This is a clear act of retaliation against a vociferously pro-union state government and UAW demands for job security in the face of looming job losses to EV construction. The fact that Ford has...
Ford Motor Co. on Monday halted construction of a $3.5 billion electric vehicle battery plant project in the Marshall area amid months of battles with local residents, Republicans in Congress over its planned use of Chinese technology and an auto industry strike in its second week.
"We're pausing work, and we're going to limit spending on construction at Marshall until we're confident about our ability to competitively run the plant," Ford spokesman T.R. Reid told The Detroit News on Monday. A "number of considerations" were at play in the company's business decision, he said, but wouldn't say whether the United Auto Workers' ongoing strike of Ford and its crosstown rivals was a factor.
This is a clear act of retaliation against a vociferously pro-union state government and UAW demands for job security in the face of looming job losses to EV construction. The fact that Ford has built EV battery manufacturing plants in anti-union states (Kentucky, Tennessee) employing lower-wage workers ought to be a point of contention, and hopefully the Feds will intervene.
***IANAL, but the U.S. Federal Labor Relations Act specifically mentions that threatening plant closure is an unfair labor practice if it's economically unjustified. Case law has been equivocal on this, and the UAW may not have standing to represent employees of a plant that hasn't opened yet.
Section 8(a)(1) of the Act makes it an unfair labor practice for an employer "to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in Section 7" of the Act. For example, you may not
Threaten employees with adverse consequences, such as closing the workplace, loss of benefits, or more onerous working conditions, if they support a union, engage in union activity, or select a union to represent them.
Honestly, considering that I can go to aliexpress and load up a gigantic assortment of garbage and have it shipped directly to my home for less than $100 tells me that there's very little reason...
Honestly, considering that I can go to aliexpress and load up a gigantic assortment of garbage and have it shipped directly to my home for less than $100 tells me that there's very little reason anything needs to be built anywhere in particular anymore. I doubt there's any reason other than "we can exploit labor more and get kickbacks for building in Kentucky". There certainly isn't any real geographical advantage that I'm aware of. Certainly isn't easier to get goods in or out of.
Mining and initial refinement are probably the only things that truely benefit from close proximity to each other. And even that's not garunteed, as there may be some circumstances that justify shipping elsewhere for refinement.
That's not entirely true. At one time, Michigan was the center of a tightly linked supply chain for auto manufacturing. It had refinement of steel from iron mines in the north of the state, an...
That's not entirely true. At one time, Michigan was the center of a tightly linked supply chain for auto manufacturing. It had refinement of steel from iron mines in the north of the state, an academic infrastructure that turned out highly specialized manufacturing engineers, unions that apprenticed skilled labor, regulatory bodies (the National Highway Traffic Safety Administration's test laboratory), and small suppliers. Water transport and highway networks were all designed around expeditious movement of materials to factories, and manufactured goods outward.
China uses the same pattern of development for efficiencies in the Shenzhen nexus. If it wasn't for the Big 3 oligopoly's slowness to respond to rising fuel prices in the 1970's, there's no reason to have changed the Michigan model. Instead, they decided that labor costs (15% of a car's sticker price) should be minimized.
If we counted the carbon and other environmental costs of long supply chains, built on the lowest available labor price, the math wouldn't turn out well.
I don't disagree with this either, TBH. Part of the reason I like Labor as the base unit for currency is because it would normalize those labor costs. Moving a factory to a different location...
I don't disagree with this either, TBH.
Part of the reason I like Labor as the base unit for currency is because it would normalize those labor costs. Moving a factory to a different location would no longer be a question of labor, but logistics.
Can you expound on that a bit? I'm familiar with the labor theory of value for commodities, but can't imagine how it would make sense as a currency. Naively, it would seem to immediately devalue...
I like Labor as the base unit for currency
Can you expound on that a bit? I'm familiar with the labor theory of value for commodities, but can't imagine how it would make sense as a currency. Naively, it would seem to immediately devalue skill (a skilled mechanic, e.g., would fix a problem with less time and effort than an unskilled one). I'm interested to hear how that problems is averted.
My favorite general concept was explained in this book. This book lays out a conceptual framework for a full socialist society, and thus not everything will make sense outside of that framework. I...
My favorite general concept was explained in this book. This book lays out a conceptual framework for a full socialist society, and thus not everything will make sense outside of that framework. I think a lot of the core functions could be ported over piecemeal in some fashion.
