Re: Query: Ford/General Motors - correction
In a message dated 7/23/2004 6:35:11 PM Central Standard Time, [EMAIL PROTECTED] writes: A per unit drop of labor input of 40% in 30 years is running at an annual improvement factor of more than 10% and what is built into the union contract is an annual improvement factor of 3% increase in wages. The 3% annual improvement factor (AIF) was actually lost during years of concessionary contracts - 1980-1993, and "re-won" in the mid 1990s. Correction 10% should be one percent. Contract negotiations took place every three years until changed in the late 1990s to a five year contract.
Query: Ford/General Motors
what is progressive economist take on ford and general motors releasng info the other day indicating that each only made profits from credit/lending operations... michael hoover -- Please Note: Due to Florida's very broad public records law, most written communications to or from College employees regarding College business are public records, available to the public and media upon request. Therefore, this e-mail communication may be subject to public disclosure.
Re: Query: Ford/General Motors
I think that this is very important. For me it signifies that the center of gravity of the economy is shifting in the direction of finance capital, except that I would include intellectual property as part of the nonmaterial properties that represent the core of finance capital. Michael Perelman Economics Department California State University michael at ecst.csuchico.edu Chico, CA 95929 530-898-5321 fax 530-898-5901 -Original Message- From: PEN-L list [mailto:[EMAIL PROTECTED] On Behalf Of Michael Hoover Sent: Friday, July 23, 2004 10:33 AM To: [EMAIL PROTECTED] Subject: [PEN-L] Query: Ford/General Motors what is progressive economist take on ford and general motors releasng info the other day indicating that each only made profits from credit/lending operations... michael hoover -- Please Note: Due to Florida's very broad public records law, most written communications to or from College employees regarding College business are public records, available to the public and media upon request. Therefore, this e-mail communication may be subject to public disclosure.
Re: Query: Ford/General Motors
accounting for the profits of lending is the second blackest of the black arts (accounting for the profits of life assurers is the blackest). There are often very substantial gaps indeed between even the best accruals accounts and cash. If the debt ends up not being repaid, this earnings stream can be very volatile indeed, particularly if the collateral is a motor vehicle. watch yer eye would be my view, although the epithets progressive and economist apply to me only marginally at best. General Motors is something like the third biggest lender in the UK's buy to let (speculative housing investment) sector - nobody knows why. dd -Original Message- From: PEN-L list [mailto:[EMAIL PROTECTED] Behalf Of Michael Hoover Sent: 23 July 2004 18:33 To: [EMAIL PROTECTED] Subject: Query: Ford/General Motors what is progressive economist take on ford and general motors releasng info the other day indicating that each only made profits from credit/lending operations... michael hoover -- Please Note: Due to Florida's very broad public records law, most written communications to or from College employees regarding College business are public records, available to the public and media upon request. Therefore, this e-mail communication may be subject to public disclosure.
Query: Ford/General Motors
what is progressive economist take on ford and general motors releasng info the other day indicating that each only made profits from credit/lending operations... michael hoover ^ You must be reading Detroit newspapers in Ann Arbor, Michael. Charles
Re: Query: Ford/General Motors
Wall Street analysts said they'd like to see GM -- as well as Ford -- make more money from selling cars and trucks. Ford is even more dependent than GM on its credit business, getting about 77 percent of its profits from there. "I think at both GM and Ford the reliance is a general concern. If you buy the stock of these companies, it's like you are buying a finance company that comes with an auto piece attached," said Daman Blakeney, an equity analyst for Victory Capital Management, which manages about $50 billion for investors. "They are supposed to be selling cars and making money at that." Worldwide, GM's profits on the sale of new cars and trucks rose to $529 million, up from $140 million a year ago. In North America, GM earned $328 million, up from $83 million a year ago. GM sales for the quarter grew 7 percent to $49.1 billion, up from $48.3 billion a year ago, largely because it sold more vehicles in Latin America and the Asian Pacific. GM continued to struggle in Europe, which has been a sore spot for years. GM had quarterly losses of $45 million, compared with a loss of $3 million a year ago. Devine said sales improved in Europe but GM's costs were too high, a signal GM may be preparing for more cuts on the continent. FULL: http://www.freep.com/money/autonews/gm22_20040722.htm
Re: Query: Ford/General Motors
Charles Brown wrote: what is progressive economist take on ford and general motors releasng info the other day indicating that each only made profits from credit/lending operations... michael hoover ^ You must be reading Detroit newspapers in Ann Arbor, Michael. It made the Chicago papers too; I can't remember now, but I think there was a brief story on it in the Bloomington Pantagraph. GM Ford are big news reverberate outside the City of Eddie Guest. :-) Carrol
Query: Ford/General Motors
