Could the UAW buy GM?
Felix Salmon at Seeking Alpha says the short answer is, yes, but it probably won't.With the newly draw up contract between the UAW and GM, the automaker will transfer almost $30 billion into a what is basically a health care fund, with another $5 billion to $7 billion added down the road. As Salmon says, that's more than enough to just buy the General outright, essentially turning it into an employee-owned company.
[Source: Seeking Alpha]
It's not a completely original idea, as Salmon points out. The Wall Street Journal brought up the idea back in 2006, but suggested the Union own only a piece of the biggest U.S. car builder. The WSJ said the prospects of part ownership by the UAW would be enormously complicated with tax, legal and managerial problems.
But Salmon thinks full UAW ownership would simplify much of that and end up benefiting both the company and the workers. After all, if workers directly benefit from their performance then surely the quality of their work would improve, and the chance of a union-led strike would be almost nil.
Salmon, though, says the UAW instead should take its newfound cash and invest it wisely, U.S. automotive companies not being one of the better choices.
Though not likely to happen, UAW ownership of GM is one of those intriguing what-ifs that can keep us automotive fans talking for days. So, what do you think? Should the UAW write a check for GM?
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Reader Comments (Page 1 of 2)
Sodamninsane 7:16PM (10/01/2007)
wow talk about the death of a company. That would be a sure fire way for GM to go straight down the tubes. Yes it's possible, but that would leave the UAW with a massive amount of debt (GM still has unfunded liabilities, and to put on top of that no healthcare fund for retirees and workers) that it would somehow have to recoup to pay for immediate and future healthcare costs. The general obviously is in no way capable of providing those kinds of funds for the short term, and who knows in the long term.
On the other hand, I'd almost like to see what the UAW's management style would do to a company, I'm pretty sure we know the answer, as we've seen what they can do to companies they don't own.
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Zerk 7:16PM (10/01/2007)
If UAW owned GM,
1. Could they afford to fund their own health plan?
2. Who would they fight with at contract time?
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Mike 7:21PM (10/01/2007)
This would be like Michael J Fox meeting himself in the past, the entire company would implode.
You'd find engineers taking 2 hour sleep breaks and line workers working free overtime.
cowboy bob 2:14PM (10/02/2007)
Interesting theory Mike. It would seem that the whole space/time morass would simply dissolve into morphed symbionic replication of of Bizzaroworld. It would be quite something to see the UAW choke up a honker for a change. The real question however, is what car model would be converted to use the flux capaciter?
J M C 3 7:24PM (10/01/2007)
bloodsuckers need hosts
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Vivek 7:44PM (10/01/2007)
The inmates running the asylum? No thanks. I like GM and i hope they stick around. That sure won't happen if the UAW is in charge.
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naif 7:52PM (10/01/2007)
IT WILL NOT WORK!
without pointing fingers, it did'nt work at the non-existent Saturn plant.
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Stéphane Dumas 7:58PM (10/01/2007)
the UAW buying GM, I wonder if it could be a move to resell GM to another carmaker? Between that and Kerkorian's idea of merging GM with Renault-Nissan last year http://www.autoblog.com/2006/06/30/kerkorian-merge-gm-with-nissan-renault/ I wonder which one is the less evil? (and there this article from mid-September mentionning Ghosn still see some tie-ups with GM in a more long-term http://money.cnn.com/news/newsfeeds/articles/newstex/AFX-0013-19607286.htm )
Btw, does Harley-Davidson is still runned and directed by his employees?
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geo.stewart 8:23PM (10/01/2007)
employee-owned. then they might have to hold themselves accountable.
the horror! the horror! the horror!
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SPG 8:45PM (10/01/2007)
*Engine starts slapping*
- (Patty the line worker/owner) -
"God damn I screwed this one up!"
A5-14 8:43PM (10/01/2007)
That will be prevented by contract. Who needs another United Airlines?
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SPG 8:44PM (10/01/2007)
With GM's current turn-around of quality desirable vehicles it would be a shame to let a Union run a car company into the ground.
That's if they screwed up.
Otherwise this would be a very intresting experiment.
One that I'm sure we'd all follow with the greatest interest.
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whofan 8:50PM (10/01/2007)
It would help Ford and Chrysler out. The UAW will finally realise the amount of money a company needs to remain competitive.
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Alex 9:19PM (10/01/2007)
damn... the cyclical problem they would run into would be enough to make your head explode.
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Buckus 9:21PM (10/01/2007)
That would put the UAW in the awkward position of lowering wages, moving factories to other countries, and cancelling retiree health care. Maybe then they would see why GM needs these kinds of things to stay competitive.
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Whitie 9:37PM (10/01/2007)
I've been wondering exactly the same thing since the VEBA was announced.. the UAW will soon have enough money to buy GM.
Maybe it's not too far fetched. The whole VEBA / job guarantees debacle prooves the UAW has smarter leadership. Plus the UAW could dump all the GM salaried workers and replace them with laid off, lazy arse screw shooters.
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V.S. 5:27PM (10/14/2007)
Whitie, you are lost in an Ozone.......go take a deep breath and then blow it out your ass. You have no idea what goes on in an auto manufacturing plant....Toyota/Honda have the same wage as GM/Ford...difference.....they have only 300 people that are retired and they make their parts for their product in a country that has "national health care"......hence....the car is made cheaper and they can slap on a few more options and still have an advantage.....Have you caught on yet little man???????? Anyhow....S.O.R. ......suck ole' rusty!
Victor 9:47PM (10/01/2007)
ha-ha-ha, this just hilarious - a bunch of drunk stupid lazybones along with smart ass union leaders owning the company they have been milking and ruining for years. ha-ha-ha!!! that would be a movie to watch!
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Richard Warren 5:13AM (10/02/2007)
Think Harley.
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Jay Evans 10:54AM (10/02/2007)
Harley was bought by a group of previous management, not the IAMAW Union. They just had a strike at Harley last Feb.