Forged Parts

[Joe L.]

Some of the components used on C1, C2, and C3 Corvettes were forged pieces, including some engine, driveline, and chassis pieces. For the most part, these pieces were manufactured internally by GM at its 2 forging operations in Detroit, MI and Tonawanda, NY. As far as I know, those are the only 2 forging facilities that GM ever operated in the US, Canada, or Mexico.

About 15 years ago, GM sold off these forging plants as well as some other related manufacturing operations. A new company, American Axle and Manufacturing, was thus born. This company continued to be a major supplier to GM for the same sort of products that GM had manufactured in those facilities. AAM also supplies other major auto manufacturers, but GM has remained its primary customer.

AAM, which at its birth was wholly a US manufacturer, has been diversifying its manufacturing operations to other countries, notably Mexico. From what I've been reading, they have their eye on China, India, and Russia, too.

Several weeks ago, AAM went on strike at all of its plants. This has caused a major disruption to GM. Apparently, though, AAM and the UAW have just agreed on a tentative contract. This contract has the usual major reduction in wages but it's "tempered" by a cash "bonus" to be paid out over 3 years to allow the workers to transition to the reduction in hourly wage.

The other thing that's, apparently, going to come out of the new contract and the primary reason I am posting this is the contract provides for the closure of both the Detroit and Tonawanda forging plants. Along with them go a lot of Corvette history and the "birthing location" of many of the components used in our cars. It also means that unless AAM establishes forging operations elsewhere, it will no longer be a supplier of forged components to GM. Since GM has not had any of its own forging operations, that means that all forged pieces will have to come from "elsewhere". Even if AAM does establish new forging operations, I am very confident those will be in Mexico, China, India, or Russia. So, get ready for even more non-US content in Corvettes of the future.

Not only are the forging operations to go, but AAM shut down their Buffalo plant about a year ago. The Buffalo plant, formerly part of GM Powertrain, subsequent to its being cast off to the Saginaw Division and originally known as Chevrolet-Buffalo, was the source for most of the steering linkage as well as other chassis parts on C1, C2, and C3 Corvettes.

So, as I say, a lot of the manufacturing history of C1, C2, and C3 Corvettes is about to go to the "scrap heap". There's not too much left of the manufacturing infrastructure that created the cars so dear to us.

[Chuck S.]

Re: Forged Parts

Here are the agreement details: http://biz.yahoo.com/ap/080517/american_axle_labor.html

I would love to see a detailed analysis of the company's offer and their thinking...I hope they have a better "over-the-horizon" strategy than the concessions that got the US car business into this bind. I don't see where AAM goes from here...according to them, not even cutting hourly wages nearly in half will make them competitive with their domestic competitors, but maybe that's negoitiation jawboning.

The "buyouts" to ease the transition to lower wages are $90K over three years for every hourly employee, and the union membership is talking like they would be schmucks to approve the contract. If AAM is closing the forging operations, what's left for these employees to do?...machining operations on imported forgings?

Rather than commit to these "buyouts", I wonder why they don't just move everything abroad now, but GM may be involved behind the scenes. Some will say this thinking is unpatriotic, but business is business...if you don't make a profit, you won't be in business long, and that hurts everybody.

[Joe L.]

Re: Forged Parts

Here are the agreement details: http://biz.yahoo.com/ap/080517/american_axle_labor.html

I would love to see a detailed analysis of the company's offer and their thinking...I hope they have a better "over-the-horizon" strategy than the concessions that got the US car business into this bind. I don't see where AAM goes from here...according to them, not even cutting hourly wages nearly in half will make them competitive with their domestic competitors, but maybe that's negoitiation jawboning.

The "buyouts" to ease the transition to lower wages are $90K over three years for every hourly employee, and the union membership is talking like they would be schmucks to approve the contract. If AAM is closing the forging operations, what's left for these employees to do?...machining operations on imported forgings?

Rather than commit to these "buyouts", I wonder why they don't just move everything abroad now, but GM may be involved behind the scenes. Some will say this thinking is unpatriotic, but business is business...if you don't make a profit, you won't be in business long, and that hurts everybody.

