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Update with Holden @ Elizabeth - closing down more likely??

Torborg

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I'm inclined to support your scepticism. The median factory worker is on about 40k, I doubt you get 2.5 times more to assemble vehicles.
Agreed. There's no way that holden production workers are earning $50/hr.
 

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Seems that the seemingly reliable source was off the mark...average Elizabeth worker gets $45-70k according to a news.com.au article, average of $66k according to the Australian. Total manufacturing average is apparently $54k, with auto industry as a whole at $68k. The pay cut is $200/week (not sure if this is average or pro-rata). This changes my perception a bit. Not has highly paid as I thought. Whilst someone on $100k/yr might absorb a $200/week pay cut reasonably well if push came to shove, no way would someone on about $60k.

Am now in 2 minds about this...
 

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Seems that the seemingly reliable source was off the mark...average Elizabeth worker gets $45-70k according to a news.com.au article, average of $66k according to the Australian. Total manufacturing average is apparently $54k, with auto industry as a whole at $68k. The pay cut is $200/week (not sure if this is average or pro-rata). This changes my perception a bit. Not has highly paid as I thought. Whilst someone on $100k/yr might absorb a $200/week pay cut reasonably well if push came to shove, no way would someone on about $60k.

Am now in 2 minds about this...

You can't have the "average" Elizabeth worker getting a range like $45-70k. An average would be the average of that, or something. An average is a definitive number.
 

c2105026

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You can't have the "average" Elizabeth worker getting a range like $45-70k. An average would be the average of that, or something. An average is a definitive number.

Wording from actual News Ltd article would you believe

On one hand you could say unions got a bit carried away; OTOH you could argue-why should the assembly plant workers have to pay for management's screw up of investing in the wrong product lines?
 

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$50/hr is just ridiculous, I've got a mate who works on the production line at toyota here in Melbourne. He's been there a few years now and was saying he thought he was doing pretty well for "just a factory worker" at $35/hr. $50 is just over the top and stupid from both Holden and the workers perspective.

Just to clear up a misconception here. $50ph includes all on costs. That is the provision for annual leave, sick leave, superannuation, long service leave etc. Bring it back to what most people think of as the nominal hourly rate and it's still good money but not quite as attractive as it may appear.

Seems that the seemingly reliable source was off the mark...average Elizabeth worker gets $45-70k according to a news.com.au article, average of $66k according to the Australian. Total manufacturing average is apparently $54k, with auto industry as a whole at $68k. The pay cut is $200/week (not sure if this is average or pro-rata). This changes my perception a bit. Not has highly paid as I thought. Whilst someone on $100k/yr might absorb a $200/week pay cut reasonably well if push came to shove, no way would someone on about $60k.

Am now in 2 minds about this...

That sounds about right. Once you add on the on-costs it's roughly $50 an hour.
 

c2105026

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Sounds like GM doing the same as they did in the US during the GFC when they wanted Gov money. How much do autoworkers really earn? - National progressive politics | Examiner.com

Good point and link. An issue with GM US is that they are now effectively a health fund with zero premiums and a pension fund with not a lot of contributions - and sometimes they build and engineer cars. US Govt policy of lower welfare and no free health care until a couple of years ago is why some older US companies are struggling. See, if someone retired in 1980 at say age 60, GM pension fund would have assumed they would have died around year 2000, based on life expectancy data at the time. But, as we know, we have an aging population, and welfare/healthcare costs are on the rise, people are living longer. If this worker is still alive (age 93, is entirely possible) that's well over $300,000 in benefits paid that GM would not have banked on in the 1980s. And that is all taken into account to get '$73 an hour' that the article above suggests. Not sure what the worker benefit setup is for Holden workers, but at least Holden doesn't have to pay for retired worker healthcare....

But is the current issue with Holden high wages? I am now thinking it is. Yes Holden makes $2500 loss on every car it built here. But in the 90s they were making a profit. Why? They made more cars they could sell. Wages are only but one variable. You have plant running costs, rates, bills, and all the non-assembly workers. Development costs. There would be substantial overheads regardless; and there would be a production/sales volume where there is a break-even point. Backing the wrong horse has resulted in the cars Holden builds to not sell. It could have quite easily selected more popular lines. With the gift of hindsight the RWD commodore could have been stopped after the VZ, with more focus given to a small SUV, small car, or people mover (but, true, the VE was signed off on when Commodore was selling very well. Very few predicted the 00s energy crisis, and the GFC).
 

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Good point and link. An issue with GM US is that they are now effectively a health fund with zero premiums and a pension fund with not a lot of contributions - and sometimes they build and engineer cars. US Govt policy of lower welfare and no free health care until a couple of years ago is why some older US companies are struggling. See, if someone retired in 1980 at say age 60, GM pension fund would have assumed they would have died around year 2000, based on life expectancy data at the time. But, as we know, we have an aging population, and welfare/healthcare costs are on the rise, people are living longer. If this worker is still alive (age 93, is entirely possible) that's well over $300,000 in benefits paid that GM would not have banked on in the 1980s. And that is all taken into account to get '$73 an hour' that the article above suggests. Not sure what the worker benefit setup is for Holden workers, but at least Holden doesn't have to pay for retired worker healthcare....

That article is very old and relates to "old" gm, Chyrsler and Ford. Of those two have been thru bankruptcy and no longer have that problem. All of those crazy expensive legacy costs stay with the original GM & Chrysler which are now essentially worthless companies saddled with tens of billions of dollars of debt but zero income. The thrust of it however is along the lines of what I posted above.

But is the current issue with Holden high wages? I am now thinking it is. Yes Holden makes $2500 loss on every car it built here. But in the 90s they were making a profit. Why? They made more cars they could sell. Wages are only but one variable. You have plant running costs, rates, bills, and all the non-assembly workers. Development costs. There would be substantial overheads regardless; and there would be a production/sales volume where there is a break-even point. Backing the wrong horse has resulted in the cars Holden builds to not sell. It could have quite easily selected more popular lines. With the gift of hindsight the RWD commodore could have been stopped after the VZ, with more focus given to a small SUV, small car, or people mover (but, true, the VE was signed off on when Commodore was selling very well. Very few predicted the 00s energy crisis, and the GFC).

It's real easy to say it's backed the wrong horse but which one would you put your money on? Holden were building the most popular car in the country up to the year before last. It also added the Cruze which is slap bang in the middle of what is now the most popular segment being the small car. Have a look at the VFACTS car stats for any number of months. The Australian market is stupidly fragmented with no single car a stand out success, nor selling in volumes month in month out that could sustain local only production.
 

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