Did you recently take on (or consider) a loan of 84 months or longer on a car purchase?
A reporter would like to speak with you about your experience; please reach out to PR@Edmunds.com by 7/22 for details.
A reporter would like to speak with you about your experience; please reach out to PR@Edmunds.com by 7/22 for details.
Options
Does America Even Need Its Own Automakers?
This discussion has been closed.
Comments
Actually, I figure the 2010 Fusion in general will be among the top 3 midsize cars in America from the looks of things. I'd be VERY surprised if it finishes outside of the top 3 in any road test (among that top 3 the decision largely comes down to individual tastes of the testers).
...And the 1930s and 1954-1955 Century, plus the 1963 Riviera, all nice looking, desirable, high performance cars in their day. Why Buick didn't do sequels on these performance models is beyond me. If they had Buick's demographics would be stronger today. Well, they half-tried with the 1980s T-Types, but, then, instead of taking those to the next level, they dropped them. Why, I'll never know. Maybe Buick gave up on this market because Pontiac was GM's designated performance division, and Buick stood for affordable luxury, size and substance.
I agree with you. Although it's a little more money, how do you like the tC?
Honda doesn't have the luxury or the finances for building a whole new vehicle so they chose to cover the entire range with just one model. It also reflects in the pricing strategy too, as a base model Accord goes for around the same money as a base Camry, but loaded up can cost as much as a mid level Passat, Avalon or Maxima.
Enthusiasts got the short end of the stick with the last two generations of Accord. Which is probably why the TSX was so wildly popular. It retained the essence of the "enthusiasts" Accord while the real one went off to fight the bread and butter markets.
The government didn't force the car makers to offer health care insurance. They choose to do so on their own, as it was often cheaper in the 1960s and 1970s to offer better health care benefits than higher wages.
At that time, health care was pretty simple and straightforward. If you had a heart attack, for example, it was often fatal - end of health care expenses. Cancer was treated by either amputating the affected part or giving a person massive doses of radiation - and lots of people still died, which, again, meant the end of health care expenses. Replacements for hips, knees, etc., and the resulting physical therapy, were unknown. No one knew what an MRI was.
Now we can help people survive these conditions. But this costs money - lots of money.
The biggest health care expense for the auto makers is providing health care for retirees. There already exists a government program for senior citizens - Medicare. The UAW won't accept the coverage provided by Medicare. The union won't give up company-provided health care coverage for retirees. Any nationalized health care plan will look more like Medicare in the coverage provided than the current plan enjoyed by UAW members. So the UAW's call for nationalized health care is more than a little disingenuous.
People also need to pay attention to what is happening in countries with nationalized health care. Virtually everyone who can afford to do so supplements their goverment-provided coverage with private insurance. Cuts are being made in the benefits provided by the government plan (we've especially noticed this with my German relatives - the government has been reducing benefits and instituting higher co-payments for well over a decade).
The bottom line is that there is no free lunch. People seem to think that a nationalized plan will provide them with UAW-style benefits at no additional cost, or at least without any higher taxes. Sorry, but that isn't going to happen...
Yes, it is. I heard that Honda going to bring V6 TSX, it's gonna be a killer
A killer of what? The 4-banger TSX and FWD TL?
The problem is that private health care is totally for-profit--it's a business, like office equipment or auto repair. Back when, the auto companies attracted workers with a health/pension plan that simply did not exist anywhere else. The U.S. government offered nothing for those under 65 who were gainfully employed. You bought your own.
But now, with all the rampant inefficiency of the American private health care system, and runaway costs, instead of it costing a couple hundred dollars per car to underwrite a worker, like it does at Toyota, it costs perhaps $1K-$2K to do it for the Big Three.
so what seemed like a good perk in the 1960s turned out to be an enormous burden in 2009.
If the US government doesn't help with this, I just can't see how the Big Three won't sink like a stone under the healthcare/pension weight.
It's not the NUMBER of union members (Toyota has more union members), it's that per capita cost.
Even when I started with Pacific Telephone in 1961 we paid a portion of our health care. I posted one of my pay stubs. In 1965 I made $199 every two weeks and paid $14.83 into my health care plan. Or about 7.45% of my gross pay. We that have full free coverage have gotten spoiled and many feel they are entitled to that benefit. I am thankful for the years I did have coverage. Now I pay out of my SS check $129 per month to Medicare. No Free Lunch. It has to come from somewhere.
