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Originally Posted by boingo82
General Motors and Ford are suffering because they have to discount their cars to sell them.
They have to discount the cars, because they have overproduced for demand.
They have overproduced, because their employees are unionized, and they have too many plants they can't afford to operate at half-output.
If they are going to survive, they need new products that the public will latch onto.
They NEED to stop producing 1998 Tauruses and selling them as program cars.
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The "big 3" have a different approach to building cars. They crank the lines to maximum output and fill thousands of acres with unsold cars which have to be discounted heavily before every new year launch. This is a self defeating scheme which results in them shooting themselves in the foot by lowering the price to break even or below just to get rid of the excess inventory. The real problem is that there are just too many gas guzzlers in the lineup. The gas guzzler has become unaffordable for the mainstream consumer and it will take some time to retool for cars that people will actually buy. The Asian manufacturers are well known to be the very best in regards to efficient, reliable cars and it will take more time for domestics to get the level of respect that Toyota and Honda (and now even Hyundai) are getting.
GM is responsible for 2.5 retirees for every employee working and this number will get worse with coming layoffs.
Major changes will have to take place to let the "big 3" regain some of their lost market share.
Another interesting statistic.........The average wage at a Chinese auto plant is $0.95 cents/hr.!
The auto industry in general is in for some rough times.