Chuck-----


Yes, that's about the way it is. With the closure of their Buffalo plant and the, apparently, impending closure of the Detroit and Tonawanda Forge plants, AAM is going to be left with a VERY reduced USA "manufacturing presence". They will still have their Detroit manufacturing operations (minus the forge) plus relatively small machining operations in New York and a relatively small driveline products manufacturing operation in Three Rivers, MI. What started out as 5 ex-GM manufacturing plants will now be a "global company".

As I say, we are going to see increasing foreign-manufactured content in Corvettes. At some point in the not-too-distant future, the Corvette may become a PRIMARILY foreign-content product. You see some manufactured goods out there now that say something like "assembled in Mexico from US-manufactured components". The Corvette will be "assembled in the US from foreign-manufactured components".

But, be that as it may. My primary purpose for posting this story, at all, was simply to point out that more of the "birthing locations" for the components of the cars we cherish are "going away". St. Louis is gone. Detroit Corvette plant (1953) is gone. Flint Engine is gone. Most of Delco Remy manufacturing in Anderson, IN is gone. Most of Delco Chassis in Dayton, OH is gone. AC Products manufacturing operations in Flint, MI are gone. Ionia, MI (alternate C2 body production site) is gone. Chevrolet-Buffalo is gone. Tonawanda and Detroit Forge are soon to be gone. Not much left.

[Clem Z.]

Re: Forged Parts

it is not only the wages that cause these decisions but the government rules and regulations that keep changing with no guarantee what will come up down the road.

[Christopher R.]

Re: Forged Parts

it is not only the wages that cause these decisions but the government rules and regulations that keep changing with no guarantee what will come up down the road.

That's not a problem in the US. Our laws and regulations are stable. That's much more of a problem in other parts of the world, especially in developing countries such as India, China, Brazil, etc.. Business people all over the world admire the US as a stable place to do business.

What hurts the US, especially in manufacturing, is health care costs.

[Jeff S.]

Re: Forged Parts

Joe

I worked at Chevrolet-Detroit Forge in the mid-60's for several summers while a college student & briefly after graduation. It was a tough environment; IIRC, the hammermen were compensated in part by 'piece work' on the number of parts made. Many of the forgings went right down the street (St. Aubins & Holbrook?) to the Gear & Axle plant. Also, the central laboratory for all of Chevy Motor Division was located at the forge. Chemistry, metallurgy, physical testing, x-ray radiography, etc was all conducted there in very well equipped facilities under the chief metallurgist. Samples from every 'outside' supplier as well as parts manufactured by Chevrolet or other GM entities were destructively tested at this location -- not at the Tech Center as many believed. I read of the American Axle labor dispute, but am sad to hear your news regarding the forge.

[Joe L.]

Re: Forged Parts

Joe

I worked at Chevrolet-Detroit Forge in the mid-60's for several summers while a college student & briefly after graduation. It was a tough environment; IIRC, the hammermen were compensated in part by 'piece work' on the number of parts made. Many of the forgings went right down the street (St. Aubins & Holbrook?) to the Gear & Axle plant. Also, the central laboratory for all of Chevy Motor Division was located at the forge. Chemistry, metallurgy, physical testing, x-ray radiography, etc was all conducted there in very well equipped facilities under the chief metallurgist. Samples from every 'outside' supplier as well as parts manufactured by Chevrolet or other GM entities were destructively tested at this location -- not at the Tech Center as many believed. I read of the American Axle labor dispute, but am sad to hear your news regarding the forge.

Jeff-----

The forge and the old gear and axle plant are both part of the American Axle & Manufacturing Detroit "complex". I believe their intention is only to shut down the forge, and I don't know when they actually plan to do this. I would assume sometime during the duration of the contract, though. The rest of the "complex" will remain. For the immediate future, at least. The complex is located on Holbrook Avenue. AAM has its world headquarters at the complex, too. It's a new facility I think they built since acquiring the complex from GM. It's located on a short street, Dauch Drive, named for the "company founder", Richard Dauch.

