It was a coup of sorts.

Offline Zoo

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #6 on: May 12, 2008, 08:28:31 pm »
Toyota, Honda and Hyundai looked to the market and brought cars to market that people want to buy.  Toyota and Honda have been able to charge a premium price.  How?  Interesting...

This is the real killer. While Honda and Toyota erode the domestic's market share Hyundai has snuck up and become huge competition to everybody except for the the truck market.

I would strongly consider a Sonata for a mid sized car and an Elantra for a compact. There is nothing from Chrysler presently that I would want while Ford has the Fusion that I like and the Chevy Malibu might get a test drive.

In the compact and sub compact market there is nothing in the domestic lineup right now that would even merit a test drive from me. I had high hopes for the Chevy Cobalt but with the recent Corolla plus the Civic, Elantra etc it is sitting near the back of the pack.

I know lots of other people who feel the same way. Kind of sad...

Offline tpl

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #7 on: May 12, 2008, 09:53:29 pm »
Yea...the original $5 was from the dollar.  The new UAW pact tosses out their legacy healthcare costs after 2 years and industry analysts predict that cost advantage will balloon to $15-$22.  If you don't think an addition $15-$22 PER employee hour crossed their minds, plus the re-tooling cost, then your head is in the sand.


Honestly...I think the UAW made the pact they did specifically to put the CAW shops out of business.  They know Buzz and his unwillingness to touch wages.  So they made the deal they did to put the pressure on the CAW and to secure future jobs in the USA.  It was a coup of sorts.
So I wonder what will happen when GM closes all its plants in Canada.  If they did that there would only be one union to talk to, no border worries. They could just be a US car/truck manufacturer.     No different from many manufacturers that don't make cars here.  Volvo, Subaru, M-B etc. I am sure that people would still buy GM cars, maybe not as many tho'.  Maybe they'd slowly just stop selling cars here. The dealers would be unhappy but class actions are difficult to do in Canada.
« Last Edit: May 12, 2008, 09:56:08 pm by tpl »
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Offline johngenx

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #8 on: May 12, 2008, 10:03:46 pm »
In the compact and sub compact market there is nothing in the domestic lineup right now that would even merit a test drive from me. I had high hopes for the Chevy Cobalt but with the recent Corolla plus the Civic, Elantra etc it is sitting near the back of the pack.

I know lots of other people who feel the same way. Kind of sad...

The Big Three never truly developed their compact car lines for North America.  The first oil shocks of 1973 allowed Honda and Toyota to gain some ground, and though the Civic and Corolla weren't great cars, they were the class leaders in a limited segment that suddenly grew like crazy.  For some reason, Honda and Toyota decided to focus their efforts on that class, seeking to earn massive volumes of sales while The Big Three seemed to say "cheap cars don't need high quality" and laughed at entry level buyers.

Then the oil shocks came hard again in 1979 and the recession of the early 1980's allowed Honda and Toyota to gain futher ground with the Accord and Camry.  Once again, The Big Three had no credible competitors (The Chevy Citation?  What a joke)  Did they come out hard and sink money into R&D for inreasing quality in the compact and newly invented Accord-class?  No.  They whined about Japanese firms.  Toyota and Honda started building plants in North America to overcome import restrictions.  They also played on the fact that their products were now being built locally.

GM et al lucked out with the cheap gas of the 1990's and rebounded with the giant SUV craze.  Ah, but history repeats itself.  Didn't everyone know that the price of oil might go through the roof again?  Huh?  Toyota and Honda were being laughed at as they came out with the Insight and Pruis.  They soldiered on with improving the Civic and Corolla while GM kept pushing the Cavalier on people.  Whoops.  Oil is $130 a barrel, gas is pushing $4/gal in the US, and guess what?  Toyota HAS been pushing big vehicles, but not at the expense of the smaller lines.  They're going to get hit on the truck/SUV side, but they can bring hybrid/whatever cars to market quickly and people will line up to buy them.

People can go on all they like about wages, contracts, whatever, but the truth is that poor products, poor management and lack of long term outlooks have crushed the Big Three.  Executive compensation was tied to stock prices some time ago, and the market reacted quickly to cost cutting measures with immediate stock surges.  Guess what?  Executives learned that short term results enriched them personally.  Heck, they'd make $100 million and even if they go the boot after two years, so what?  They were rich.  No one cared about developing products.  No one cared about quality or market driven products.  Management focused on grinding suppliers and fighting with the unions.

