Labor only accounts for about 7% of the oricee if a car. Ford has made record profits the past 2 years, so theu could literally just eat the increae labor cost and still be making more in profit than any other point in the company’s history. Of coutse they wont do that because of greed, but there is no actual reason not to.
Of course, although while that 7% is added to the cost of producing the car, other factors may not be as easily negotiable (say a fixed cost of steel or other raw goods).
I actually do agree on the sentiment that a car should not cost more given the labor negotiations.
My argument was just a generalization, and more to say that executive compensation also doesn’t make up a humongous amount of the cost of a car. Moreover, if somehow there is a lack of net profit to render back to the employees, and executive pay is already well controlled, then in such a scenario it may be reasonable to raise the cost of a good in order to adequately compensate the people who make it. In fact, I wish companies did this more instead of asking “how can I exploit labor to make this good more profitable?” And instead ask “is it reasonable to charge more to adequately pay people to live in my community that I do business?” But I digress, the point is simply that profits should be paid back to workers at least as much as profits are paid to shareholders and executives.
The only way employees see that benefit though in our system is in collective bargaining. I’d like to see more cooperatives though.
Labor only accounts for about 7% of the oricee if a car. Ford has made record profits the past 2 years, so theu could literally just eat the increae labor cost and still be making more in profit than any other point in the company’s history. Of coutse they wont do that because of greed, but there is no actual reason not to.
Of course, although while that 7% is added to the cost of producing the car, other factors may not be as easily negotiable (say a fixed cost of steel or other raw goods).
I actually do agree on the sentiment that a car should not cost more given the labor negotiations.
My argument was just a generalization, and more to say that executive compensation also doesn’t make up a humongous amount of the cost of a car. Moreover, if somehow there is a lack of net profit to render back to the employees, and executive pay is already well controlled, then in such a scenario it may be reasonable to raise the cost of a good in order to adequately compensate the people who make it. In fact, I wish companies did this more instead of asking “how can I exploit labor to make this good more profitable?” And instead ask “is it reasonable to charge more to adequately pay people to live in my community that I do business?” But I digress, the point is simply that profits should be paid back to workers at least as much as profits are paid to shareholders and executives.
The only way employees see that benefit though in our system is in collective bargaining. I’d like to see more cooperatives though.