It made the Chicago papers too; I can't remember now, but I think there was a brief story on it in the Bloomington Pantagraph. GM Ford are big news reverberate outside the City of Eddie Guest. :-) Carrol ^ CB: Well GM is only about the third largest company in the world now. I wonder if what's good for General Motors is still good for America. Way back in the thirties it was Alfred P. Sloan ( I think) who said GM is in the business of making money ,not cars. Nice slogan for the merger of industrial and finance capital as Finance Capital. Alfred P. Sloan - encyclopedia article about Alfred P. Sloan. Free ...encyclopedia article about Alfred P. Sloan. Alfred P. Sloan explanation. ... Alfred P. Sloan. Word: Word. ... encyclopedia.thefreedictionary.com/Alfred%20P.%20Sloan - Alfred P. Sloan. 1875-1966. ... Alfred P. Sloan Foundation Too often we fail to recognize. and pay tribute to the. creative spirit.. -Alfred P. Sloan, Jr. ... www.virtualology.com/virtualpubliclibrary/ halloffounders/automotivefounders/ALFREDPSLOAN.COM/ - 22k - Cached - Similar pages Alfred P. Sloan, Late Chairman of General Motors Corporation... The reason is that I have a famous relative, or at least my father and grandfather believed that he was our relative, namely Alfred P. Sloan. ... www.ishipress.com/al-sloan.htm - 7k - Cached - Similar pages Alfred P. Sloan Museum in Flint, MI - Details | MuseumStuff.comAlfred P. Sloan Museum details page from MuseumStuff.com, the web's leading guide to 1000's of museums worldwide. ... Alfred P. Sloan Museum. ... www.museumstuff.com/rec/org_20020201_10164.html - 7k - Cached - Similar pages ^^ High anxiety for U.S. automakers Big summer sales needed; suppliers, analysts fret July 23, 2004 BY JEFFREY MCCRACKEN FREE PRESS BUSINESS WRITER About 60 degrees and six months ago, during the Detroit auto show, there was a feeling of hope and optimism that an improving economy and slew of new and redesigned vehicles -- Chevrolet Corvette, Ford minivan, Chrysler 300 sedan -- would combine to increase Detroit automakers' sales while slowing down the rebates and incentives that wreak havoc on profits. Now, just past the year's halfway point, as second-quarter financial results pour out from General Motors Corp., Ford Motor Co. and the area's largest auto suppliers, a new feeling is in the air: uncertainty. Or nervousness. Or concern. Whatever word is used to capture it, there is a definite sense that the second half of the year needs to go better than the first for Detroit's auto industry. Already, some are warning it won't. A number of Detroit's largest auto-parts makers -- such as Delphi Corp. and Visteon Corp. -- have told Wall Street they won't make as much as predicted in the third quarter or have given less-than-rosy projections for the rest of 2004. GM, too, gave the investors and analysts that cover them a cautious view of the year. I think the real fear among these auto executives is that they only can get better auto sales with huge incentives. The automakers, like GM, misplaced their bets that better employment and a better economy would eliminate the need for these rebates and low-interest deals, and that hasn't been the case, said Diane Swonk, chief economist for Bank One Corp. There is concern that if July and August aren't blockbuster sales months for Detroit's three automakers -- especially GM -- they will have to slam on the brakes of vehicle production, which would cause a ripple effect across the industry and might push small suppliers into bankruptcy. The big fear: GM will need to idle some plants in the fourth quarter, and other automakers will follow suit. Already, GM's and Ford's plans for how many cars and trucks they will build from July through September are lower than they were last year by about 76,000 vehicles. Ford's third-quarter production plan calls for it to build 755,000 cars and trucks, the lowest third-quarter number in the automaker's history. GM's third-quarter production of 1.2 million vehicles is the lowest it has been since the 1990s and down about 4 percent from a year ago. GM and Ford will announce their production plans for the rest of the year Sept. 1, making that an important day in the immediate future of many Detroit suppliers. There are quite a few suppliers around town that are watching to see what happens because they are so dependent on GM and the domestics. If GM decides to pull back a lot, that will send a message to the whole industry and have some scary ripples for some local suppliers, said Jeff Schuster, executive director of vehicle forecasting at J.D. Power and Associates, the market analysis firm. Really, what Detroit needs is just a big, big sales month in July and August from the traditional Big Three. Schuster's firm recently lowered its production expectation for the rest of the year by about 100,000 cars and trucks. Schuster called that just a minor tweak. But noted it would have been lower, except
Re: Query: Ford/General Motors
I don't recall the exact details, but a few years ago when Rupert Murdoch was looking to expand his satellite business the Wall Street Journal said that he was mulling over the possibility of buying General Motors, because its satellite division was worth more on the market than the company as a whole. -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail michael at ecst.csuchico.edu
Re: Query: Ford/General Motors
In a message dated 7/23/2004 4:04:00 PM Central Standard Time, [EMAIL PROTECTED] writes: CB: Well GM is only about the third largest company in the world now. I wonder if what's good for General Motors is still good for America. Way back in the thirties it was Alfred P. Sloan ( I think) who said GM is in the business of making money, not cars. Nice slogan for the merger of industrial and finance capital as Finance Capital. Comment Would one call General Motors and Ford Motors primary sources of profitability - outside of purely vehicle financing . . . mortgages for instance (DITECH) . . . a tendency towards the domination . . . if not outright domination . . . of speculative capital? This is meant in the sense that no one speaks of an industrial capital today that is dominated by banks . . . but rather something that is different. General Motors owned the Hughes communications outfit (counterpart and competitor of DIRECTV). All