This is the second time rank and file have voted down a settlement offer by Deere, albeit this vote was much closer
So what will Deere workers accept on a new contract
Labor component of retail list price is 15 % so management should have room to pay up, especially when top dog earns 14 million and Deere has a very profitable bottom line for share holders
average selling price of a machine is maybe 500,000 with 75,000 [15 % for labor]. Settle a new contract and increase retail price another 25,000 to 525,000 [approx] and I bet as many units would sell and workers get really good increase in pay. Brazil buys some industrial machines in 50 machine lots at a time, so the retail market is hot. It is not COP for machinery but what will the market pay. Same as F 150 trucks. It doesn't cost Ford 80,000 to produce a truck but the market will pay 80,000
Maybe give workers options to hold or sell same as top dog execs would be more fair
Workers are in drivers seat on this one
This settlement will have ripple affects all across manufacturing industry. My son has welders etc working in his shop, and once they hear what the new Deere settlement contract is, they will want raises to equal Deere workers.
Thanks Wayne. Great to see you back.
I might have got mixed up and this post is NTR
If so please move for me
Wayne,
I was the confused one and moved it to Trading but will move it back for you .
Sorry about that!
Hi Wayne. This is, unfortunately, all part of the cycle. It's coded in the algorithm in which we live, IMHO. You've got management, investors, and labor - all competing for as much of the pie as they can get. This is what lost a lot of the auto industry to first Japan, isn't it? I talked to an insurance agent who said that he just insured his first million dollar combine (with two heads).
Again, unfortunately, there is nothing better than the marketplace to sort these things out. Maybe China can do it better - we don't know yet. But I doubt it.
Everything moves in cycles.
I'm sure Kubota is watching closely.