Read Wagoner's book and he admits that GM made massive managment mistakes over 30 years prior to 1990, and found it nearly impossible to recover from them.  Heck, they didn't listen at all.  The board hired Ron Zarella to pilot the ship!  Huh?  The CEO of Bausch & Lomb?  Yup, the world's largest car maker needs a guy from the Contact Lense market!  Thankfully, he was replaced after four years, but that is indicative of the goofs made.

GM needs to look closely at the tight product lines of Honda and Toyota (Honda's is AMAZING in how few models span a huge audience and conserve production) to see that having a bewildering array of cars is NOT the way to go.  Personally, I have NO idea of the differences of the Pontiac G5 or G6 and so on.  Who wants to take the time to try and figure out their novel thick line up?  Not me. They need a subcompact line (Yaris/Fit), compact line (Civic/Corolla), family sedan (Accord/Camry) and a CUV (CR-V/RAV-4) and they need to be clearly identified in the segment so that people know what is what.

Whatever they're putting in the coffee at Cadillac and Corvette needs to be fed to the managment at the rest of the company.  I think those two brands are being left alone somehow.  Now, they're not perfect, but those two lines show what GM has in terms of potential...

Offline rrocket

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #9 on: May 12, 2008, 10:08:22 pm »
So I wonder what will happen when GM closes all its plants in Canada.  If they did that there would only be one union to talk to, no border worries. They could just be a US car/truck manufacturer.     No different from many manufacturers that don't make cars here.  Volvo, Subaru, M-B etc. I am sure that people would still buy GM cars, maybe not as many tho'.  Maybe they'd slowly just stop selling cars here. The dealers would be unhappy but class actions are difficult to do in Canada.


You have it exactly.  The UAW saw the CAW as its direct competition for jobs.  And rightfully so.  The 10,000 or so jobs here from GM is nothing to sneeze at.  The UAW's new pact would put the squeeze on the CAW.  No doubt in my mind the CAW could have put the squeeze on the UAW by making difficult business decisions.  But Buzz didn't want to live with the legacy of being the 1st CAW chief to make serious wage concessions.

I also think the chest thumping Buzz did prior to these negotiations had something to do with this plant closure (or not, who knows).  But he had said that he would not take "NO" for an answer on whether there would be a new product in some plants, and that he was going to have a guarantee of new product into the agreement, or they would STRIKE.  Looks like GM didn't like it, or didn't care, and basically said "Screw you" and closed the plant altogether.

Don't get me wrong...I'm not saying that the union is a bad thing for employees here...I'm saying Buzz dropped the ball by not having enough foresight to see how the industry was changing, how there was going to be a crunch, and for doing little, if anything, with Canada being at a cost disadvantage to the US.  The UAW was more progressive, fired the 1st salvo by making their new deal to lower wages, have a 2 tier system and cut out legacy health care costs from the Big3 pockets.  The UAW made very difficult choices to secure their future jobs.  I'm convinced the wrote that deal just to shaft the CAW, since they saw them as competition.


And I agree 100% with JonGenX.  The Big3 ignored the "new small car buyer" in favor of big truck and SUV sales.   If you can hook a customer into a high quality small car (like the imports do) and not make them feel like they are driving a "cheap" car, they will come back when it's time to purchase a new car or truck.  The Big 3 have been feeding us crap little cars for so long, it's now a case of "once bitten".  I mean, look how long it took Hyundai to regain even a modicum of respect in the market place after their quality disaster, the Pony.  15-20 years or so?
« Last Edit: May 12, 2008, 10:13:15 pm by rrocket »

Offline barrie1

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #10 on: May 12, 2008, 11:26:32 pm »
I wonder just how long before the Import Companies who are building vehicles here are going to have thousands of retiree's on their payrolls as well. That definitely will change their bottom line as well. Its only in North America that GM is not making that much money but even Canada is showing profits every year. GM built a new tranny plant overseas in the last few years instead of spending the money in Windsor as well.  :)

Offline Zoo

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #11 on: May 13, 2008, 12:17:57 am »
The Big Three never truly developed their compact car lines for North America.  The first oil shocks of 1973 allowed Honda and Toyota to gain some ground, and though the Civic and Corolla weren't great cars, they were the class leaders in a limited segment that suddenly grew like crazy.  For some reason, Honda and Toyota decided to focus their efforts on that class, seeking to earn massive volumes of sales while The Big Three seemed to say "cheap cars don't need high quality" and laughed at entry level buyers.