Painfully, unfortunately.
How so?
Was it not US companies' competition for workers in the 2-3 decades after WWII that added in the benefits such as more vacation time, sick days, medical coverage? How many workers in the 30s' had health/medical coverage?
Anything that consumers have to pay out of own pockets is usually well scrutinized for value.
There isn't really a European plan - each nation is still responsible for its health care plan. None of the plans used by European countries are as generous in the benefits provided as the UAW plan. You - and many other posters on this board - may like one of the European countries' plan, but the UAW workers probably wouldn't. The simple truth is that European plans resemble Medicare more than they resemble the UAW plans.
Mr. Shiftright: The problem is that private health care is totally for-profit--it's a business, like office equipment or auto repair.
The problem is that the consumer - the insured - is completely disconnected from the costs, because the employer picks up the tab for insurance premiums.
Plus, many states have mandated that all policies offer certain benefits, which adds to the cost for ALL policies.
In Pennsylvania, for example, last year the state mandated that all insurance policies must provide coverage to treat autistic children. Great - if you have an autistic child. Only problem is that this increases the cost of insurance for EVERYONE, including the single 20-something who is now paying for a basic policy that provides coverage they do not need and will not use.
Mr. Shiftright: But now, with all the rampant inefficiency of the American private health care system, and runaway costs, instead of it costing a couple hundred dollars per car to underwrite a worker, like it does at Toyota, it costs perhaps $1K-$2K to do it for the Big Three.
That has less to do with rampant inefficiency as opposed to, 1. more generous coverage provided by the domestics, and 2. coverage for retirees, which Toyota does not provide for its North American blue-collar workers.
But regardless, let's say you are completely right, and that the UAW plan is too generous.
That's a decision the automakers and unions made way back when and now they are living with the consequences. But hindsight is always 20-20. They didn't know what they know now, and in terms of health care, they had to offer it. Automakers were high on the hog in the 1960s.
And you had to offer good benefits to get good workers to do that kind of work. The exploitation of labor was not going to happen in the 60s like it did in the 30s.
Are you willing to take European levels of taxation as part of the bargain? Looks to me like about a 30% to 50% increase in taxes would catch us up to Germany, UK, or France.
Total tax ratio as percentage of GDP, 2006
What's galling is paying taxes and getting nothing, or next to nothing. In that instance, I can well understand the concept of tax revolt.
I've spent a lot of time in Europe. Those people live pretty damn well--at least western Europeans. And 4 out of the 5 nations judged "most competitive" right now are combo -- democratic/socialist systems.
It would be great if Americans could do a line by line delete of where their taxes go. That would be utopia for me. We'd be able to punish inefficient systems.
I have my targets :P
I'd like to find the brilliant economist who decided that you could cut taxes and increase deficit spending at the same time.
Or, more on topic, for automakers, that you could increase labor costs while losing market share.
Even a corner grocery store owner in Istanbul knows better than that.
Just a for instance, my BIL is from Ireland and has talked about the flat tax they have there. It seems easier to me, IMHO, rather than hiding tax at every turn like we do here in the US.
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
The French plan isn't a pure nationalized health care plan. Virtually everyone in France buys supplemental insurance, which reduces their out-of-pocket costs and covers extra expenses such as private hospital rooms, eyeglasses, and dental care.
France has used price controls and increased government spending to prevent patients from paying more, but the latter effort has led to higher taxes for both employers and workers. In 1990, 7 percent of health-care expenditures were financed out of general revenue taxes, and the rest came from mandatory payroll taxes. By 2003, the general revenue figure had grown to 40 percent, and it's still not enough. The French national insurance system has been running constant deficits since 1985, and these deficits have ballooned to $13.5 billion.
Mr. Shiftright: But regardless, let's say you are completely right, and that the UAW plan is too generous.
That's a decision the automakers and unions made way back when and now they are living with the consequences. But hindsight is always 20-20. They didn't know what they know now, and in terms of health care, they had to offer it. Automakers were high on the hog in the 1960s.
They didn't have to offer it; they decided to offer it. The problem is twofold.
One, it appears as though the companies cannot afford it, and yet they are begging the government for taxpayer money to keep operating. It's therefore fair to examine their cost structure, ask what aspects of their cost structure make them uncompetitive with new rivals, and what can be done about to correct this. The goal for any government aid should be to make sure that GM and Chrysler are viable in the long term not just until the next quarter. "Business as usual" is not acceptable during a time of crisis, and so far that is what both the UAW and management have proposed.