The highest-level short-version as I recall it:
All pay is hourly pay. If you're "on call," you're being paid.
Labor tokens are more like movie tickets and not a permanent asset. The "Fed" creates it, gives it to the earner to spend, and when it is spent it's destroyed. They expire after a certain date to prevent hoarding and disrupting the system. Namely because they're primarily for purchase of consumer goods, and hoarding would allow for excessive manipulation of the price of goods and ruining price signaling.
Price of goods would be market-based, with starting prices corresponding to their total labor cost (taxes may be baked in here as well, my memory fades a bit). This would then have multipliers that modify according to demand and act as a feedback loop for economic planning. A crude example: CarA sales slow dramatically YoY while CarB sales are increasing, so let's lower the cost of CarA to incentivize purchase. Slow/Stop production of CarA until stocks are gone. Increase cost of CarB a bit, and ramp up production, lower costs once inventory of CarA goes away or demand stabilizes against production.
A unit of labor is defined roughly as an hour of labor. Taxes are taken out (so say roughly 1 hour = 0.6 token), a changing multiplier is added to (dis)incentivize certain jobs. Like programmers might get 0.8x while sanitation workers get 3x and doctors get 2x.
An additional multipler that deserves its own point is accounting for differing worker productivity. A labor hour is defined by the average laborer (heavily democratic worker co-op style production for helping determine said average). Then another multiplier for pay of roughly A/B/C pay grades, where A is for the most productive, B is the average, and C is the least productive. One point they stressed was that B/C work is not intended to be shameful, but rather to also accommodate workers that would prefer slower paced work. Thus a highly skilled mechanic would be in the A bucket while a apprentice might be in the C bucket. And the highly skilled mechanic could then either work less or earn more. Given that tokens expire over time, there is active disincentive from overworking.
Jobs like teaching, household labor, and sanitation workers, whom don't produce goods (which are the main thing bought with tokens) but are necessary for society, are paid out of the taxes collected as part of the "baked-in" labor token. The household labor would act in some fashion the way a UBI would.
You also get paid during your studies. I don't recall too many details here offhand, but the idea is to insure students can focus on their studies rather than trying to split their attention between work and school.
Everyone seems to be assuming it's a political move. I'm no expert, but it's not obvious to me. One of the "number of considerations" for pausing the plant might be interest rates? Delays during...
Everyone seems to be assuming it's a political move. I'm no expert, but it's not obvious to me.
One of the "number of considerations" for pausing the plant might be interest rates? Delays during construction result in more interest paid for the time between when the money gets spent and the plant goes online.
Strikes might also cause the company to want to conserve cash, and delaying spending on construction is a way to do that.
Apparently they can't delay too long without it resulting in other penalties, though.
If it were a political message, wouldn't it be more effective politically to be blunt about it? Ambiguity would tend to undercut that a bit.
If they were politically blunt about their motivations, they open themselves up to government, union, and individual legal issues. It's more advantageous to make it ambiguous, even though it's...
If they were politically blunt about their motivations, they open themselves up to government, union, and individual legal issues. It's more advantageous to make it ambiguous, even though it's clear to parties involved that it's not. Think banks refusing to give loans to black people in the 1940's because of the "Risk." Everyone understands.
I'm not saying it is political or retaliation, but I'm also not judging this in a vacuum, where it could potentially look that way. I'm seeing a massive company, that forecasts it's spending years out, holding on a project when every industry in my city is booming with construction. I'm no expert, but if I see multiple industries just tearing up the city to build new plants and warehouses, then it's pretty odd to see a company as big as Ford put a build on hold in the middle of a strike. Judging something like this in a vacuum doesn't do justice to how the current state of affairs or past actions by Ford, coincide with this decision. The last question I ask myself is, if Ford is trying to negotiate in good faith, they shouldn't expect this strike to last so long that they need to put building projects on hold, they should also be concerned about how a decision like this would look to the UAW, whom which they are currently negotiating with. They don't seem too concerned, which tells me most of what I need to know.
This taking "we don't know" and turning it into "actually, we do know" without adding any fresh evidence, so I think something has gone wrong somewhere?
This taking "we don't know" and turning it into "actually, we do know" without adding any fresh evidence, so I think something has gone wrong somewhere?
I can see your point, but to use an analogy: UAW workers are the emotionally/physically abused spouse in a relationship. Their spouse, the auto industry, has a history of gaslighting, emotional...
