What the hell is this?

Mother Muckraker is an internal newsletter at the now defunct New United Motor Manufacturing, Inc. (NUMMI) in Fremont, CA. The newsletter seeks to debunk the lies and misinformation spread by Toyota and their "company activists"; and more importantly, inform NUMMI union employees about the real reason why Toyota closed their award winning auto plant on April 1, 2010. NUMMI is dead, but Mother Muckraker lives on to serve as a testament to the greedy machinations of Toyota management. Stay tuned for updates.

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Sunday, March 7, 2010

$1,000,000 Severance Pay

From: MM4

At an average yearly pay conservatively estimated at $60,000 and working for 10 years, you have $600,000. If you work at NUMMI for 20 years, it's $1.2 million. If you take into account an increasing pay after every contract negotiation, health insurance paid for, the 25% matching for the 1st 6% for our 401k; you would have made over $2 million in pre-tax income during those 20 years. So simply being consistent with the "concession bargaining style" of our UAW leadership, we should compromise a bit and only ask for a flat $1 million severance pay per union employee plus 1 quality built Corolla or Tacoma with all the options. But where will the money come from? 3764 WARN (The Worker Adjustment and Retraining Notification Act) notices were sent to NUMMI workers for their layoff. At $1 mil per worker, that comes out to $3.8 Billion. But even with the company's measly $164 mil. proposal, they claim they have to find a "funding source". So, there's no
way Toyota can pay that, or is there a way?

Excerpt from "Toyota Suspends Sales of Key Models" 1/27/10:
http://torontostar.morningstar.ca/globalhome/industry/news.asp?articleid=323751

The firm's balance sheet is fortress-like. At September 30 Toyota had over JPY 3.5 trillion (about $39.4 billion) of cash including its financing arm. Toyota only discloses financial statements excluding the financing arm at its March year-end. On March 31, 2009 Toyota reported cash excluding the financing arm of over JPY 2.1 trillion (about $23.8 billion) and long-term debt excluding the financing arm of about JPY 850.2 billion ($9.5 billion). At the consolidated level, Toyota reported unused short-term and long-term credit lines of about JPY 6.6 trillion, or $73.7 billion. We think this incredibly strong liquidity position allows Toyota to withstand a quality problem of this severity. We will not change our fair value and investment thesis unless we believe Toyota's long-term ability to sell vehicles is impaired.



So what's the problem with a "funding source"? With a little less than 10% of Toyota's cash reserves, they can pay each of us a $1,000,000 severance pay. If they want to borrow money to do it, they have a $73 Billion dollar line of credit at their disposal. With such "incredibly strong liquidity", paying $3.8 billion will not change Toyota's "fortress-like balance sheet" nor will it impair their "long-term ability to sell vehicles." In 2007, Toyota made $14 Billion in profits alone!! We will just settle for a million each. Now, I know the executives’ faces will turn beet red and respond with a collective, "THAT'S OUTRAGEOUS!!!"

No. Lemme tell YOU what's outrageous. It's outrageous that you are shutting down NUMMI after we built the cars and trucks with the lowest defects of all Toyota plants. It's outrageous that you decided to pull the plug on your California plant when 1 in 4 of your cars are sold here. It's outrageous that you're closing NUMMI when the Corolla was the best selling car during "Cash For Clunkers" and the best selling car of all time. It's outrageous that we will be laid off when unemployment is at its highest since the Great Depression. Many of us will have a very hard time finding a job. Our current incomes will not be replaced; and our obligations, whether they be our kids' educations, health care, or mortgages will not be met. Now THAT is outrageous. But with a $1 million severance package (plus 1 quality build car or truck), you can show some goodwill and help mitigate the devastating effects of this plant closure on us and California’s economy.

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