Dale's Motorcycle Blog

The big feature story from the AP today–which I won’t quote from due to their insane copyright policy–is that Harley Davidson is sending executives out to scout potential production locations in other states.  If company can’t come to some sort of agreement with its work force in Milwaukee, H-D will be shutting down production there, and transfer it to assembly plants elsewhere.

Only the Corporate HQ and the Harley-Davidson Museum would remain in Milwaukee.

In many ways, this parallels the problem that US automakers have had, and which led to GM’s bankruptcy. In the case of GM, the union benefit agreements the company made with the UAW, as far back as the 1970s, simply became too difficult to maintain, financially.  As the cost of those benefits increased, GM reached the point where they couldn’t sell a car for the the price that would cover GM’s cost to make it.  GM had net negative cash flow every month, and it burned the company to the ground

Oh, and by the way, despite the happy talk we’ve been hearing, GM, even after bankruptcy, still has a negative cash flow. ALthough, if you’re an American taxpayer, you’re covering that bill.

The MoCo is trying to avoid becoming GM.  So the question for the Milwaukee workforce is whether or not they agree that a somewhat less highly compensated job is better than no job at all.