Robin Garr wrote:TP Lowe wrote:Without the union expense issue I suspect it would have just been a slower decline.
Yeah, but isn't this really where the rubber meets the road? What you're saying - and what Walmart and many other corporations say - is that labor is an expense to be trimmed as much as possible in the pursuit of profits. The two-way contract (not union but moral) between management and labor is pretty much out the window without a strong union movement to keep it so.
It could as well be argued that fossilized, stupid management (Northwest Airlines, to pick one sterling example) ought to be allowed to go out of business if they can't operate profitably without screwing their workers, busting their unions and stealing their pensions.
Wow, that's twice today that I think you've read something into my statement that I don't think was really there. All I was doing was wrapping in my earlier statement to draw the conclusion that the American auto industry has been in a decline for many reasons, including what I consider overreaching union contracts. Even without the union contracts they would be in decline for all the reasons others have pointed out earlier by others.
Now, as to cost cutting: the reality is that it is the job of management to consider all inputs into the bottom half of the income statement and try to minimize them to the extent it makes sense. Some companies clearly think personnel costs are sacred, others do not. I suspect you will choose your vendors with your opinion of that in mind - nothing wrong with that, it's part of the American way (as is everything else we've debated today and previously).