the large automakers have these massive high tech communications networks to tie their organizations together. For instance DaimlerChrysler has it own television network that runs continuous news in its plants as well as its financial arm . . . Chrysler Financial. These communications system are league beyond video conferences and match modern news agencies like CNN. About a year or so ago on Marxmail we had a discussion about "profitless prosperity." "Profitless prosperity"was the exact term used by the financial analyst of Ford Motor Company in a worldwide broadcast on the state of the auto industry and its market shares and projections for the future back in December 2002. It was in fact about a year ago that a discussion took place where Sartesian pointed out the 40% drop in labor input per vehicle since 1973 . . . yet the competition in auto is a dogfight . . . always requiring a massive outlay of capital to intensify the production process (organic composition), maintain the production and administrative infrastructure as well as other cost associated with labor. Profitless prosperity on the basis of vehicle production speaks of the incredible pull of value in the direction of zero and not away from zero. These companies possess incredible and magnificent industrial and communications infrastructures tied together an increasingly interactive world. Wait until the vehicles from China hit the market and go after first the Korea makers and then everyone else. The vehicles are already produced and waiting approval for market entry. For my money I cannot understand the economic incentive for the large automakers to NOT advocate for a nationwide health plan paid by the government. Chrysler has a 1 employed for two retired workers cost structure . . . and just cut some of our health benefits . . . for retired workers and GM slashed the medical benefits for its retired executive workers (nonunion) almost a decade ago and won it case in court about 3 . . . maybe four years ago. Jergen Schemp announced back in 2001 that perhaps upwards of 200,000 workers would be cut from the world automotive industry. Then again it was rumored that a section of the management of Chrysler Motors wanted to drop the car division altogether and concentrate on trucks. Strange. General Motors put on the back burner for a moment its new production facility design of modular produced vehicles . .. where the modules are shipped to a central point for assembly. By the early 1970 General Motors already had the blueprints for a 90 - 95% automated engine assembly plant . . . and I remember their statement that such a plant would destroy the labor market and their consumer base. Even without utilizing the advance technology available per unit labor input has still dropped at least 40% in 30 years. What next . . . trying to make money at big stakes crap tables? Melvin P.
Re: Query: Ford/General Motors
General Motors put on the back burner for a moment its new production facility design of modular produced vehicles . .. where the modules are shipped to a central point for assembly. By the early 1970 General Motors already had the blueprints for a 90 - 95% automated engine assembly plant . . . and I remember their statement that such a plant would destroy the labor market and their consumer base. Even without utilizing the advance technology available per unit labor input has still dropped at least 40% in 30 years. What next . . . trying to make money at big stakes crap tables? Melvin P. Comment A per unit drop of labor input of 40% in 30 years is running at an annual improvement factor of more than 10% and what is built into the union contract is an annual improvement factor of 3% increase in wages. The 3% annual improvement factor (AIF) was actually lost during years of concessionary contracts - 1980-1993, and "re-won" in the mid 1990s. If you were hired in the auto industry in 1972 and retired 2002 - after 30 years, what you experienced was a revolution in production that defines the meaning of downsizing. The increase in production was not accomplished just on the basis of speed up. Speed up is very different from a deep going intensification of the production process itself. There is another process of revolution in the material power of the productive forces taking place. The physicaltoilof a man's muscles can get easier as he is deployed to do the job of 25 people . . . due to advanced robotics and computers. Ford is slated to build its 3rd plant in China . . . in partnership with local manufacturers and these new plants are always built on the basis of a quantitative expansion of the intensive dynamic - quality, of the configuration of the production process. Unlike the Ford Motor Company's dealing with the Soviets in the 1920 and 1930 where they sold the USSR old tooling and antiquated production equipment . . . vehicles from China can only be profitable on the basis of not just cheap labor but revolutionizing the production process itself. Auto seems to be in the process of catching a cold . . . although the expansion of credit and debt has taught me a real lesson about consumption and production. I thought we would crash in 1996, 97 and 98 . . . only to see the expansion of credit and then in the wake of 9/11 . . . 2001/2202 cycle . . . zero interest rates. I did not predict zero interest rates and 60 month car notes. I actually come out of a historic 36-48 month credit and production cycle. What next . . . the ten year loan . . . with a guaranteed free upkeep - scheduled maintenance of ones vehicle? The Koreas makers are setting the pace on maintenance. And no . . . Marx did not predict this. Wasn't Marx dead when the gasoline automobile came on line? He did predict the process as the general law of capital accumulation in its absolute sense. Nevertheless when auto catches a cold the economy goes into withdrawal from consumption . . . and is driven to the emergency room for blood transfusion and pumped up with dope. Melvin P.
