UAW needs to understand corporations

By WARREN BROWN
WASHINGTON POST
WASHINGTON -- Corporations are not eleemosynary institutions. They do not exist for the public's welfare. They are not churches. They are driven more by greed than altruism.
That is not a criticism. It's a fact. It's neither good nor bad. It is what it is.
Grasping that fact is something the United Auto Workers (UAW) union has failed to do, and that's too bad. Had the UAW understood and accepted the intrinsic nature of corporations, it and its members would not be in the position they're in today -- lamenting the decision of German-owned DaimlerChrysler to cut 13,000 jobs and shutter all or part of four Chrysler Group plants in North America over the next three years.
It is a decision about money, and the Chrysler Group has been losing too much of it -- 1.5 billion in 2006 alone.
Lower pain threshhold
That's peanuts in comparison with the 12.7 billion lost by Ford in 2006 and the 10.6 billion lost by General Motors in 2005. But the Chrysler Group is no GM or Ford. By comparison, it's a corporate midget with a substantially lower tolerance for financial losses.
Moreover, it's not an independent corporation. It's an American division of a larger German company funded by German banks that, over the years, have become increasingly restive about Chrysler's poor financial performance. The banks have had enough, and they are putting pressure on DaimlerChrysler executives to do something about the corporation's wayward American acquisition, which has been a pain in the pocketbook since it was taken over by the Germans in 1998.
This is what the UAW does not appear to comprehend. Thus, in response to the latest bad Chrysler news, it sends forth its president and DaimlerChrysler Department director, respectively Ron Gettelfinger and General Holiefield, to decry the "devastating news for thousands of workers, their families and their communities."
The two continued in the joint statement: "While Chrysler Group's recent losses are not the fault of UAW members, they will suffer because of the reductions" announced by DaimlerChrysler's chief executive, Dieter Zetsche.
Fuel-efficient autos
Granted, it wasn't the UAW's idea to keep rolling out trucks -- and the wrong trucks at that, full-size pickups with underpowered V-6 engines -- when a lot of America was looking for fuel-efficient automobiles. It wasn't the UAW's idea to keep stockpiling those unwanted models until they had to be dumped on the marketplace at fire-sale prices.
But UAW members made those trucks, and they were paid handsomely for making them -- more handsomely than workers in Alabama are being paid for making hot-selling Hyundai Sonata cars, as handsomely as workers at Toyota's U.S. plants are being paid for making popular Camry cars and Tundra pickups, and as handsomely as employees of Honda in America are being paid for making fast-selling Civic and Accord automobiles.
A money problem
That's a problem. It's a money problem. When you're getting paid as much as someone who is making popular, profitable products, and you're making unpopular and unprofitable products, that's a really serious problem. Something's got to give, and more than likely it is going to be your job and your plant, and maybe your company.
It's business. And contrary to claims by Gettelfinger and Holiefield, it really has nothing to do with "our nation's ill-conceived trade policies."
Americans are buying Toyota cars made by Americans in America. Americans are buying Hyundai cars made by Americans in America. Americans are buying Honda cars, Nissan cars, Mercedes-Benz and BMW cars -- all made by Americans in America.
Chrysler's American losses are those Americans' gain. It has nothing to do with trade. It has everything to do with what is selling and what isn't, what is perceived as having value and what isn't. It also has much to do with the outstanding fact that Americans at those Toyota, Honda, Nissan, Hyundai, BMW and Mercedes-Benz plants, for whatever reason, have seen no value in joining the UAW.
Again, it's business. It comes down to money. Consumers don't drive flags. They drive cars. If they believe a car has good value for dollar, then that is the car they buy. If they don't see that value, they don't buy. Their purchase decisions aren't based on what is good for the community, or the country, or the UAW. In that regard, they are much like corporations. They are in it for the money.