Second, the UAW and others have repeatedly said that nationalized health care is the answer. Maybe some sort of nationalized plan is the answer - although I would imagine we would go with a hybrid plan that relies on both private insurance and a government insurance.
The bottom line, though, is that even the French plan - which does get good results - isn't as generous as the the current UAW plan, and runs a deficit. And people still rely on private insurance (at least, those who can afford to purchase it).
Is the UAW really willing to tell members that they must accept a cut in benefits? Will it demand that the companies fill the gap in coverage between any new national plan and the current plan, which will only reduce the cost disadvantage, not eliminate it (which is what GM and Chrysler really need)?
They also have very high structural unemployment, and lots of people spend time getting degress that end up being worthless. And their social welfare states are under serious strain, both from an aging population and immigrants. Life is pleasant there in many ways, but they also have very serious problems - provided you know where to look.
Mr. Shiftright; It would be great if Americans could do a line by line delete of where their taxes go. That would be utopia for me. We'd be able to punish inefficient systems.
In which case, I'd imagine that the Pentagon and welfare would take the hardest hits, as taxpayers in both blue and red states would vote with their dollars.
RE: health care for autoworkers -- yes, probably some kind of shared cost plan with industry + government is the best solution.
I'm not suggesting that life in Europe is utopian by any means, but government is more responsive to the people. Of course, most people in Denmark are Danes. Having a somewhat homogeneous population helps. And family and community structures are more in place to support people with a safety net, should they fall on hard times.
I found an interesting stat the other day. One American in ten is on food stamps right now.
How did we ever spend so much and get so little for it?
You're partially correct, in my opinion. For all the serious faults that plagued the Vega, such as the awful engine and the very rust-prone body, the chassis wasn't one of them. When it wasn't dead on the side of the road, the Vega actually handled, steered, rode and drove quite well. I know this because, while I never owned a Vega, I spent numerous hours driving and riding in my brother's '73.
I agree that the Skyhawk wasn't in keeping with Buick's positioning in the marketplace and, thus, detracted from that brand's image.
By the way, lemko, did you see the '10 LaCrosse? I saw one at the Washington Auto Show, and I think it may be the best Buick since the downsized '77 large bodies. I think it's nicer than, say, the '09 TL or Avalon, to name two competitors.
My son is autistic. So, yes, maybe you DO pay for his healthcare in your premiums. But how is this different from someone who chooses to live in Fla., knowing that every few years or so they will have to put in a claim for hurricane damage to their house. My homeowners goes up for that. I'm probably getting KILLED paying for Katrina, even though I live in RI. I didn't CHOOSE to have an autistic son. It just happens.
I could disable him and put him on SSI, but I haven't, and probably won't.
I have that with health insurance. I'd love to be one of those folks not getting my money's worth. Unfortunately I'm not. I make up for it in home and auto insurance where all they have to do is cash my checks.
Absolutely!!! Nothing is more precious in life than our health. I just resent it when someone will complain about how they are getting "the shaft" on something (like an insurance premium, or this bailout) without any regard to the faults in their life (like living in tornado alley or the San Andreas fault, or having a poor driving record).
Didn't France have 11,000 people die due to the heat in the summer of 2003? While in hospitals?
Earth Policy Institute.
If the automakers are paying $150 a month for an employee's health insurance, you can see how fast it could run the cost of a car up.
Actually, the TSX wasn't so popular. The offering was too weak to be competitive in its class (of real cars, not repeat Honda buyers). They haven't had a popular car in that category since they killed the Integra, which was considered too down-market for Acura. The TSX was as heavy as the Accord with marginally more power. I think they pulled a badge engineering faux-pas much like the General used to do back in the day.
The V6 makes the car competitive in its class, but no more so than the V6 Accord, the GM vehicles with the 3.6 direct injection motor, or the Ford 3.5 from the Fusion Sport. Honda lost their mojo.
Actually the heat was brutal and the people were very old.
But you know, France is no different than anyplace else when it comes to using your head. There are bad restaurants and good ones, bad cars and good ones, and I'm sure bad hospitals and good ones.