[Clem Z.]

Re: Forged Parts

[quote=Christopher Ritchie (238);347502]That's not a problem in the US. Our laws and regulations are stable. That's much more of a problem in other parts of the world, especially in developing countries such as India, China, Brazil, etc.. Business people all over the world admire the US as a stable place to do business.

What hurts the US, especially in manufacturing, is health care costs.[/quote} telling them they have to install seatbelts,air bags,CAFE,leave to take care of newborns and stuff like that is not the govt business. the govt caused the health care mess when we had govt wage and price controls the companies started to gave health care instead of wage increases. i bet they don't have this stuff in china.

[Henry S.]

Re: Forged Parts

Here are the agreement details: http://biz.yahoo.com/ap/080517/american_axle_labor.html

I would love to see a detailed analysis of the company's offer and their thinking...I hope they have a better "over-the-horizon" strategy than the concessions that got the US car business into this bind. I don't see where AAM goes from here...according to them, not even cutting hourly wages nearly in half will make them competitive with their domestic competitors, but maybe that's negoitiation jawboning.

The "buyouts" to ease the transition to lower wages are $90K over three years for every hourly employee, and the union membership is talking like they would be schmucks to approve the contract. If AAM is closing the forging operations, what's left for these employees to do?...machining operations on imported forgings?

Rather than commit to these "buyouts", I wonder why they don't just move everything abroad now, but GM may be involved behind the scenes. Some will say this thinking is unpatriotic, but business is business...if you don't make a profit, you won't be in business long, and that hurts everybody.

Just because someone else in the world will work for a dollar a day doesn't mean Americans have to. People are all too eager to jump on workers for not accepting their wages to be cut by a third. Many of these workers have spent 20-30 years possible at that job and probably hurts more than just their pocketbook when a company decides to move "out of country". I worked for Firestone for 29 1/2 years when they decided to close the Decatur plant leaving 1200 jobless. Loyalty among most CEOs nowadays go no further than the bottom line. Is the CEO and the upper executives giving up a third of their salary also?? I don't believe a company should open their wallet and let the workers have whatever they want. From my standpoint neither side wants to do much negotiating anymore. It's more like "this is our only offer take it or leave it" or when the contract is up they just lock them out. Our government makes it easier for a company to close it's doors and move overseas than work a little harder to keep plants open here. I say if they want to make their crap in China let them sell it there too!

Their was an article a few years ago about the grade of steel in China not being up to the U.S. standards. I wonder how many of the parts they will be shipping back to the "Good Ole USA" will be sub-par?? If you have looked at a car lift in the last 10 years or so you have probably seen it. Nowadays how many companies are selling lifts that have most their parts made in China or overseas?? Lifts from different companies probably go down the same assembly with the only difference being a little "tweak" here or there and a name change. Many companies brag about it being "assembled" in the U.S. I've heard before about their steel being made out of some of our junk like old sunglasses (Made in China) and crap like that. Think about it next time your standing under a lift made in China. Just remember what they say "It's hard to make chicken salad when you start out with chicken sh** "!!

Shooter

[Joe L.]

Re: Forged Parts

Just because someone else in the world will work for a dollar a day doesn't mean Americans have to. People are all too eager to jump on workers for not accepting their wages to be cut by a third. Many of these workers have spent 20-30 years possible at that job and probably hurts more than just their pocketbook when a company decides to move "out of country". I worked for Firestone for 29 1/2 years when they decided to close the Decatur plant leaving 1200 jobless. Loyalty among most CEOs nowadays go no further than the bottom line. Is the CEO and the upper executives giving up a third of their salary also?? I don't believe a company should open their wallet and let the workers have whatever they want. From my standpoint neither side wants to do much negotiating anymore. It's more like "this is our only offer take it or leave it" or when the contract is up they just lock them out. Our government makes it easier for a company to close it's doors and move overseas than work a little harder to keep plants open here. I say if they want to make their crap in China let them sell it there too!

