Here's hoping the ghost of Juan-Gone doesn't haunt striking American Axle workers
By RightMichigan.com Posted in Breaking News | Detroit | jennifer granholm | Michigan | right to work | strike | thug | UAW | union thugs — Comments (1) / Email this page » / Leave a comment »
Cross-posted on Right Michigan at www.RightMichigan.com.
While fifty Michigan families in the Grand Rapids area adjust to the news this morning that Fifth Third Bank is killing their jobs the news continues to be just as bleak on the east side of the State. American Axle is shuttered for the third day while workers continue marching the picket lines "backed" by their well paid union bosses at the UAW. The strike has affected more than just AA, leading to a shutdown of one automobile production facility thus far and threatening more auto jobs as time passes without a deal.
Detroit has seen it's fair share of labor unrest in recent months what with the UAW walking off the job while negotiating new contracts with the Big 3. But the feeling, afterwards, has generarlly been that things worked out well and everyone involved was a relatively good actor. Not in the "Hollywood" sense of the word but in the "active participant" sense of the word. The union might have a tougher time saving face as details of the contract battle at American Axle hit the wires this morning. And I, for one, can't help but think back to the biggest mishandling of a contract in the history of professoinal sports. But first, American Axle.
Daniel Howes writes in the Detroit News:
Dauch and two partners founded American Axle on March 1, 1994, from General Motors Corp.'s decrepit axle and forge operations. Now he and his company are facing the kind of squeeze that defines legacies, shapes corporate strategies and, for the staunch defender of industrial America, determines how committed Dauch truly is to reviving manufacturing in his own country...
"We are not an" automaker "and we never will be," he said. American Axle's "$73.48 (an hour) all-in labor cost is over 300 percent higher than my competitors in the United States. Our competition is in the $20 to $30 range, all-in."
Some 3,600 UAW members at five facilities walked out early Tuesday in a dispute centering on American Axle's push to bring wages and benefits sharply lower and in line with rivals operating union shops in the United States -- a discussion Dauch says has been under way for 28 months.
"We took over an absolutely troubled set of assets and nobody is going to hold us hostage," (American Axle boss Dick Dauch) told me in an interview Thursday. "The last three days we've been sitting here ready to negotiate and nobody's showed up."
Not a good sign when the union refuses to even show up for negotiations. Apparently they're content, for the time being, to let their members stand outside in the Michigan winter, surrounding barrels with burning logs to stay warm, painting a sad, sympathetic picture in the media and hoping the pressure will mount on company execs.
But when you see those numbers... 300% higher than competitors? And let's look at this from a Michigan point of view, shall we? American Axle's chief competitor is Dana Corp. They're an Ohio company. Their compensation is in line with the industry standard. So while out-of-state companies continue to provide semi-insanely high wages and benefits ($30 an hour isn't $73.48 but it's still nice) the unions are pushing a Michigan company to the brink of insolvency.
Two years ago AA posted a nine-figure ($200 plus million) loss. Last year they managed to make about thirty-seven million of that back. But when the competition can provide product at a substantially better price because their labor costs are less than a third (sometimes closer to a fourth) that puts this Michigan company at a serious disadvantage and risk of insolvency.
I know, I know. It's a negotiating tactic. It's SOP for the boys at the UAW. All that may be true. But you'll forgive me if I'm not a fan of the status quo.
All that said, I'll never begrudge a worker attempting to get what he can get. If you've got leverage, use it. Athletes do it all the time in professional sports. Some folks find it distasteful but I don't have a problem with it at all. I'd just caution everyone to remember the lesson of Juan Gonzalez. Years and years ago, back in the days of Tony Clark, Dean Palmer and Bobby Higginson, the Detroit Tigers wanted to make Juan-Gone a $100 million man and he turned them down deciding instead to pursue more jack elsewhere. He didn't find it and he was injured almost immediately effectively ending his career.
Undoubtedly the man was a knucklehead but he almost certainly got some really bad advice from the people around him as well. Same thing might be happening again in Detroit, though the future of American Axle affects thousands more than a sweet deal for a ballplayer ever will. Then again, at least Gonzalez had an agent negotiating for him. Apparently the UAW workers standing outside in the cold this morning can't say the same thing.
Juan's money wound up vanishing forever. With Michigan's economy being what it is, and faced with competition from manufacturers in other states with radically lower production costs the union bosses are walking a dangerous line. Push too hard and American Axle might vanish forever, too. And that would really leave thousands of workers out in the cold.
It is no secret that AAM and the UAW are at odds with the new contract. It is no secret that the rumors, of the proposed contracts, are going to hurt thousands of families. And, it is no secret that we, as AAM families, simply can’t stand for it.
AAM states the Detroit facilities are losing money. Consequently, it is our fault and we need to take a pay cut to adjust their profits accordingly. Well, I wonder if Mr. Dauch knows how his plant is mismanaged and that he is misinformed by his management. There are quite a few costly issues with the Forge. Issues that have been discussed with management numerous times. Issues that could save AAM considerable amounts of money. He needs to come down to the floor and speak with the men and women that work hard for him and honestly know the” ins and outs” of their machines and departments. He would hear honest opinions and thorough suggestions that would better productivity. It would change his idea of what his workers really do and in time will even see better profits. I guarantee it!
Processes are not clarified. Like re-run steel; steel is scrapped after it is run through the induction heater twice. No documentation supports this action. The Quality Supervisor states steel can be run through more than twice. Usually this steel is scrapped. Many racks of this steel are scrapped annually. How much money is lost on a whole rack of good steel being tossed out.
