That's good news. Better late to the party than a no-show, after all.

If GM can (albeit slowly and grudgingly) transform to be a lightweight company selling a wider range of higher MPG cars, it'll be good for the American workforce and American taxpayers, as well as provide more competition -- and hence more choices and lower prices -- in the higher MPG market segments.

So GM: welcome.

It will be interesting to see how GM (and Ford) will manage to economically build high quality smaller vehicles with $65/hour North American union workers. It is indeed a very tall order. Unions and their members will not easily accept to produce more (+ higher quality)for much less.

Outsourcing, on a very large scale, may be the only way out, specially for plug-in hybrids, where mechanical and electrical components can be manufactured for a small fraction of the USA/Canada cost.

The North American Car Unions rule or dominamce may be getting near their extinction unless they can find ways to compete against more productive external groups.

Import quota and/or high tariff, (as presently used against the Canadian lumber) to protect the local car industries, will not be accepted by the International communities without strong retaliation.

A fifty percent (50%) progressive devaluation of the USA and Canadian dollar (versus all other currencies)would help to make North American manufactured products more competitive for a while or until such time as union workers get $100 + an hour.

Alternatively, we could 'hope' that the other industralized countries progressively re-evaluate their currency by 100% or more to raise the cost of their manufactured products in USD. This is a much more difficult solution but it already happened, to a certain extend, with the Euro, the Canadian and Singapore $$ etc.

Arificial currency variations can help in the short term, but it does NOT create long lasting increases in product QUALITY or internal PRODUCTIVITY.

Basically, when an industry can no longer compete it should consider the possibility of closing down or moving out and that's what may probably happen with GM and Ford operations in North America, unless......

Don't blame management for UAW intransigence.

"The only way to make and sell 10-15000 buck small cars is to use cheap labor and cut health care costs to the bone. The uaw will never manage to cope so its days are over."

Thats funny. Honda and Toyota don't seem to be having any problems producing small $14k cars in $65 an hour America or Japan. Then again the workers there have never felt the need to unionize against management. I wonder why?

The key word in GM's announcement is "small". GM is perpetuating the stereotypical view that only small cars can get good gas mileage. The 7 year old Taurus I drove to Seattle today got over 30 mpg. I'll bet we could design mid-size cars with even better mileage today if we put our minds to it.

Wintermane,
I have never been a member of the UAW but my brother will be retiring as a GM employee of 34 years at the end of this week. I am a member of the Amalgmated Transit Union and have been disability retired for nearly 3 years. I have often complained about the lack of creative thinking at the international level of the ATU. The unions came into being because of inhumane working conditions of the early 20th century. A factor in the ATU's early history was the number of streetcar operators who were freezing to death every winter. A factor in the UAW's early history was the need to squat over a hole in the factory floor when the need for a restroom arose. The physical beating of production line workers was a normal part of maintaining discipline. Some of the pension expenses GM faces is because of placing too much GM stock in the pension fund's portfolio and it is the UAW's fault only because they let GM get away with it. Compromises have to be made in negotiations. It was because union workers insisted that they recieve a fair share of their productivity that a middle class was so big at one time and all those non union businesses had well paid customers.

So if we bust all our unions and drive our workers' wages back to where they were in 1923 in the name of Free Enterprise, what the hell is so great about Free Enterprise? Our bosses justified all their crimes against workers, nature and other sovereign states in the name of Progress, which only America can dictate. Our workers were talked out of revolution 70 years ago with the promise that their labor would bring genuine improvements in their lives. Result: American wages soared and for the first time in history life was good for ordinary people. If that was all a scam to get workers to disarm while their bosses re-engineered the GOP around racism and Christian bigotry to trick them back into poverty, and welch on all their pension promises, then progress is a lie, and it will be used to screw our descendants forever or until the oil runs out.

Don't say "we won't go that far back". Henry "Hitler's Favorite" Ford generously paid $5 per 10-hour day in 1923. Given the inflation since then, that's about $75-100 a day now. Yet $7.50 to 10 an hour is more than Chinese or Mexican workers get now to make far more advanced cars. If we have to cut our auto workers' wages to Mexican levels to "compete", what happens to our consumer economy? And in 1923 you could buy a Model T for $290. One of Henry's workers thus needed to work 58 days to buy a car. Try doing that with a non-union wage job today.

Don't be smug because you're not a "backward" union worker who deserves to be cheated out of past promises. The wage cutters are coming for you and your promised benefits too. The whiter your collar, the bigger the savings in finding an educated Chinese to replace you. The race to the bottom will make us all losers.

I dont earn alot very few around here do. But its a nice place to live and ive got food and shelter and good people that care about me and a puter and at tv and so on and so forth. Thats better then most and other then the fact im ugly and clumsy and about as handy as teflon coated duct tape I have little to gripe to god about...

And yes im not a union man I dont trust em never will.

Unions should have ceased to be needed a long time ago. The main reason unions exist to this day is due to the generally despotic nature of corporations. If workers had more direct control over the decisions being made exclusively by management there would be no need for unions at all. Breaking unions will do nothing for the long term stability of the industry, it's just addressing the symptom but bringing workers into the decision making process in a meaningful way would effectively bring the unions down and cause the industry to be more efficient. Corporations resist this because it can lower profit, so we're stuck with unions to balance out the power structure.

Kenny,
Rope burns are win :)
Specifically, I agree with you on the expensive US gear that feels and drives cheap.

Everyone here seems to be missing the main point.
Its all about the exchange rate. You go over there with US money and you'll be able to get a weeks's worth of shopping for 10 bucks.
China may have its sweat shops in places as the stereotype would lead you to believe. But the simple reality you will find upon visiting mainland red is in the civilised places where working conditions and proportional living wages are equivalently better then in the US.
They are a modest people who are eager to please an contribute their bit.

The ironic and slightly amusing thing hystorically is the stronger currancies from the stronger nations have always exploited the rest. Sweet justice I say.