I can see your point, but to use an analogy: UAW workers are the emotionally/physically abused spouse in a relationship. Their spouse, the auto industry, has a history of gaslighting, emotional abuse, and physical abuse to get what they want out of the relationship. For decades the spouse, UAW workers, have been on the receiving end of this abuse. How reasonable is it to expect the abused partner in this relationship to view their partner's motivations as positive, based on the history of the relationship?
I am, personally, unaware of any time that the auto industry has enthusiastically consented to updated agreements between the two parties. I'm unaware of any time the auto industry has put themselves on the line to protect their employees. In fact, the bit of knowledge I do have says the contrary. The auto industry will take care of itself first and their workers second, even going so far as to sacrifice their workers for their own betterment. That's not to say I am aware of every situation across the decades of history between the two, maybe these companies have truly partnered with their workers at some points.
I'm just saying that nothing about the auto industry's history of behavior lead me to give them the benefit of the doubt, that they wouldn't take retaliatory actions against UAW members if it will help their bottom line.
It's true that the history of labor relations in the US is very bad and the resulting distrust is a big obstacle in the way of any change. Getting to where Germany is seems hardly imaginable. I...
It's true that the history of labor relations in the US is very bad and the resulting distrust is a big obstacle in the way of any change. Getting to where Germany is seems hardly imaginable.
I don't like the "abused spouse" metaphor because it raises the question of "why doesn't she leave him?" and the circumstances don't seem the same at all? Individual workers can sometimes find a better job and quit, and if a lot of people do this then sometimes employers will have staffing problems.
It doesn't seem so easy for auto workers. Despite everything, aren't these still "good union jobs?" It would be hard to find a lot of auto workers new jobs.
Another reason I don't like that metaphor is that I doubt these unionized workers have to put up with anything resembling abuse? Unlike the railway strike, this dispute seems to be about pay, not working conditions?
But I don't know how things work in Detroit. Maybe someone who actually knows the industry could say more.
I suspect they're aware of the NLRA violation inherent in an explicit statement of project cancellation in retaliation for the strike. There's administrative case law ruling against employers for...
I suspect they're aware of the NLRA violation inherent in an explicit statement of project cancellation in retaliation for the strike. There's administrative case law ruling against employers for that kind of action.
But as the article notes, Ford has already had to bend over backwards to answer Republican accusations of collaborating with Chinese manufacturers, and locals unhappy with a big manufacturing facility in their bucolic neck of the woods.
Despite all that, the land is purchased, construction is underway, so you'd think the sunk cost would propel completion. There's a substantial cost to forfeiture of the tax abatement as well.
Good point, I don't know what the legal issues are. There's sunk cost and there's also remaining cost that they haven't spent yet. We'd need to know more about Ford's finances to understand that.
Good point, I don't know what the legal issues are.
There's sunk cost and there's also remaining cost that they haven't spent yet. We'd need to know more about Ford's finances to understand that.
FT had an article today claiming that Ford and other U.S. automakers are having a more difficult time than expected making inroads in the EV market against Tesla. Ford is currently claiming a $4.5...
FT had an article today claiming that Ford and other U.S. automakers are having a more difficult time than expected making inroads in the EV market against Tesla.
Ford is currently claiming a $4.5 billion dollar loss on its EV investments, with only 15,000 electric vehicles sold in 2022.
I'm not buying this altogether - the company has to have a long-term plan to convert facilities, build new plants, and gain market share. The electric F-150, new Mustang Mach-E, and hybrid vehicles are being very enthusiastically adopted, from all I'm hearing, but Ford can't build them fast enough, and their dealership network isn't helping them manage demand well. Overall, new car demand is softer than expected due to high prices (average EV price is still $10,000 higher than average gasoline engine price) and interest rates.
I mean, I personally will never buy a Ford or GM vehicle ever again. Been burned too many times. I strongly feel that neither of those companies does anything in good faith. I've loved my Toyotas,...
I mean, I personally will never buy a Ford or GM vehicle ever again. Been burned too many times. I strongly feel that neither of those companies does anything in good faith.
I've loved my Toyotas, and now am loving a Subaru.
Yes, I feel pretty much the same way, even though I've probably got an oval blue chromosome from all the family ties to Ford. Subaru has provided us with a good experience, but our only...
Yes, I feel pretty much the same way, even though I've probably got an oval blue chromosome from all the family ties to Ford.