If the doctor kills you or cures you, he gets paid the same. :P
I always like the suggestion of a Health Care System based on the premise that you don't pay the doctor anything at all when you're sick, but he gets a small cut of your paycheck only when you are well. Motivates him to keep you as healthy as possible. :P
Correct me if I'm wrong in my figures, I don't have the time to fish through the sales charts today.
Seriously, the TSX is a hoot. It has the same gearbox found in my S which is by far one of the best I've ever driven. Same goes for the steering, also a Honda strong suit. The seats are supportive, the car is overall very nimble. 200hp was plenty if you weren't afraid of the rev limiter :P . The car (especially the first gen) is basically a 4 door Integra GSR.
On that note, I am also leary of the V6 model and what it will do to upset these traits. Maybe your right about the mojo thing... But then I look at cars like the CR-Z and it gives me great hope.
While I agree with your sentiment there, I hope you did not intend to imply that the US is unique in running up debt. Germany and France have somewhat higher debt as a percentage of GDP than the US. UK's is lower.
https://www.cia.gov/library/publications/the-world-factbook/rankorder/2186rank.h- tml
Correct me if I'm wrong in my figures, I don't have the time to fish through the sales charts today."
Your figure is correct (Honda had stated that they planned on importing 25,000 TSXs the first year), but I don't agree with your conclusions. Why? It always seemed to me that 25,000 was a very low number for Acura's entry level car. It was a slam-dunk number to achieve, compared to its primary competitors, the Integra, RSX and the TL, so it was no surprise when demand exceeded 25,000.
As for the TSX being a hoot to drive, I test drove a manual and had an automatic as a loaner *both first generation TSXs), and my conclusion was that it was okay, but, unlike with its '70s, '80s, and '90s cars, Honda/Acura had played it very safe with the TSX. As a result, it was predictable. It didn't differentiate itself in a positive way, the way previous generation Hondas/ Acuras did. That hasn't changed, and unless it does I probably won't trade our TL for another Acura.
"I am also leary of the V6 model and what it will do to upset these traits."
I agree, for the reasons you mentioned.
There's a lot to that. By going to a third party payer system, a couple of things have happened.
1. People are removed from the true cost of their doctor and hospital visits - it's the insurance company that pays. Hence, people wre not sensitive to rising costs until it started to impact what their employer could afford to pay for.
2. A whole new layer of bureaucracy was created that added to the cost of getting medical services.
I was paying $400 a month health insurance to be abused basically, by the system. On Medicare, I can be abused for a lot less money per month! :P
Given our power and wealth, one would think we would not even be remotely comparable to European countries, that we would excel in every area. But this is simply not the case. Certainly not in either automobiles or health care.
In autos, Japan is one the excels, right? Did you notice that they also "excel" in piling up government debt. At the link I gave, which does not seem to work, it shows Japan's debt at 170% of GDP while the US is at 61%.
https://www.cia.gov/library/publications/the-world-factbook/rankorder/2186rank.h- tml
(if the link does not work, google: "cia world fact book public debt")
Little did we know that we were getting as careless as "Japan Inc".
You can say what you want about the Japanese economy, but those people know how to build a car.
It's important because critics of our current system point to escalating costs of insurance policies. One reason costs are escalating is because mandates drive up the cost of all policies by requiring all policies to provide coverage that not everyone needs.
Even more importantly, treatment for autistic children isn't something that should be paid for via the health insurance system. Insurance should cover catastrophic events that do not happen regularly. Most people won't, for example, get cancer. Insurance should provide coverage so that they won't be bankrupted by the treatment costs if they do draw the unluckly straw.
Treatment for autistic children should be delivered through the educational system, and if everyone is to pay for it, they should pay through their tax dollars that support local school systems.
cooterbfd: But how is this different from someone who chooses to live in Fla., knowing that every few years or so they will have to put in a claim for hurricane damage to their house. My homeowners goes up for that. I'm probably getting KILLED paying for Katrina, even though I live in RI.
If I recall correctly, policy premiums WERE slated to rise dramatically in Florida, but the state put a stop to it based on the complaints of homeowners.
There is no good reason that policy prices shouldn't be higher in Florida to reflect the unique risks of living there. Either don't live there; have the state mandate that all structures be able to withstand a hurricane; or have local property owners pay the insurance premiums necessary to regularly replace flimsy structures built in high-risk areas.
It's called underpromising and overdelivering, something that GM should still learn to do...