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non-starter

Burnsville, MN

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#1
Mar 3, 2013
 

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Unions Drive Business Overseas: Roth
By Carol Roth, CNBC Contributor and Business Strategist | CNBC 18 hours ago...

The sequester may be affecting some of the United States' defense budget, but not the part of that is the U.S. Army's Product Improvement Program, which is set to upgrade the Army's old issue M4 rifles to newer M4A1 models.

According to Military.com , after a dramatic bidding and re-bidding process, the M4A1 contract, with an estimated value of approximately $77 million, is going not to incumbent manufacturer Colt Defense nor Remington Arms (owned by Freedom Group), but to a foreign company, FN Herstal. The initial part of the contract award - around $9.3 million worth - was posted at the government's Federal Business Opportunities site earlier this month.

While FN Herstal has its manufacturing plant in South Carolina, the company itself is a subsidiary of the Herstal Group, which, according to its website, "... has been 100 percent owned by the Walloon Region of Belgium," or in other words, the government of Belgium. So, while net-net, manufacturing jobs are preserved in the U.S., the profits go to a foreign entity, which could also engender a loss of sales, administrative and other jobs in the U.S.

So, how does this happen?

FN Herstal underbid both Remington and Colt - in the case of Remington, by a margin of about $7 million. They may have had the luxury to do so because their South Carolina plant is in a "right to work state," where individuals can decide whether they want to join a union or pay union dues. Contrast that with Colt Defense, who had to give UAW union workers at its Connecticut plant a 5.5-percent raise over the past two years. That translates into higher costs for Colt to manufacture its products.

(Read More: The Most Wanted Gun in America)

UAW regional director Julie Kushner said upon the announcement of the union wage hike at Colt Defense, "being able to save jobs allows members to continue producing quality goods that support their families, community and our country." While the pay hike was completed under the guise of helping the union workers, it has quite likely helped those same workers right out of a job by not allowing Colt to be competitive with the South Carolina-located, foreign-owned FN Herstal.

Even Remington, which is based in North Carolina and has manufacturing plants throughout the south, planned to manufacture the M4A1 rifles in its major Ilion, N.Y., facility. New York is another state without right-to-work laws and the Ilion facility is also a union shop, a cost factor in its government bid.

(Read More: Unions Seeking Comeback: Obama 'Owes Them Big Time')

The irony of the situation is that not only have these unions, in seeking to protect their members, hurt them, the companies they work for and the communities that they work in, but the political ideology that has tried to preserve the unions for the benefit of the country has now sent taxpayer dollars to a foreign entity in the form of profits.

There is a lesson to be learned for the unions, for the states and for our country of the ongoing challenge for businesses located in non-right-to-work states. If our own government is willing to give a defense contract to a foreign-owned entity over multiple, capable U.S.-owned entities - including one that incumbently held the previous contract - because of pricing, other entities will be focused on pricing too. States that continue to prioritize union ideology over the need to be competitive in a national and global marketplace may end up with no work at all.
LIbEralS

Saint Paul, MN

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#2
Mar 3, 2013
 

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I'll tell you right now, for the public sector unions at least, don't expect for them to learn any lessions until they actually feel part of the burden.
non-starter

Burnsville, MN

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#3
Mar 3, 2013
 

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The last paragraph says it all:

There is a lesson to be learned for the unions, for the states and for our country of the ongoing challenge for businesses located in non-right-to-work states. If our own government is willing to give a defense contract to a foreign-owned entity over multiple, capable U.S.-owned entities - including one that incumbently held the previous contract - because of pricing, other entities will be focused on pricing too. States that continue to prioritize union ideology over the need to be competitive in a national and global marketplace may end up with no work at all.
non-starter

Burnsville, MN

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#4
Mar 4, 2013
 

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The sequester may be affecting some of the United States' defense budget, but not the part of that is the U.S. Army's Product Improvement Program, which is set to upgrade the Army's old issue M4 rifles to newer M4A1 models.

According to Military.com , after a dramatic bidding and re-bidding process, the M4A1 contract, with an estimated value of approximately $77 million, is going not to incumbent manufacturer Colt Defense nor Remington Arms (owned by Freedom Group), but to a foreign company, FN Herstal. The initial part of the contract award - around $9.3 million worth - was posted at the government's Federal Business Opportunities site earlier this month.

