Wednesday, December 30, 2009

What's an 'American-made' vehicle?

I just had to laugh when I read that Lucas County Commissioner and former UAW member Pete Gerken is in hot water over the lease of an Ohio-made Acura TL.

The car was a Christmas gift to his wife and, according to the report, was her choice. But that's just 'an excuse,' according to one UAW member, to get Gerken off the hot seat.

First of all, none of those union people who are so outraged can provide a definition of 'American made' when it comes to cars. I once had a conversation with a UAW leader that went something like this (note the ownership of the various brands was different back then):

ME: Would I be in trouble with the union if I bought a car made entirely at the Honda plant in Marysville? It's an Ohio-made car, so wouldn't that be good to support manufacturing in our state?

UAW leader: No - the plant is owned by Honda and the money goes back to them in Japan - it doesn't stay here in the states.

ME: Well, then. What if I bought a Volvo? They're made in the U.S. and Canada and the brand is owned by Ford - so the money would stay with an American company.

UAW leader: No - it's a foreign vehicle...Vovlo is German.

ME: But I can buy a Jeep made in Toledo by a German company who takes the money back to Germany - that's okay?

UAW leader: Yep - now you've got it.

This really happened! I was dumbfounded - there was no logic whatsoever to the thought process, except, perhaps, that some of the plants are union and some are not, but even that didn't explain the opposition to a Volvo made by UAW members.

The problem is with the thinking - or lack thereof. The UAW has never provided their definition of 'American made' - which makes it very easy for them to pick and choose what they want to support or criticize when it comes to car purchases.

Cars.com actually has an "American-Made Index":

"...rates vehicles built and bought in the U.S. Factors include sales, where the car's parts are made and whether the car is assembled in the U.S. Models that have been discontinued are disqualified, as are those with a domestic-parts content rating below 75 percent."

This seems like a fair way to judge whether or not a car is 'American.'

The #1 rank goes to Toyota Camry - what a surprise!

Only five of the top 10 vehicles are what most people would think of as 'American' because of the name of the company that makes them. According to Cars.com, that's a record low for the Detroit automakers.

Funny, but the Jeep products don't make the list.

In the news article, Bruce Baumhower, president of United Auto Workers Local 12, makes the point very well:

"My wife has always wanted a [Chrysler] PT Cruiser, which is made in Mexico, so there will never be a PT Cruiser in my family."

Rather than purchase a vehicle made by his employer (or the employer of his union members), Baumhower supported the purchase of Jeep products, even when the profits from the sale of those items was going to the German company, Daimler. But if you thought you were 'buying American' by purchasing the Chrysler PT Cruiser, you're wrong, even if it means you're sabotaging the sales of your employer.

How is anyone supposed to know what's 'acceptable' these days? In a global market where companies have plants all over the world, employ workers in markets where they hope to sell their cars, and where everyone is dependent upon trade with everyone else, how is a concerned buyer supposed to make a good decision?

Is it better to purchase a Japanese car made in Ohio by fellow Ohioans or to purchase a Detroit automaker vehicle made in Mexico by your employer? Which is 'better'????

Or is the decision supposed to hinge upon the unionization status of the workers? If so, then why would a unionized plan in Mexico making PT Cruisers be off limits?

What? You didn't know that Mexico had unions? Confederacion de Trabajadores Mexicanos, CTM, is Mexico's largest union and it represents the workers at the PT Cruiser facility in Toluca.

Maybe it's just UAW union plants that count.

This whole thing is just another way for unions to control their members and the politicians. Do you think Gerken will suffer any consequences for this purchase? The UAW did give him tens of thousands of dollars for his first campaign for commissioner. Will he get as much financial support for his next one? Or will the union decide that a Democrat is still better than any Republican opponent, even a Democrat with a Honda in the garage?

***SIDE NOTE:

I couldn't let this story go by with commenting on the decision to even publish a story about what kind of car some politician's wife drives. Does anyone else find it 'selective' that The Blade thinks this is worthy of a 742-word story but they didn't even mention the Commissioners vote to impose Project Labor Agreements for Lucas County bidders?

PLAs will increase the costs of government, force unionization on private employers and their workers and, interestingly, were opposed by The Blade the last time they were tried in Lucas County. Yet the paper never even mentioned the issue, despite covering the meetings at which they were discussed on voted upon.

Yet the paper thinks this is worthy of a front-page story on their second section.


END SIDE NOTE***

10 comments:

Mesmerix said...

I think the issue is that Honda is a non-unionized company that is solely owned by the Japanese.

The car, while completely American-made, does not support the UAW. Chrysler, on the other hand, is majority owned by the UAW. In fact, Germany doesn't have anything to do with them anymore after selling its stock. Italy (Fiat) owns around 20% of Chrysler, but the UAW still has over 60%. The US Government also owns around 10% and Canada has about 10% as well.

Another note, Honda provides more jobs than Chrysler, as the 4th largest manufacturer in the USA.

