Forged Parts

[Terry M.]

Re: Forged Parts

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.

Chuck, you are singing my song.

Some of you have heard me say this, and I firmly believe it: "The only thing more expensive than a good education, is NO education!" And if you want to know what a good education can cost, just ask me -- I have paid for it, and my daughter has worked her a$$ off for it, and at 28 she is not done yet. I hope and pray she can have reasonably close to the same standard of living we have been able to enjoy.

I'm not sure we are leaving the world a better place for our children, but I sure hope we are. It will surely be a tougher place for them.

[Chuck S.]

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"

Well, it keeps everything centralized and reasonably dependable, and that's a good thing...that was pretty much the objective of vertical integration that car makers once embraced from the time of Henry Ford.

But...You can figure that every time another level of administration is integrated into a business process, the added administrator doesn't do it as a free service; it is essentially contract labor and there is an additional cost to the product for the administrative fee and profit. For the car makers, it's primarily about risk and uncertainty of increased costs, rather than simple manufacturing costs which they can pass on to the customer...with outside labor in the plant, someone else is assuming the risk for employee wage and benefit uncertainties, retirement benefits, health care costs etc. There are other risks, such as meeting quality standards, meeting objectives and schedules, etc. but the car maker plans to hold the outside administrator's feet to the fire for meeting those requirements.

When we observe the difficulties the former GM operations are experiencing, GM management back in the day is beginning to look REALLY SMART for "DIS-integrating" when they did. At first glance, it reduced their risk and gave them flexibility to procure from cheaper sources if available.

BUT, they failed to think all the way through the process IMO...if you remain the primary customer (80%) of a former corporate division, you have NOT eliminated risk to your own operations. If the former division ceases operations because of bankruptcy or work stoppage, your production is ALSO stopped until you can quickly find and qualify a new supplier.

The AAM strike cost GM $800 Million, and that was the GOOD scenario...they had excess inventory that needed to be drawn down. They threw $200 million into the AAM negoitiation process just to sweeten the deal, and try to get them back to work. As I said in my first post, I can't see this agreement as a long term stable solution for AAM, regardless of how labor views the contract...perhaps GM is adding enough cash to keep AAM afloat, and thereby maintain their own production, until another supplier can be identified (Hello, Korea!).

In today's world, an unanticpated supplier qualification is going to take time and be very expensive. Plus, negotiation leverage in that event is next to nothing...they know they have the potential customer over a barrel. Being forced to find a new supplier fast translates into lost sales, and eventually, price increases that hurt future sales in a competive marketplace.

[Bruce F.]

Re: Forged Parts

Scanning through the recent comments I agree health care costs are a big issue, but as a business owner operator I recognize a bigger problem in our income & business tax structure! I believe if we want to see America become a great manufacturing base once again the current tax structure must be changed. This is why most company's are leaving the US. (including big oil that has long ago left)..... For those of you that have not read the "Fair Tax Book" I would highly recommend the read! It sure makes a lot of sense and is backed by over $20 mil in research. If the US does not implement this Idea I'm sure some other country will recognize its worth and adopt it. Then watch what little manufacturing thats left here disappear!

[Chuck S.]

Re: Forged Parts

Chuck, you are singing my song...

I hate to say it, but we are beginning to sound like Ben Stein...my words could have been a direct quote. My opinion is we could do a lot worse for someone to emulate...well, except for looks. HaHaHa...

[Henry S.]

Re: Forged Parts

Even though companies have the right to move their plants to whatever country suits them best, that still doesn't allow them to bring and sell merchandise in the United States if their product is not up to snuff. We have all seen what problems that creates with the lead base paint or tainted meat for a couple examples. While those two examples are just a drop in the bucket compared to how many foreign goods are actually shipped in, they are still cause for concern.

On a level playing field I still have confidence we, Americans, can still produce as good or better products than any other country. But we all know level playing fields are a thing of the past.

[John H.]

Re: Forged Parts

Forging has become one of the popular manufacturing processes to export due to its nature - energy-intensive (massive furnaces to heat blanks bright red), labor-intensive (parts are still handled manually from one set of dies to another, up to five sets, in the forging press while red-hot), and filtration, treatment, and disposal of large quantities of quenching oils and water. Forging is an ancient technology that's extremely difficult to automate, with dismal productivity.

Several OEM's outsourced their forgings to Metaldyne six years ago, and now Metaldyne (largest independent supplier of forgings) is getting out of the forging business in the U.S. due to the inability to compete due to escalating energy, labor, regulatory, and environmental compliance costs.

[John C.]

Re: Forged Parts

[quote=Clem Zahrobsky (45134);347596]

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.

Nope, they have factories which basically ensure their workers will die agnozing, painful deaths earning what is decent wages for China, but a pittance in the U.S. Greed is greed is greed. To sacrifice the health of your workers to line your pocketbook is a trait of capitalism (which is growing like a plague in China) and is foreign to the teachings of Christianity.

Don't like what I say? Tough. I don't care for crappy attitudes toward other Americans.

You can badmouth unions all you want but they created the middle class. Now they get no support from the greedy Republican scum that has inhabited the white house for 8 years.

Take your butt over to China if you think it's so great.

[Henry S.]

Re: Forged Parts

[quote=John Cork (35490);347863]

Nope, they have factories which basically ensure their workers will die agnozing, painful deaths earning what is decent wages for China, but a pittance in the U.S. Greed is greed is greed. To sacrifice the health of your workers to line your pocketbook is a trait of capitalism (which is growing like a plague in China) and is foreign to the teachings of Christianity.

Don't like what I say? Tough. I don't care for crappy attitudes toward other Americans.

You can badmouth unions all you want but they created the middle class. Now they get no support from the greedy Republican scum that has inhabited the white house for 8 years.

Take your butt over to China if you think it's so great.

Well said John. With the bashing the Republican Party has given unions since Reagan was President most workers (hourly and salary) don't have a clue that ALMOST ALL OF THE BENEFITS they cherish was won on the backs of unionized labor. Many died for those rights.

[Clem Z.]

Re: Forged Parts

i posted that the govt was the problem with all it's mandated rules on cars and indusry in this country how did we get to the unions ????