More On The $70 Total Labor Cost Per Hour For GM

FLINT JOURNAL - The UAW said last week that it would review its contracts with the automakers and was open to making modifications in them to help the automakers secure needed government loans. Analysts and industry insiders have long said that GM (NYSE:GM) needs to cut its hourly cost per worker down to levels on par with foreign automakers to be successful.
Factoring in retiree health care and legacy costs, GM’s wage and benefit cost for a UAW worker is about $70 an hour, while Toyota’s (NYSE:TM) cost per hourly worker is about $48, said Erich Merkle, lead auto analyst with Crowe Horwath in Grand Rapids. Zuckschwerdt said that number actually already is lower, closer to the low $60s per hour.”That gap has to be zero,” he said.

MP: According to The Canadian Press:

GM, which negotiated the four-year deal that serves as a template for UAW deals with Chrysler and Ford, says its total hourly labour costs dropped 6% this year from pre-contract levels, from $73.26 in 2006 to around $69 per hour. The new cost includes wages of $29.78 per hour, plus benefits, pensions and the cost of providing health care to more than 432,000 GM retirees, GM spokesman Tony Sapienza said.
The total cost will drop to $62 per hour in 2010 when the linchpin of the contract - a UAW administered trust fund - starts paying retiree health care costs.

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