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Obama Gets Look at New Diesel Technology

President uses Detroit visit to decry anti-union legislation.

by on Dec.11, 2012

President Obama during a visit to Detroit Diesel that took on political overtones as he spoke out against proposed new anti-union legislation.

As he visited the Daimler AG plant near Detroit Monday, President Barack Obama was given a firsthand look at some of the latest high-mileage diesel technology – and details on an investment by the German maker that will add more than 100 jobs to its Detroit Diesel plant.

The president’s visit was intended to help celebrate a $100 million investment by Daimler AG, but the newly re-elected Commander-in-Chief also used the occasion to forcefully speak out against anti-union legislation rapidly working its way through the Michigan legislature.

“We should do everything we can to encourage companies like Daimler to keep investing in American workers,” said the president during his visit to the Detroit Diesel plant. “What we shouldn’t be doing is taking away your rights to bargain for better labor agreements.”

Martin Daum, president and chief executive Daimler Trucks North America, showed the President the German truck maker’s automated manual transmission for diesel engines and the Detroit Diesel division’s new DD15 engine featuring a proprietary turbocharger with a next-generation amplified common rail system, which not only improves performance and fuel economy, but reduces overall weight and complexity.

“The Detroit brand has long been synonymous with power and economy, and the addition of these components to our complete optimized powertrain offerings manufactured at the Detroit brand headquarters will add substantial benefit to our customers’ bottom lines,” Daum said.

Daum explained the addition of the Detroit DT12 automated manual transmission and DD15 proprietary asymmetric turbo to the full line of Detroit brand engines and axles at the facility represents a capital investment of $120 million and will result in the addition of 115 direct jobs to UAW 163, the union local that represent the Detroit Diesel plant.

The president’s visit came a day before a massive Tuesday protest was scheduled to take place in Lansing, the Michigan capital, to protest new anti-union legislation that Gov. Rick Snyder has now said he will sign.  It would make Michigan, a traditionally strong base for organized labor, the 24th state to pass so-called “right-to-work” legislation.

The measure would make it illegal to require workers at an organized plant to contribute dues without their consent. On the other hand, it would also require that those who opt out would continue to share in key union-derived benefits in the form of any new raises or other contract terms.

The legislation has been strongly backed by the Koch Brothers, who advocated similar legislation in Wisconsin and who were major financial backers of failed Republican presidential candidate Mitt Romney.

Only a month ago, the Governor indicated such a measure was “not on (his) agenda.” He now defends the proposal as making Michigan more competitive to businesses looking to expand.

But critics note that the new legislation would also severely restrict unions’ ability to organize and to use their money and clout for political purposes.

One of the ironies of the Obama visit to Detroit is that while the Detroit Diesel facility is organized by the United Auto Workers Union, Daimler’s U.S. Mercedes-Benz assembly plant is located in Alabama, another state with anti-union legislation. The UAW has so far been able to organize that facility.

Paul A. Eisenstein contributed to this report.


Obama Claims New Korean Trade Deal Will Create 70,000 New U.S. Jobs

President also says Detroit bailouts “worth it.”

by on Oct.14, 2011

South Korean President Lee Myung-bak reacts as U.S. President Barak Obama addressed workers at a GM plant in Michigan.

President Barack Obama outlined the promised benefits of the nation’s new trade pact with Korea during a trip to a suburban Detroit assembly plant, suggesting the agreement will generate 70,000 new U.S. jobs – but he drew an especially enthusiastic response from workers when he proclaimed the controversial federal bailout of General Motors and Chrysler “worth it.”

The president journeyed to the Lake Orion assembly plant where he was joined by both South Korean President Lee Myung-bak – who wore a Detroit Tigers baseball cap for the occasion — and United Auto Workers Union President Bob King.  King broke with other national labor leaders this week by lending his support to the trade agreement.

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“The investment was worth it,” Obama said of the $85 billion spent on the domestic auto industry.  Speaking to a cheering throng of workers, the president added that, “This is a city where a great American industry is coming back — and a city where people are dreaming up ways to prove all the skeptics wrong and write the next proud chapter in the Motor City’s history.”