We had a period of time where no Preventative Maintenance had been performed on the Upsetters for many years. Employee’s are blamed for these machines not running or when we can’t obtain a quality part.
Supervisors just want to be a boss. It’s all about clicking with the Upper Management and covering their own rears not the hourly employees. Supervisors just want to look good for Dauch and Upper Management. We have been told, on Numerous occasions, when Dauch walks through the plants, to just keep the machines running even if we are only making scrap. They think they are showing Dauch that we are “running strong”. Dauch needs to walk in Unannounced. He will see the real way his plant is being run. It is like a dog and pony show if they know he is coming through.
Shotblast and Bender Operators become supervisors. An Agricultural Engineer running the Upset Department? Finance people become Area Supervisors and then Plant Managers? How can a 3 month Supervisor tell a 14 year vet what to do and how he should do it? Who would you want to teach you on the workings of an Upsetter; Management with a degree that has nothing to do with Manufacturing or an employee that has been running and repairing that machine for 14 years? These people have no idea the skillfulness and intricate modifications that are done to produce a quality part. Some of these modifications are needed due to the lack of preventive maintenance mentioned above.
There has been “big money” wasted on past processes that we don’t use anymore. Example: We implemented a new tagging system that failed TWICE. How many hours were wasted organizing and building this system, TWICE? How much in materials wasted, TWICE? By the way, we aren’t using this system …again. Yet, you won’t listen to the suggestions that will really save you money. Like the scrap mentioned above, or cutting small rubber mats out of the big used rubber mats to save money. Why buy small ones when we can reuse big ones? How many thousands of dollars would that have saved over the years? Somehow Management doesn’t think it’s a good idea! Who makes these decisions? I want to see them on St. Aubin begging for their jobs. These are some of the reasons why we feel we are being set up for failure. Imagine the money saved if someone listened to us years ago. Really, years ago.
AAM spent $150,000 to develop a class that would train and instruct us on how to run and repair an Upsetter. 4 people took the course (I was one of them) and there were numerous errors in the textbook and on the video. This is a training video and there is a safety violation RIGHT ON THE VIDEO! It is a shame that an hourly worker is looked at as disposable and useless. It is ironic that the same employee is the one who is correcting your textbook and has to educate the “teacher” on the finer points of Forging.
We have gone for years without the proper tools. At one time we had them. Then Management took them and threw them away because they were going to “re-do” the system. We have never received replacement tools. This causes much more down time and consequently money is wasted…again.
As we all know, Toyota is an important client. Then why is the quench protection for Hino shafts barely operable? Equipment is broken. The process is hardly documented; as we have been instructed to do. The whole process needs to be re-evaluated. Good parts are continually being scrapped in large quantities. Modifying this process would save a lot of money for AAM and maybe even Toyota.
Then there are safety issues. There is plexiglass in the windows of an overhead crane. OSHA standards require shatterproof glass. Maybe I should mention the Upset crane that doesn’t have brakes. The list can really go on and on. Safety issues are ignored until we are fined or somebody gets hurt. 2 ½ years it took to put a mirror inside the bay door of the Upset department so Hi-lo’s won’t injure people.
While Mr. Dauch, was at Chrysler, he was quoted as saying “We would go in, stop operations, and talk to people” You felt it was important to hear what the workers had to say. Why not now when it is YOUR OWN company? Who better to give you insight on the struggles or successes on the floor? It has been said that you are purposely ignoring these issues because you want the Forge to fail. We know you want to shut it down. And who better to blame than the hourly employees that manufacture these products. I don’t want to believe that. Who in their right mind would want any part of their company to purposely fail? But how can such a shrewd businessman let all of this go on under his nose and be none the wiser?
I don’t need to quote all AAM and Dauch’s profits,. We have heard it many times. We all know about his large salary, bonuses etc while the company lost 222 million dollars in 2006. We are all aware of the bonuses of Upper Management. But not one of them are willing to take a cut. Do you even consider the consequences your actions are going to have on our families? 3600+ people will lose their homes and maybe even their cars. Some of your employees have spouses or other family members here too. So, in their case you are affecting two salaries in one household. In our situation, my wife has already taken a pay cut similar to the one we have heard you suggest. We simply can’t do it again. I am a forth generation Forge employee. I have worked for your company for 14 years. We have built a life around AAM and our pay. You can’t just take 60% of our pay and benefits and not expect a fight. What is left after I pay benefits with $11.40 an hr? How can I support my family with that? How would you support your family with that? With gas going to $4.00 a gallon, how can I even drive to work on that? Of course we prefer to keep things as is. I will help pay my medical. I will even agree to taking my COLA away. (Which will save you an estimated 30 million with Cola alone). But to cut my wages the way you want to, you will have to offer a “buy out” or “buy down”. I hear you don’t want to do that. This almost seems impossible to believe. Are you so callous as to leave all these families bankrupt and homeless? I know it sounds extreme but it is very true.
With all this said; I have to say I know you have a negative opinion of the hourly worker. You feel that we are all replaceable and indispensable. I can assure you I am not. I am that worker who gives 110%. I go over and beyond. My Supervisors never have to tell me what to do because it is already done. I am never someone who says “that isn’t my job”. I can run and problem solve an Upsetter better than most people on the floor and any Manager that has come through this plant in my 14 yrs. I gave you 14 years of dedicated service and I deserve the respect as such.