VW Workers in Germany

[jkarolyi]

I think the Detroit analogy is right on the money. In the 60s, American auto workers were the top paid in the industry, and they negotiated generous pensions and lifetime health benefits, etc. American cars were also competitve and in many cases superior to those from Europe, and especially Japan. Much the same as VW today.

Bring on the Japanese (70s) and later the Korean (80s) cars. Low cost/high quality labor produced cars people want to buy. Detroit cannot afford R&D to compete with them due to their workforce being coddled with pay and benefits which are not sustainable. Most GM cars still use evolved versions of platforms developed in the 80s.

I think the point of the Detroit analogy is that German workers should travel there to see the long-term results of anti-business unions, work rules, and government. Empty skyscrapers and poverty everywhere. When a company is losing money by the bucketfull like VW is right now, the employees should be volunteering for a 40 hour workweek at the least!

[Jim727]

Originally posted by jkarolyi
I think the Detroit analogy is right on the money. In the 60s, American auto workers were the top paid in the industry, and they negotiated generous pensions and lifetime health benefits, etc. American cars were also competitve and in many cases superior to those from Europe, and especially Japan. Much the same as VW today.

Bring on the Japanese (70s) and later the Korean (80s) cars. Low cost/high quality labor produced cars people want to buy. Detroit cannot afford R&D to compete with them due to their workforce being coddled with pay and benefits which are not sustainable. Most GM cars still use evolved versions of platforms developed in the 80s.

I think the point of the Detroit analogy is that German workers should travel there to see the long-term results of anti-business unions, work rules, and government. Empty skyscrapers and poverty everywhere. When a company is losing money by the bucketfull like VW is right now, the employees should be volunteering for a 40 hour workweek at the least!

There's some truth to that, but not the whole truth. We need to remember that the key to Japanese success in the auto industry - and later other industries - was a gent named W. Edwards Deming. He was an American that Detroit management would *not* listen to. Sent to Japan, he completely turned around their quality control processes and management/labor relationships. Today the highest industrial award in Japan is the Deming Award. The average American worker is capable (important word) of being resourceful and innovative, but rarely permitted to apply themselves. Unions (who want power) and Management (who won't let go of their Plantation-mentality) both deserve their share of blame and if Detroit is to survive all of us need to get past dogmatic positions and pay attention to the ultimate target.

[ckissick]

Business Week has a good write-up on VW here:

http://www.businessweek.com/globalbiz/content/aug2006/gb20060822_430027.htm?chan=search

One key point in this article is that "Its German factories run at a loss of several hundred million dollars a year." Bottom line, they are the least efficient automaker in the world.

[Moneyguy1]

Economies of scale almost killed Ford. The Model T changeover to match GM's newer, more modern designs cost Ford nearly 250 million since the Ford plant was monolithically designed around the Tin Lizzie. After WWII. there was not much left to Japanese production capacity. Starting from a "clean sheet, their approach was different than the US methods. People were trained to do more rather than fewer tasks. Any worker had the right to push a button and shut down the line if a problem occurred. This reduced the need for separate inspection departments since every worker was expected to also be a quality control person. Once a line was working, management would challenge the workers by removing 10% of the line workforce and see if the production level could be re-established, how long it took and whether quality levels remained the same. Lean production. The ability to change major die sets in hours, not days. Model changeover in days, not months or weeks.

Different philosophy, built on the American model of the assemble line, but modified to include the human factor rather than eliminating it, making the worker an intergal part of the whole.