Subaru has provided us with a good experience, but our only justification is that we're living in a place which demands AWD at least 4 months of the year.
Frankly the safety features and the roominess in a smaller vehicle is what sold me. I have giant monster children and the Subaru is about the best balance between size and cost. The next car that...
Frankly the safety features and the roominess in a smaller vehicle is what sold me.
I have giant monster children and the Subaru is about the best balance between size and cost. The next car that met my requirements was easily $10k more.
This is a clear act of retaliation against a vociferously pro-union state government and UAW demands for job security in the face of looming job losses to EV construction. The fact that Ford has built EV battery manufacturing plants in anti-union states (Kentucky, Tennessee) employing lower-wage workers ought to be a point of contention, and hopefully the Feds will intervene.
***IANAL, but the U.S. Federal Labor Relations Act specifically mentions that threatening plant closure is an unfair labor practice if it's economically unjustified. Case law has been equivocal on this, and the UAW may not have standing to represent employees of a plant that hasn't opened yet.
From https://www.nlrb.gov/about-nlrb/rights-we-protect/the-law/interfering-with-employee-rights-section-7-8a1
Honestly, considering that I can go to aliexpress and load up a gigantic assortment of garbage and have it shipped directly to my home for less than $100 tells me that there's very little reason anything needs to be built anywhere in particular anymore. I doubt there's any reason other than "we can exploit labor more and get kickbacks for building in Kentucky". There certainly isn't any real geographical advantage that I'm aware of. Certainly isn't easier to get goods in or out of.
Mining and initial refinement are probably the only things that truely benefit from close proximity to each other. And even that's not garunteed, as there may be some circumstances that justify shipping elsewhere for refinement.
That's not entirely true. At one time, Michigan was the center of a tightly linked supply chain for auto manufacturing. It had refinement of steel from iron mines in the north of the state, an academic infrastructure that turned out highly specialized manufacturing engineers, unions that apprenticed skilled labor, regulatory bodies (the National Highway Traffic Safety Administration's test laboratory), and small suppliers. Water transport and highway networks were all designed around expeditious movement of materials to factories, and manufactured goods outward.
China uses the same pattern of development for efficiencies in the Shenzhen nexus. If it wasn't for the Big 3 oligopoly's slowness to respond to rising fuel prices in the 1970's, there's no reason to have changed the Michigan model. Instead, they decided that labor costs (15% of a car's sticker price) should be minimized.
If we counted the carbon and other environmental costs of long supply chains, built on the lowest available labor price, the math wouldn't turn out well.
I don't disagree with this either, TBH.
Part of the reason I like Labor as the base unit for currency is because it would normalize those labor costs. Moving a factory to a different location would no longer be a question of labor, but logistics.
Can you expound on that a bit? I'm familiar with the labor theory of value for commodities, but can't imagine how it would make sense as a currency. Naively, it would seem to immediately devalue skill (a skilled mechanic, e.g., would fix a problem with less time and effort than an unskilled one). I'm interested to hear how that problems is averted.
My favorite general concept was explained in this book. This book lays out a conceptual framework for a full socialist society, and thus not everything will make sense outside of that framework. I think a lot of the core functions could be ported over piecemeal in some fashion.
The highest-level short-version as I recall it:
Everyone seems to be assuming it's a political move. I'm no expert, but it's not obvious to me.
One of the "number of considerations" for pausing the plant might be interest rates? Delays during construction result in more interest paid for the time between when the money gets spent and the plant goes online.
Strikes might also cause the company to want to conserve cash, and delaying spending on construction is a way to do that.
Apparently they can't delay too long without it resulting in other penalties, though.
If it were a political message, wouldn't it be more effective politically to be blunt about it? Ambiguity would tend to undercut that a bit.
If they were politically blunt about their motivations, they open themselves up to government, union, and individual legal issues. It's more advantageous to make it ambiguous, even though it's clear to parties involved that it's not. Think banks refusing to give loans to black people in the 1940's because of the "Risk." Everyone understands.
I'm not saying it is political or retaliation, but I'm also not judging this in a vacuum, where it could potentially look that way. I'm seeing a massive company, that forecasts it's spending years out, holding on a project when every industry in my city is booming with construction. I'm no expert, but if I see multiple industries just tearing up the city to build new plants and warehouses, then it's pretty odd to see a company as big as Ford put a build on hold in the middle of a strike. Judging something like this in a vacuum doesn't do justice to how the current state of affairs or past actions by Ford, coincide with this decision. The last question I ask myself is, if Ford is trying to negotiate in good faith, they shouldn't expect this strike to last so long that they need to put building projects on hold, they should also be concerned about how a decision like this would look to the UAW, whom which they are currently negotiating with. They don't seem too concerned, which tells me most of what I need to know.