They sure did laugh at us with horrendous products like the Vega and Pinto/Bobcat. Frankly I am still shocked at how Ford handled the Pinto/Bobcat situation (propensity to catch fire) and the Firestone/Explorer debacle. They have pretty much permanently lost my trust and I pretty much vote with my wallet and boycott Ford. Too bad for me as the Fusion is the first Ford vehicle in a long time that gets my pulse racing. The Mustang is an awesome car as well.

GM et al lucked out with the cheap gas of the 1990's and rebounded with the giant SUV craze.  Ah, but history repeats itself.  Didn't everyone know that the price of oil might go through the roof again?  Huh?  Toyota and Honda were being laughed at as they came out with the Insight and Pruis.  They soldiered on with improving the Civic and Corolla while GM kept pushing the Cavalier on people.  Whoops.  Oil is $130 a barrel, gas is pushing $4/gal in the US, and guess what?  Toyota HAS been pushing big vehicles, but not at the expense of the smaller lines.  They're going to get hit on the truck/SUV side, but they can bring hybrid/whatever cars to market quickly and people will line up to buy them.

Too bad for people like me who enjoy smaller cars. I really liked the 1993 Sunbird I had with the 3.1L V-6. It was both peppy and very reliable. Trouble is that even for 1993 the car was very unrefined and several years later the Cavalier and Sunfire weren't that much different than the car I had moved on for a Civic.

...and Toyota (Honda's is AMAZING in how few models span a huge audience and conserve production) to see that having a bewildering array of cars is NOT the way to go.  Personally, I have NO idea of the differences of the Pontiac G5 or G6 and so on.  Who wants to take the time to try and figure out their novel thick line up?  Not me. They need a subcompact line (Yaris/Fit), compact line (Civic/Corolla), family sedan (Accord/Camry) and a CUV (CR-V/RAV-4) and they need to be clearly identified in the segment so that people know what is what.

Yup! Other than Saturn's current products GM is still doing its share of "badge engineering". I am exempting Saturn to an extent because many of their cars are more Opel in design than the similarities between Chevy Aveo/Pontiac Wave, Chevy Cobalt/Pontiac Pursuit/5 etc. I like sub compacts, compacts, and mid sizers. I am not a CV or SUV guy. GM got serious about building a good mid sizer and the Malibu is the result. Time will tell if they got it right or if it will end up like the Cobalt which I had high hopes for but which ended up becoming a fleet filler more than a serious competitor in its segment.

Whatever they're putting in the coffee at Cadillac and Corvette needs to be fed to the managment at the rest of the company.  I think those two brands are being left alone somehow.  Now, they're not perfect, but those two lines show what GM has in terms of potential...

100% agree here! Cadillac has been on a roll for many years now and after the Catera they have been putting out solid product after solid product. The product cycle hasn't been measured in decades either as GM tried to pull with the Cavalier/Sunbird/Sunfire.

Offline tpl

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #12 on: May 13, 2008, 06:19:15 am »
I wonder just how long before the Import Companies who are building vehicles here are going to have thousands of retiree's on their payrolls as well. That definitely will change their bottom line as well. Its only in North America that GM is not making that much money but even Canada is showing profits every year. GM built a new tranny plant overseas in the last few years instead of spending the money in Windsor as well.  :)

A properly funded pension plan is not that harmful to a companies profits.  The costs are known way into the future and the actuaries can allow for changes in life expectancy. I.e. the demographic of the retirees and then a good investment companie can ensure the money is there.

An open ended commitment to retiree health care as in the USA would not need to happen here... it could but doesn't need to and would of course be much cheaper than in the USA. Thats what made the US system so expensive.

