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Foreign automakers pay from $38 to $65 per hour to non-union workers

As leaders for the United Auto Workers gather in Detroit for their Special Convention on Collective Bargaining to work out the negotiating stance for this year's new labor agreements with the Detroit 3 automakers, what they most want to do is figure out how to eliminate the two-tier wage scale. However, the lower Tier 2 wage has allowed the domestic automakers to reduce their labor costs, hire more workers, and compete better with their import competition. As it stands, per-hour labor rates including benefits are $58 at General Motors, $57 at Ford, and $48 at Fiat-Chrysler – a reflection of FCA's much greater number of Tier 2 workers. The Center for Automotive Research released a study of labor rates (including benefits) that put numbers to what the imports pay: Mercedes-Benz pays the most, at an average of $65 per hour, Volkswagen pays the least, at $38 per hour, and BMW is just a hair above that at $39 per hour. Among the Detroit competitors, Honda workers earn an average of $49 per hour, at Toyota it's $48 per hour, Nissan is $42 per hour, and Hyundai-Kia pays $41 per hour. The lower import wages are aided by their greater use of temporary workers compared to the domestics. Automotive News says the ten-dollar gap between those foreign camakers and the domestics turns out to about an extra $250 per car in labor, which adds up quickly when you're pumping out many millions of cars. That $250-per-car number is one that, come negotiating time, the Detroit 3 will want to reduce, as the UAW is trying to raise both Tier 1 and Tier 2 wages. Another wrinkle is that the domestic carmakers are considering the wide adoption of a third wage level lower than Tier 2. Some workers who do minor tasks like assembling parts trays kits and battery packs already make less than Tier 2, but the UAW will be quite wary about cementing yet another wage scale at the bottom of the system while it's trying to fight a bigger battle at the top. News Source: Automotive News - sub. req., BloombergImage Credit: AP Photo/Erik Schelzig Earnings/Financials UAW/Unions BMW Chevrolet Fiat Ford GM Honda Hyundai Kia Mercedes-Benz Nissan Toyota Volkswagen labor wages collective bargaining labor costs

BMW 1 Series dead for 2014

BMW is temporarily abandoning the increasingly competitive and popular compact luxury segment, as it's announced that its 1 Series Coupe and Convertible will be discontinued for the 2014 model year, marking an ignominious end to a line that spawned a pair of excellent high-performance models during its life. Production on the Coupe officially ended in August, while convertible production was taken offline in June.
And while we're mourning the loss of the 1 Series, we're left wondering about the status of its replacement, the 2 Series. That car, which we've already seen inside and out and know the specs on, is expected to make its debut at the 2014 North American International Auto Show in Detroit, although it's unclear just how quickly BMW will get it to showrooms. Assuming BMW doesn't have a bumper crop of already-built 2013 models to hold them over, that leaves Munich-based manufacturer somewhat vulnerable, particularly as Audi and Mercedes-Benz are both launching new models in the compact-premium space vacated by the 1 Series. Any delay in the arrival of the 2 Series could be bad news for BMW, especially if the public is receptive to the new Audi A3 and CLA-Class (early signs suggest that the baby Benz has traction).
In addition, BMW has made a number of changes across the rest of its lineup which are listed below in the official press release. Some of the notable changes, though, include a revised 445-horsepower twin-turbocharged V8 on the 5 Series, a limited-edition Frozen Brilliant White Edition for the 6 Series and the rollout of a new, touchpad-equipped version of iDrive on a number of BMW models. Scroll down for the full press release from BMW.

China probing German automakers over spare parts

The Chinese market has proven to be a boon to German luxury automakers. However, the way that the companies have allegedly been controlling their supply of spare parts has begun to draw the ire of the nation's government. According to insiders speaking to Bloomberg, officials from the country's economic planning organization have opened a probe into Audi, BMW, Mercedes-Benz and some Japanese carmakers over claimed price inflation and limiting supply.
Specifically, the investigation centers around two aspects of how the companies do business, according to Bloomberg. Investigators want to know whether the original equipment component makers are able to sell spare parts only to automaker-authorized dealers or if they are also available to independent shops. There is also the issue of whether the price markup on replacement pieces is too high. The tight controls could be partially explained by China's reputation for producing counterfeit parts.
Evidently, the investigators haven't checked parts prices at car dealers elsewhere in the world. At least in the US, paying more at the dealer for factory components just goes along with owning a vehicle. If evidence of price fixing is found, the companies could face fines the equivalent of millions of dollars, according to Bloomberg.