This taking "we don't know" and turning it into "actually, we do know" without adding any fresh evidence, so I think something has gone wrong somewhere?
I can see your point, but to use an analogy: UAW workers are the emotionally/physically abused spouse in a relationship. Their spouse, the auto industry, has a history of gaslighting, emotional abuse, and physical abuse to get what they want out of the relationship. For decades the spouse, UAW workers, have been on the receiving end of this abuse. How reasonable is it to expect the abused partner in this relationship to view their partner's motivations as positive, based on the history of the relationship?
I am, personally, unaware of any time that the auto industry has enthusiastically consented to updated agreements between the two parties. I'm unaware of any time the auto industry has put themselves on the line to protect their employees. In fact, the bit of knowledge I do have says the contrary. The auto industry will take care of itself first and their workers second, even going so far as to sacrifice their workers for their own betterment. That's not to say I am aware of every situation across the decades of history between the two, maybe these companies have truly partnered with their workers at some points.
I'm just saying that nothing about the auto industry's history of behavior lead me to give them the benefit of the doubt, that they wouldn't take retaliatory actions against UAW members if it will help their bottom line.
It's true that the history of labor relations in the US is very bad and the resulting distrust is a big obstacle in the way of any change. Getting to where Germany is seems hardly imaginable.
I don't like the "abused spouse" metaphor because it raises the question of "why doesn't she leave him?" and the circumstances don't seem the same at all? Individual workers can sometimes find a better job and quit, and if a lot of people do this then sometimes employers will have staffing problems.
It doesn't seem so easy for auto workers. Despite everything, aren't these still "good union jobs?" It would be hard to find a lot of auto workers new jobs.
Another reason I don't like that metaphor is that I doubt these unionized workers have to put up with anything resembling abuse? Unlike the railway strike, this dispute seems to be about pay, not working conditions?
But I don't know how things work in Detroit. Maybe someone who actually knows the industry could say more.
Are you asking for public evidence of something that by definition would not have public evidence if done on purpose?
No, I'm expecting to live with not knowing for sure.
I suspect they're aware of the NLRA violation inherent in an explicit statement of project cancellation in retaliation for the strike. There's administrative case law ruling against employers for that kind of action.
But as the article notes, Ford has already had to bend over backwards to answer Republican accusations of collaborating with Chinese manufacturers, and locals unhappy with a big manufacturing facility in their bucolic neck of the woods.
Despite all that, the land is purchased, construction is underway, so you'd think the sunk cost would propel completion. There's a substantial cost to forfeiture of the tax abatement as well.
Good point, I don't know what the legal issues are.
There's sunk cost and there's also remaining cost that they haven't spent yet. We'd need to know more about Ford's finances to understand that.
FT had an article today claiming that Ford and other U.S. automakers are having a more difficult time than expected making inroads in the EV market against Tesla.
Ford is currently claiming a $4.5 billion dollar loss on its EV investments, with only 15,000 electric vehicles sold in 2022.
I'm not buying this altogether - the company has to have a long-term plan to convert facilities, build new plants, and gain market share. The electric F-150, new Mustang Mach-E, and hybrid vehicles are being very enthusiastically adopted, from all I'm hearing, but Ford can't build them fast enough, and their dealership network isn't helping them manage demand well. Overall, new car demand is softer than expected due to high prices (average EV price is still $10,000 higher than average gasoline engine price) and interest rates.
I'm still suspicious of the announcement timing.
I mean, I personally will never buy a Ford or GM vehicle ever again. Been burned too many times. I strongly feel that neither of those companies does anything in good faith.
I've loved my Toyotas, and now am loving a Subaru.
Yes, I feel pretty much the same way, even though I've probably got an oval blue chromosome from all the family ties to Ford.
Subaru has provided us with a good experience, but our only justification is that we're living in a place which demands AWD at least 4 months of the year.
Oh hey, off topic but Subaru is a blue oval too!
Frankly the safety features and the roominess in a smaller vehicle is what sold me.
I have giant monster children and the Subaru is about the best balance between size and cost. The next car that met my requirements was easily $10k more.