Pricing is out of control

[JerryETX]

I just was reading what the UAW is going to start with when contact talks begin here shortly. They are asking for a lot, a 46% pay increase, and a 32-hour work week, the most notable wants so far. I understand the concept of asking for the moon and then negotiating down but if they get this or any substantial compensation, the price of a new vehicle, coupled with high interest rates, is likely to increase well out of the reach of the middle class.

Asking for more to negotiate down is understandable but this is being unrealistic in my opinion. This is greed by definition.

 

[Tulecreeper]

So how do we know the current prices are not cost + 10%? Also whose cost? FCA, dealer or ??? Unless someone is willing to spill the beans on whoever's cost we are talking about then it would seem we have no way of knowing.

Chri5K just asked what it should cost, and that was my opinion. I have no idea how they would arrive at that number.

 

[Tulecreeper]

10% would drive them bankrupt. Marketing, R&D, compliance costs, recurring and non-recurring maintenance costs, legal fees, debt servicing, etc. would burn through 10%.

https://www.stellantis.com/content/...Stellantis-NV-20230630-Semi-Annual-Report.pdf if you'd like some idea of what their actual financials look like.

My meaning was, 10% profit on each vehicle after all of that is taken into account. Somebody has those numbers, and an average can be taken from that.

 

[jejb]

No discounts, rebates, or any other incentives when I bought mine in January.

There would have been if you'd ordered it through Granger or Mark Dodge. You'd have been about %14 under MSRP, most likely.

 

[Docwagon1776]

My meaning was, 10% profit on each vehicle after all of that is taken into account. Somebody has those numbers, and an average can be taken from that.

Sure. Stellantis has it. You can have it in aggregate be simply clicking the link I gave you and reading the financials. Did you do that? Did you see how close to 10% profit from revenue they are at?

Do you suppose that, perhaps, supply & demand should continue to set price? Why must every vehicle have the same profit margin, which you've deemed "fair"? Should the limited edition Chargers have the same profit margin as a Jeep Compass?

 

[Docwagon1776]

Asking for more to negotiate down is understandable but this is being unrealistic in my opinion. This is greed by definition.

Funny thing: It's to phased in over 4 years and is based on the raises C-level executives got over the past 4 years. Workers wages and retiree pensions lost ground vs inflation.

You either want a middle class or you don't. If you're happy with more and more wealth (and, the attendant power in society) in the hands of fewer and fewer, then it's very greedy. If you'd expect the workers' purchasing power to not continue to shrink, then it's not greedy in the slightest.

 

[JerryETX]

Funny thing: It's to phased in over 4 years and is based on the raises C-level executives got over the past 4 years. Workers wages and retiree pensions lost ground vs inflation.

You either want a middle class or you don't. If you're happy with more and more wealth (and, the attendant power in society) in the hands of fewer and fewer, then it's very greedy. If you'd expect the workers' purchasing power to not continue to shrink, then it's not greedy in the slightest.

The average annual pay increase in 2023 was just UNDER 4%. Asking for 46% increase in pay combined with a 20% reduction in weekly hours is flat greedy in my opinion even if it is over a 4 year period.

 

[Docwagon1776]

The average annual pay increase in 2023 was just UNDER 4%. Asking for 46% increase in pay combined with a 20% reduction in weekly hours is flat greedy in my opinion even if it is over a 4 year period.

They are still hourly, so a reduction in hours is a reduction in pay. Personally, I think it's a ploy to reduce part time employees if you have to give full benefits to anyone working 32 hours or more. Why is it greedy for workers to ask for the same percentage of pay over the next 4 years that senior execs got over the last 4? At a time of record profit, and when concessions were made during a downturn that weren't recovered?

We're going for 30% over 4 years on our next contract. One of our main competitors for people in the applicant pool just gave a 17% bump earlier this year. We are understaffed by almost 25% and can't recruit, train, and replace fast enough to keep up with retirements, as we're an older work force comparatively. Our overtime budget is insane, and people are getting so burnt out it's getting tough to fill the hours. Maybe you think it's "greedy", but it's supply and demand. There's a shrinking supply of willing and able workers, more so in some sectors than others...

 

[BossHogg]

Asking for more to negotiate down is understandable but this is being unrealistic in my opinion. This is greed by definition.

Yeah, sure is. What I'm reading in the Detroit news is the UAW is justifying the 40% based on what automotive executives' increase equated to last year.

I'm wondering what the increase will do to the MSRP of a new vehicle. If they get what they want, the first-year pay increase would be 25%. At one time, the labor costs in a vehicle were 17% but they may be lower these days with the amount of automation introduced in the assembly of vehicles. So that could equate to a $2,200 increase to the MSRP.

My wife is looking for a new vehicle, I told her she better get busy before the contract talks start.

 

[jejb]

Why is it greedy for workers to ask for the same percentage of pay over the next 4 years that senior execs got over the last 4?

Because those execs are likely putting in 70-80+ hour weeks, week in, week out. They tend to travel a lot for the company too. Sounds like fun at first, but gets old in a hurry. I did the road warrior thing for a while. Not much of a family life doing that.

I work at one of the worlds largest tech companies, and have for a lot of years. I had friends that went the exec route. Great money, but you have to give up your life to it in large measure. I was offered that path, but decided family and fun were too important to me.

 

[shrubs]

I learned spending from "the greatest generation"

-you either want or need an item, if you think it's too expensive, don't buy.

 

[JerryETX]

Why is it greedy for workers to ask for the same percentage of pay over the next 4 years that senior execs got over the last 4?

Two wrongs don’t make a right.