Their was an article a few years ago about the grade of steel in China not being up to the U.S. standards. I wonder how many of the parts they will be shipping back to the "Good Ole USA" will be sub-par?? If you have looked at a car lift in the last 10 years or so you have probably seen it. Nowadays how many companies are selling lifts that have most their parts made in China or overseas?? Lifts from different companies probably go down the same assembly with the only difference being a little "tweak" here or there and a name change. Many companies brag about it being "assembled" in the U.S. I've heard before about their steel being made out of some of our junk like old sunglasses (Made in China) and crap like that. Think about it next time your standing under a lift made in China. Just remember what they say "It's hard to make chicken salad when you start out with chicken sh** "!!

Shooter

Shooter-----


I'm not an advocate of the "exportation" of US jobs. Quite the contrary. I view the loss of US manufacturing capacity as one of the worst things that's ever happened to this country and it has HUGE long term NEGATIVE consequences. But, getting into all that sort of thing on this board is probably inappropriate so I'll let it go at that.

One technical correction, though: China does make a lot of its steel and iron from scrap metal. However, so does the US. Scrap metal is a basic feedstock of the industry. It's not how the iron or steel begins; it's what it's like after production that counts. The fact is that the Chinese have purchased and operate just about the finest steel manufacturing equipment in the world. In some cases, they purchased modern German steel manufacturing plants "lock, stock, and barrel" and transplanted them to China. In other cases, they've purchased complete new facilities from German steel making equipment manufacturers. So, they have among the best steel manufacturing facilities in the world now. We don't have to like it (and, I don't), but that's the way it is.

[Chuck S.]

Re: Forged Parts

...Just remember what they say "It's hard to make chicken salad when you start out with chicken sh** "!!

Well, Henry, at least there is some truth in that statement...the rest of your post sounds like a collection of baseless, unrelated accusations and conspiracy theories from meeting over beers at the pub.

I'm not jumping on them for not taking a wage cut...I don't care if they ratify the agreement or not. Those guys working there now haven't lived long enough or worked there long enough to NOT KNOW, assuming that they can read a newspaper or watch TV news, that those manufacturing jobs were at risk from the first day they worked there. They act like they just woke up from a long nap they began in 1970; Well, while they slept, the world changed.

You read the litany of former GM manufacturing operations Joe named that are now history...when I read it, I was filled with a sad nostalgia. I'm sure each of those companies found themselves at this intersection, and failed to reach agreements with labor, or just gave up trying to continue maintaining the wages and benefits that American workers were accustomed, and moved their operations offshore.

The fact is, not just union workers are going to be affected by these changes; all our children and their children are likely to experience a decline in living standards. We have lost our competitive manufacturing edge versus the world, and yes, it's because they will work a lot cheaper, and they can buy food and clothing of their own manufacture cheaper.

Unless we are able to continue to educate our people (Yes, people...STAY IN SCHOOL AND EXCEL!) and reinvent ourselves with new technology, the decline in future living standards will continue until competitive economies begin to achieve the same level of success as the USA achieved, and develop a taste for imported goods. Maybe by that time, if our dollar is cheap enough, our wages low enough, and our goods top quality, we'll be able to sell them more. This assumes sympathetic pandering politicians don't see isolationism as the way to maintain union wages.

[Clem Z.]

Re: Forged Parts

this may be why all the industry is leaving the USA. http://info.detnews.com/video/index.cfm?id=1189

[Henry S.]

Re: Forged Parts

Well, Henry, at least there is some truth in that statement...the rest of your post sounds like a collection of baseless, unrelated accusations and conspiracy theories from meeting over beers at the pub.

I'm not jumping on them for not taking a wage cut...I don't care if they ratify the agreement or not. Those guys working there now haven't lived long enough or worked there long enough to NOT KNOW, assuming that they can read a newspaper or watch TV news, that those manufacturing jobs were at risk from the first day they worked there. They act like they just woke up from a long nap they began in 1970; Well, while they slept, the world changed.