Offline toolatecrew

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #13 on: May 13, 2008, 07:16:59 am »
I wonder just how long before the Import Companies who are building vehicles here are going to have thousands of retiree's on their payrolls as well. That definitely will change their bottom line as well. Its only in North America that GM is not making that much money but even Canada is showing profits every year. GM built a new tranny plant overseas in the last few years instead of spending the money in Windsor as well.  :)

I don't see why it would. There are thousands of companies that have been in business for many many years that have a lot of retired employees on pension. They are all doing just fine. Just because GM royally screwed up on the pension benefits side doesn't mean its the norm for every company. Import companies have never entered into the same type of agreements with Unions that GM did way back when so to compare them is just sour grapes really. GM took a big hit so I hope Import companies do to so I can feel better that we all got the shaft?

GM built a new modern plant  (probably without a Union mucking things up) instead of refitting an old outdated plant at a higher cost, where wage costs are higher and where the Union might strike to just prove a point about another unrelated plant? What kind of business decision is that..a smart one.

That's what are the rah rah union people never seem to get. Everything is not about screwing the union. Thousands of companies make BUSINESS decisions every day to close plants. Its unfortunate for the people who work there but no one ever guarantees a plant will provide employment to a community forever. I suppose if it was unionized the CWA would strike until a plant reopened to produce asbestos insulation?

This plant produced a product that is not in demand (4 speed autos). It makes sense to produce 5-6 speed autos on a new modern assembly line in a new modern facility.


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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #14 on: May 13, 2008, 07:39:40 am »
"This plant produced a product that is not in demand (4 speed autos). It makes sense to produce 5-6 speed autos on a new modern assembly line in a new modern facility."

 :iagree:

Makes sense, eh?

Offline toolatecrew

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #15 on: May 13, 2008, 07:42:39 am »
"This plant produced a product that is not in demand (4 speed autos). It makes sense to produce 5-6 speed autos on a new modern assembly line in a new modern facility."

 :iagree:

Makes sense, eh?

Since then does that matter? Buzz said they would have gone on strike to FORCE GM to put a product in an old outdated plant if they thought they could have succeeded.

Offline barrie1

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #16 on: May 17, 2008, 09:52:15 pm »
Rrocket you recently stated that the cost advantage was wiped out between Canada and the US, I said it wasen,t and you stated it was. Why is Buzz stating that we still have a 10% advantage at least over the US which I also have known to be true as well. We also have never had a Pension Problem in the GM corp plans either as Toolatecrew has stated as well here in Canada or the US either. They had a problem with their health beneifits only on the US side but never here ever. Sure glad all you Folks who never worked there know all about it and have all the facts correct as well aye. All GM factories are Union built and are always under budget as well. They are usually open for a year before the Union goes in unless its a replacement factory for one that has been damaged or needs to be rebuilt for old age. :)

Offline Rupert

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #17 on: May 18, 2008, 09:17:45 am »
Maybe someone could comment on the following statements read :

GM does not make any proffit on the vehicle manufacturing section.

GM Financial makes money for the company.

   Surely what we are wittnessing is the same race to the bottom that has been going on for some time. The smaller cars in the GM lineup are imported are they not. High wages and benefits here must be a feature of corporate decisions. Surely it is the labour content here that has priced itself out of the market. I presume that plants abroad, that have North American financing, are using the same advanced technology. Let's face it, they have to be. The news media has been reporting downsizing and job losses in North America in all kinds of industries, not related to the automotive sector, for years now. Salaries for the most part have been stagnating for years outside of large unionised work forces. The numbers of new jobs that are being touted with pride, are not paying as much money as the lost ones and are often casual. How many times have you been solicited by someone who wants to clean your heating ducts, or fit windows, or treat your lawn in recent years. It would seem that the 'profitable' market for a North American manufactured product has long gone and one wonders when the 'hold the line' contracts that have just been negotiated will turn to roll backs or more job losses. No union is an island entire to itself.

Offline jcon

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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #18 on: May 18, 2008, 09:28:33 am »
GM Financial? Didn't GM sell off their financing wing (GMAC)?


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Re: Buzz loses another one: Final Windsor GM plant to close in 2010
« Reply #19 on: May 18, 2008, 10:32:24 am »
http://www.usatoday.com/money/autos/2006-03-23-gmac-commercial_x.htm
Probably a bit of luck that they sell before mortgage crash in the States