When you made the deal to start working for your company, business, employer, etc both of you agreed on terms of pay, benefits, etc. Why does it matter what someone else makes thats in a much position than you may be in? It shouldn’t at least that’s how I was raised.

 

[Docwagon1776]

Because those execs are likely putting in 70-80+ hour weeks, week in, week out. They tend to travel a lot for the company too. Sounds like fun at first, but gets old in a hurry. I did the road warrior thing for a while. Not much of a family life doing that.

Ah, well totally worth $14-$17 million then. Poor babies, and I'm sure they are totally unique in that way.

Two wrongs don’t make a right.

When you made the deal to start working for your company, business, employer, etc both of you agreed on terms of pay, benefits, etc. Why does it matter what someone else makes thats in a much position than you may be in? It shouldn’t at least that’s how I was raised.

Neither is wrong. It's quite literally the foundation of capitalism. The 'wrong' is that for capitalism to continue to function there needs to be some relative equality at the bargaining table. If one side has all the clout, that's no longer capitalism and is serfdom. Let's take one small aspect of the result of the growing wage gap. Do you see what housing prices are doing? Do you know how many residential properties are now being bought by investment firms and then rented vs how many remain in individual hands? Do you think it's a good idea for your employer to also control your housing and your retail outlets? You know, company housing and a company store? Can you look at literally any point in human history and see where a sizable middle class existed when wealth and power was concentrated in fewer and fewer hands? We aren't allowed to discuss politics, so let's discuss the simple economics of it. Why are monopolies illegal? What is the lesson there for issues that are created when an extreme power balance occurs in economic negotiations?

It matters for that reason, regardless of how you were raised if you would like to keep a robust middle class. Some people were raised to be good slaves as well. Poor people don't stay poor because of lack of money, they stay poor because of lack of education and the ability to put that education to work.

 

[Tulecreeper]

Sure. Stellantis has it. You can have it in aggregate be simply clicking the link I gave you and reading the financials. Did you do that? Did you see how close to 10% profit from revenue they are at?

Do you suppose that, perhaps, supply & demand should continue to set price? Why must every vehicle have the same profit margin, which you've deemed "fair"? Should the limited edition Chargers have the same profit margin as a Jeep Compass?

Hey, I was just answering a question with an opinion. I'm not the least bit interested in, nor do I care, what is fair.

 

[Tulecreeper]

There would have been if you'd ordered it through Granger or Mark Dodge. You'd have been about %14 under MSRP, most likely.

But I didn't, hence my comment.

 

[jejb]

Ah, well totally worth $14-$17 million then. Poor babies, and I'm sure they are totally unique in that way.

They are certainly unique from manufacturing employees. You punch in, do your hours and go home. An exec is more or less always on the clock. I'm not justifying what top exec's make. But saying line dogs should get equal percentage of raises isn't right either, IMO.

 

[JerryETX]

Ah, well totally worth $14-$17 million then. Poor babies, and I'm sure they are totally unique in that way.



Neither is wrong. It's quite literally the foundation of capitalism. The 'wrong' is that for capitalism to continue to function there needs to be some relative equality at the bargaining table. If one side has all the clout, that's no longer capitalism and is serfdom. Let's take one small aspect of the result of the growing wage gap. Do you see what housing prices are doing? Do you know how many residential properties are now being bought by investment firms and then rented vs how many remain in individual hands? Do you think it's a good idea for your employer to also control your housing and your retail outlets? You know, company housing and a company store? Can you look at literally any point in human history and see where a sizable middle class existed when wealth and power was concentrated in fewer and fewer hands? We aren't allowed to discuss politics, so let's discuss the simple economics of it. Why are monopolies illegal? What is the lesson there for issues that are created when an extreme power balance occurs in economic negotiations?

It matters for that reason, regardless of how you were raised if you would like to keep a robust middle class. Some people were raised to be good slaves as well. Poor people don't stay poor because of lack of money, they stay poor because of lack of education and the ability to put that education to work.

Your wayy off track. The wrong is for one to think they are owed the same or similar pay increase rate as another person who does an entirely different job that likely requires more skill, hours, and/or more education and likely comes with more stress.

What your preaching is self entitlement and there’s too much of it in this country.

You made a deal with your employer when you signed on. Keep your end of the bargain. If you don’t like it hit the road. Nothing is more infuriating than employees trying to tell a business executive or owner/owner’s group how much that employee thinks they should be paid.

 

[Docwagon1776]

Your wayy off track. The wrong is for one to think they are owed the same or similar pay increase rate as another person who does an entirely different job that likely requires more skill, hours, and/or more education and likely comes with more stress.

What your preaching is self entitlement and there’s too much of it in this country.

You made a deal with your employer when you signed on. Keep your end of the bargain. If you don’t like it hit the road. Nothing is more infuriating than employees trying to tell a business executive or owner/owner’s group how much that employee thinks they should be paid.

So you never ask for a raise or a change in benefits? Your first agreement is it? That's a choice, I suppose.

 

[Docwagon1776]

They are certainly unique from manufacturing employees. You punch in, do your hours and go home. An exec is more or less always on the clock. I'm not justifying what top exec's make. But saying line dogs should get equal percentage of raises isn't right either, IMO.

Why? Not equity of pay, but maintaining their share of the pie they had?

 

[jejb]

Why? Not equity of pay, but maintaining their share of the pie they had?

Why? Because greed doesn't look good on anyone.

I started out in manufacturing. Was a decent job. Non-union, good pay and good benefits. Still, I wanted better. So I put myself though college, working full time with a family. When I got through, I expected to make more money than my buddies back on the line, and I did. Pretty much doubled my income within a couple of years. But not by beating my employer up, by making myself more valuable.