The decision to take his message to the Orion plant was a significant one considering that the factory is producing a small car – the Chevrolet Sonic – that was previously built in South Korea.  GM credits the labor cost reductions it was granted by the UAW in recent years for helping move that production back to the States.  Still, a worker advised the president during his half-hour tour, 27% of what was previously known as the Chevy Aveo still comes from Korea.

President Obama shakes hands with General Motors workers after touting a U.S. trade agreement with South Korea.

The president stressed, during his speech, that the new Korean trade pact – one of an assortment of similar agreements approved by Congress this week – will pay off in many ways.  Most significantly, however, the administration claims it will open up the long-restricted Korean market to U.S. automotive imports.

Late changes to the Korean trade agreement were designed to bolster exports to the Asian nation while preventing a flood of Korean vehicles into the U.S.  The so-called “chicken tax” on foreign-made light trucks, for example, will take 8 years to phase out and should prevent makers Hyundai and Kia from moving ahead with long-discussed plans to start building pickup trucks that could establish one of the most profitable market segments for Detroit’s Big Three.

Until now, automotive trade has been extremely lopsided.  Koreans bought just 7,500 American-made automobiles in 2010 while Korea shipped 562,000 vehicles to the States – a figure that does not include the rapidly-increasing number of vehicles produced at two Korean-owned assembly plants based in the U.S.

The opportunity to level that imbalance in trade helped convince UAW President King to give the agreement his backing, even as other American labor leaders sharply criticized its passage.  (Click Here for that full story.)

Speaking through an interpreter, the blue-and-white Tigers cap on his head, Lee told the GM workers, “I want to give this promise to you, and that is that the (trade pact) will not take away any of your jobs. Rather, it will create more jobs for you and your family, and it is going to protect your job. And that is the pledge that I give you today,”

Ironically, GM could benefit from any expansion in business for Korean automakers as it is that nation’s third-largest carmaker after having purchased the bankrupt Daewoo a decade ago.  A full 20% of the vehicles sold worldwide under the Chevrolet nameplate are produced by GM in Korea.

Obama Set to Visit Chrysler Plant

Journey to Jeep plant carries strong political overtones.

by on Jun.03, 2011

As a candidate, then-Senator Obama made an earlier visit to the Jeep plant in Detroit.

In a move fraught with political overtones, President Barack Obama will visit a Chrysler Group plant in Toledo, Ohio today to hail the ongoing recovery of the once-bankrupt automaker, which has now posted 14 consecutive months of sales growth and is preparing to sever its ties with the government.

The president’s visit, meanwhile, comes just after the automaker finished paying off its federal loans, with Fiat now preparing to buy out the Treasury Department’s remaining 6.6% stake in Chrysler, cutting its ties to the government.

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The Obama administration has made no secret of the fact it considers the bailout to have been an immense success – despite the fact that the White House also disclosed this week it expects $14 billion of the $80 billion advanced Chrysler and General Motors will not be recovered by the U.S. Treasury.

At least initially, the rescue efforts were largely unpopular with the taxpaying public, so the Administration is hoping to focus on the payoff – with an emphasis on jobs.  The White House has argued that despite the costs the bailout probably saved as many as 1 million jobs and helped stabilized America’s manufacturing sector at a time when it was teetering on the brink of disasters.


Opinion: Obama Deserves Cheers As He Tours Detroit Auto Plants

Ongoing Big Three upturn shows bailout was worth it.

by on Jul.30, 2010

Recent events should make it easier for President Obama to promote the bailout of GM and Chrysler.

Whichever side of today’s highly partisan spectrum you fall on, there’s little doubt President Barack Obama’s visit to Detroit is clearly political in nature.  But why shouldn’t it be?  In an era when the merits of almost everything the government does is debated, ad nauseum, the current occupant of the Oval Office has reason to come crowing as he tours a pair of domestic auto plants.

Despite the strong criticism leveled against the bailout of General Motors and Chrysler, last year, there’s growing evidence the tens of billions of dollars invested into the automakers was worth the risk – and that we taxpayers actually may get much, perhaps all, of our money back when the two makers go public once again.

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At a time when critics of the White House weep over the inability to generate jobs – while resisting the need to prop up those out of work – one can only imagine just how deep a hole the American economy might have toppled into had GM and Chrysler been written off.  By most accounts, 1 million jobs were directly at risk, never mind the multiplier effect their collapse would have had on the broader economy.