Some thoughts to ponder while considering what is and isn't American-made.

Roman said...

Once upon a time someone could tell what constituted a “American car”.

A few years ago, while working for a Toledo Chrysler dealer in the Service Department, the wife of a prominent local politician came in looking for a new car. The vehicle was picked out, price/finance was worked out, but before delivery, the deal was canceled.

When I next saw the lady, who I knew for years before, she was very apologetic for canceling the sale. She told me because the vehicle (Chrysler Concorde) was assembled in Canada, she could not buy it. She also told me that one of the Local Union Leaders had a list of “approved” vehicles to buy, and this model was not on it. She lamented to me that this Union Leader was not making the payment, so he should not be involved in the decision.

Maggie Thurber said...

Mesmerix - while I realize that Chrysler is no longer owned by a German company, it doesn't change the fact that while owned by a German company, UAW members were promoting those vehicles IN SPITE of the ownership issue...

That's the contradiction - and my issue with them in terms of their position on which vehicles are 'acceptable.'

The fact that Honda is the 4th largest manufacturer in the US is quite suprising!

Mesmerix said...

Maggie - I understand and agree with your stance. If they're going to demand "American-made" then they should certainly have a proper definition for the term. My personal opinion is that so long as the car is made here, providing jobs to tax paying Americans, then we shouldn't be complaining. If only every car manufacturer in the world would come here and set up plants to employ our people. Wouldn't that be nice?

Also, I wanted to clarify that Honda is the 4th largest CAR manufacturer in the USA. This ommission was unintentional, but I thought I'd mention it for posterity's sake.

Dan said...

I just love the mentality of both the Toledo Blade and the UAW. I would like to think that the Blade could print more important stories on the front page of the website.

In a prior career, I had to perform an audit for a few of the unions in town. As a proud owner of a Honda and a Toyota, I was banished to the back of the parking lot. I am sure the unions had made a few comments to my employer, as after that year I was no longer auditing unions.

As for the union ideas that all profits flow back to the foreign country, that is not always the case. Many business reinvest these profits into new facilities, production capabilities, etc. As well, they would employ local workers to build, upgrade, renovate, etc.

Since these companies also pay taxes (real estate, federal, state and local income taxes) as well as withhold payroll taxes on employees, I see no harm in supporting them, as they, in my opinion, build a much better vehicle.

Of course, with my attitude, I guess I will never get elected Mayor in Toledo...

James said...

That's the kind of thinking that has put Toledo and the rest of this country into such a mess. To me, just buy a car from a local dealer no matter what brand it is. It keeps people employed here in town. Then again, the more people are unemployed the more control the party in power (Democrat) has over those people to get their votes in the next election.

wolfman said...

Polly wants a Honda!
Gerken’s wife Polly a retired Toledo Public Schools psychologist should realize that as a union retiree her pension is the result of unionism. The argument of foreign or domestic is mute. The real argument is union VS nonunion. If not for the union contracts of TPS she would not be enjoying the retirement package she has. Now Polly leases a non union Honda that supports its workers with a 401K retirement and a lower wage. The UAW workers of Northwest Ohio support the TPS with living wage jobs that pay the taxes that afford Polly her wage & benefit scale. To undercut fellow union brothers and sisters that support her union is a slap in the face!

Maggie Thurber said...

wolfman - your perspective that Polly, as a former union member whose pension is through her union, should support union workers when making purchases makes sense.

However, that doesn't explain why this is a news article. Outside of government employment, census numbers tell us that only about 17% of the private sector is unionized. So how does the purchase of a non-union-made vehicle by a person who is not a 'public figure' constitute 'news'?

Also, please remember that non UAW workers of Northwest Ohio also support the TPS and pay the taxes that give Polly her pension. In fact, from those same census numbers, I know that the majority of those supporting TPS are NOT union workers.

That's just a clarification and doesn't negate your belief that it is proper for those who benefit from unions to support their fellow union members through purchases....

wolfman said...

Polly Taylor-Gerken, 48, a Democrat who ran for Toledo City Council several times. This summer her husband Pete was politicking on her behalf at the local 12 UAW hall. So I think this would constitute a "public figure". You're figure of 17% unionized is a apples to orange comparison. Unionized workers pay the bills in Toledo employ many in small business with their disposable income and add needed capital to local coffers. Finally I have nothing personal against Polly or Pete just am very disappointed in their lack of judgement.

Maggie Thurber said...

wolfman - she ran last year but is not running this year. I believe her status as a 'public figure' is questionable at best, considering that she lost and isn't running for anything now.

As for the 17% unionized, that means 83% of the 'bills paid in Toledo' are paid by non-union people who are contribution more than 3/4 of the capital and purchases other businesses need in the city.

I suppose, if I were a member of the UAW, I'd be mad about a fellow union member not supporting me.

But I still think this is an attempt at making Pete Gerken look bad because he's slapped Konop (a Blade favorite) down a few times. This really isn't news, though it is fun blog about...

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