You read the litany of former GM manufacturing operations Joe named that are now history...when I read it, I was filled with a sad nostalgia. I'm sure each of those companies found themselves at this intersection, and failed to reach agreements with labor, or just gave up trying to continue maintaining the wages and benefits that American workers were accustomed, and moved their operations offshore.

The fact is, not just union workers are going to be affected by these changes; all our children and their children are likely to experience a decline in living standards. We have lost our competitive manufacturing edge versus the world, and yes, it's because they will work a lot cheaper, and they can buy food and clothing of their own manufacture cheaper.

Unless we are able to continue to educate our people (Yes, people...STAY IN SCHOOL AND EXCEL!) and reinvent ourselves with new technology, the decline in future living standards will continue until competitive economies begin to achieve the same level of success as the USA achieved, and develop a taste for imported goods. Maybe by that time, if our dollar is cheap enough, our wages low enough, and our goods top quality, we'll be able to sell them more. This assumes sympathetic pandering politicians don't see isolationism as the way to maintain union wages.

Chuck,
I didn't make those comments towards you personally. I apologize if that is the way it came across. I have a hard time expressing what I want to say on paper so many times it doesn't come out right and I end up ranting. While each of us want future generations to be more successful than ours there's a part of us that would like them to be able to experience some of the joys we have had. Hopefully we are doing that through our cars from that era. I haven't been a Corvette owner for that long but I still have a lot of great memories as we all do about "life in the 50's and 60's". Both my boys are successful but unfortunately as they say school isn't for everyone. That's the kids that are getting left behind and the ones that will miss out on all the factory jobs lost. As Joe said this board is not the place for this (the direction I took) and I agree. My intent was not to offend anyone personally on this board, I respect the hard work each of you have put into it too much for that.

Sincerely,
Henry Shoot

[Chuck S.]

Re: Forged Parts

this may be why all the industry is leaving the USA. http://info.detnews.com/video/index.cfm?id=1189

I can't see the video, but if it has to do with forgiveness of taxes, and other relocation incentives like free land, I totally agree that those contribute. That's how our federal government facilitated the building of the first transcontinental railroad track.

Labor is only one cost component of manufacturing, but it is a large part of the equation...smart management looks at all the costs and benefits when deciding where to locate (or relocate) a manufacturing plant, or any business for that matter.

Federal and local property taxes, available governmental incentives, environmental regulations and costs, human resource regulations and costs, cost of land for plant site, construction costs, availability of educated and skilled labor, proximity to and cost of transportation, availability and reliability of power, availability of essential natural resources like water...there are hundreds of parameters to be considered.

There are software programs that will ask the right questions, and grind the answers to spit out the best overall location for a company. Of course, the "best overall location" is instanteous, because all of these governing conditions are subject to change.

Not even all the US states are equally attractive for manufacturing operations. The residents of some states and their elected representatives have been decidedly unfriendly to manufacturing for decades, and now they are seeing the consequences. States that once enjoyed a thriving manufacturing base now see businesses moving out, but they don't move in. The "Governator" and his wife are doing TV ads to encourage business relocation to their state; successful actors are encouraging companies to get "an upper hand" from their state.

I recently saw an interiew of the female mayor of Dallas on the Texas Cable News channel. The interviewer was asking about the forecast budget shortfall for Dallas due to mini-recession that's occurring, and her plans to bring the municipal budget back into balance. The "rocket-scientist" politician's answer: We're going to RAISE PROPERTY TAXES, and cut a few services, but not public safety (cops have unions).

So, now, if you have half a brain, you see what goes on with incompetent government: in the best of times, tax revenues are through the roof and the politicians bathe and wallow in the largesse; in the worst of times when tax revenues are down, they raise the taxes again to pay for public services they committed to during the "best of times". The tax burden NEVER goes down; it just rachets up decade after decade.

[Clem Z.]

Re: Forged Parts

it shows that there are other parts manufactures,non ford, in the plant that produce and install their products on the production line which the unions in this country will not allow. there is no expense of shipping of parts from other plants involved in the production of the car as it is all done under "one roof"