The pre-compilation newspaper reported last week that Delphi, the largest US parts supplier, had announced its acceptance of bankruptcy protection. Many readers expressed concern. To this end, we organized the following group of follow-up reports. In addition to tracking the latest news, we also analyzed the background and impact of the Delphi incident. How Delphi will change American cars Why did Delphi get stuck? Delphi stalemate mirrors the impasse in the United States AGV High Speed Door, AGV Car High Speed Door, AGV Trolley High Speed Door SHENZHEN HONGFA AUTOMATIC DOOR CO., LTD , https://www.hongfahss.com
After Delphi announced acceptance of bankruptcy protection, Delphi CEO Steve Miller likened the current situation: Delphi, GM, and UAW (American Automobile Workers Federation) seem to be three western cowboys, one holding a gun, aiming at each other . If GM or UAW shoots, Delphi may be out, but there is more than Delphi out of the game, so no one can easily open fire.
Miller believes that Delphi will be the "breaker" who discourages the other two cowboys from laying down their guns. It will also be the "breaker" who has changed the long-term conflict in the US auto industry.
On October 8th, Delphi filed for bankruptcy protection. The ruling of the bankruptcy court has not yet announced that more than 500 suppliers in Delphi's upper reaches are nervous. Their previous contracts with Delphi are likely to be suspended due to bankruptcy protection. They are also likely to accept new, lower-priced contracts approved by the bankruptcy court and face greater cost pressures. Even more frightening is that after the Delphi incident, many large US parts companies like Delphi are likely to choose cheap upstream components from overseas.
Delphi's announcement of bankruptcy protection is far more than that.
U.S. industry analysts believe that if Delphi gets bankruptcy protection and obtains UAW permission to reduce worker welfare, then other parts companies and even vehicle companies in the United States that have the same problems may do the same.
Some outsiders here have analyzed that the “Delphi incident†is likely to become a watershed in the history of UAW, and the power of UAW will not be as powerful as ever.
James McTevy, who participated in Delphi's reorganization, said: "If Delphi reorganizes successfully, it is likely to create a new way to reduce scale and capacity for the entire US automotive industry."
Delphi’s separation from General Motors in 1999 not only accepted GM’s many technical properties, but also inherited the GM’s collective bargaining agreement. Under the agreement, Delphi must provide the same wages and benefits to unionized employees as general employees. The agreement also stipulates that Delphi can "return" the excess labor released with the increase in production efficiency to GM if GM employees retire with sufficient vacancies.
However, the current US auto market has been very different from the previous year when it signed the agreement. Due to the impact of global production and rising medical costs, employee benefits in the agreement became a heavy burden on Delphi, and GM’s originally promised “innovation†plan also fell short of GM’s sales decline in the North American market. Today's GM companies also have a large number of employees waiting to be laid off. Delphi had to pay workers' wages in accordance with the original agreement, and also paid more than 4,000 waiters to pay 100 million U.S. dollars in wages and benefits every quarter.
Delphi was overwhelmed and repeatedly discussed with General Motors and UAW about changing the wage and welfare agreement of workers. He eventually chose bankruptcy protection.
Many people in the industry stated that they had to admire Delphi CEO Miller's courage. He chose bankruptcy protection under huge capital pressure, which put Delphi in the limelight. Miller said in a recent speech: “I just hope that everyone can see that everything that happened in Delphi is actually a microcosm of the collision between economic and social trends in our country and even in the world.â€
Behind the predicament of Delphi is the complex contradiction between the aging of the population, the globalization of manufacturing, and the fixed welfare retirement plan of the United States. This contradiction has become increasingly prominent in the US automobile industry.
"Now, auto workers enjoy the fruits of labor more than the time they participate in labor." Miller complained.
This is also true of the fact that the population is aging. In the past, American auto workers were working in their 20s, retired at 65, and died at the age of 70—45 years of work and 5 years of retirement after retirement; while workers now work at 20, retired at 50, died at 90—for 30 years. Enjoy 40 years of retirement benefits. The life span of people has changed, and the retirement plan for fixed benefits has not changed.
At the same time, global production has also caused cost pressures in the US automotive industry. There is a huge difference in labor costs between the United States and many developing countries, which leads to differences in car costs and prices.
As a society, someone must pay for such welfare and labor costs. What is surprising to the American auto industry is that at the time of buying a car, if Americans have other choices (such as Japanese cars), they are unwilling to pay for each US car that contains US$1,500 in welfare dollars.
As Miller said: "The problems of the US social security system and the medical system involve various political forces, and any reform measures will be difficult to implement in the next few years. But we are witnessing the slow and painful of these outdated systems. take a bow."
China Automotive News, October 11, 2005, version A11
Delphi: Outgoers are still the losers