While FN Herstal has its manufacturing plant in South Carolina, the company itself is a subsidiary of the Herstal Group, which, according to its website, "... has been 100 percent owned by the Walloon Region of Belgium," or in other words, the government of Belgium. So, while net-net, manufacturing jobs are preserved in the U.S., the profits go to a foreign entity, which could also engender a loss of sales, administrative and other jobs in the U.S.
liBeRALs

Minneapolis, MN

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#5
Mar 4, 2013
 
You right wing extremists won't be happy until you've driven down wages in the US to the point that the middle class doesn't exist anymore.
non-starter

Burnsville, MN

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#6
Mar 4, 2013
 
liBeRALs wrote:
You right wing extremists won't be happy until you've driven down wages in the US to the point that the middle class doesn't exist anymore.
You left wing liberals won't be happy until you have driven all the good paying jobs overseas.
liBeRALs

Minneapolis, MN

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#7
Mar 4, 2013
 
Perhaps you could give me examples of good paying jobs that are overseas now.

[This should be funny].
non-starter

Burnsville, MN

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#8
Mar 4, 2013
 

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Inge Thulin, a native of Sweden, runs 3M's $15 billion international operations from a 14th-floor perch in Maplewood where, fittingly, a large globe sits in the corner.

"International is the company's biggest growth platform. No doubt," Thulin said. About 40,780 employees work for Thulin, or 54 percent of 3M's workforce, up from 49 percent just six years ago.

3M is pumping millions into new factories, research and technology centers in Brazil, Russia, India, China and Poland and planting seeds for future growth in Turkey, Kazakhstan, and Ukraine.

The idea is to put factories and research centers closer to customers and suppliers to reduce costs and to increase sales opportunities, said Chief Financial Officer Patrick Campbell. More than 43 percent of 3M property and equipment is based outside the United States, up from 35 percent in 2001.

Move a division?

For the first time, some 3M officials have raised the possibility of moving one of the company's six business divisions outside of the United States.

"As for our business unit operations, all are in the U.S. today. Yet half have over 60 percent of their sales from outside the United States," Campbell told analysts last fall. "So one of the things we have to look at is, should some of our business units actually be located outside the U.S.?"

That possibility, and the loss of Minnesota jobs over the past few years, has rankled some longtime workers and shareholders who argue that the company's roots are becoming meaningless. They point to the shedding of about 900 jobs in Minnesota in the last 14 months, more than any other region of the globe and affecting everything from pharmaceuticals to LCD films, auto products, janitorial and office jobs.

Thulin disputed the idea that the overseas growth translates into an abandoning of the United States or Minnesota and noted that Europe has had its share of downsizings. 3M's mission is to grow everywhere, not just overseas, he insisted.

Spokeswoman Jackie Berry noted that 3M has invested in Minnesota, creating a central R&D center in 2002 and expanding Alexandria and Hutchinson plants in 2005 and 2007.

But the sales data reveal how much 3M's growth and stock price is being determined outside the United States: Sales doubled in the past five years in Asia, rose 44 percent in Europe, 39 percent in Latin America, but just 17 percent domestically.
liBeRALs

Minneapolis, MN

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#9
Mar 4, 2013
 

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non-starter wrote:
Inge Thulin, a native of Sweden, runs 3M's $15 billion international operations from a 14th-floor perch in Maplewood where, fittingly, a large globe sits in the corner.
"International is the company's biggest growth platform. No doubt," Thulin said. About 40,780 employees work for Thulin, or 54 percent of 3M's workforce, up from 49 percent just six years ago.
3M is pumping millions into new factories, research and technology centers in Brazil, Russia, India, China and Poland and planting seeds for future growth in Turkey, Kazakhstan, and Ukraine.
The idea is to put factories and research centers closer to customers and suppliers to reduce costs and to increase sales opportunities, said Chief Financial Officer Patrick Campbell. More than 43 percent of 3M property and equipment is based outside the United States, up from 35 percent in 2001.
Move a division?
For the first time, some 3M officials have raised the possibility of moving one of the company's six business divisions outside of the United States.
"As for our business unit operations, all are in the U.S. today. Yet half have over 60 percent of their sales from outside the United States," Campbell told analysts last fall. "So one of the things we have to look at is, should some of our business units actually be located outside the U.S.?"
That possibility, and the loss of Minnesota jobs over the past few years, has rankled some longtime workers and shareholders who argue that the company's roots are becoming meaningless. They point to the shedding of about 900 jobs in Minnesota in the last 14 months, more than any other region of the globe and affecting everything from pharmaceuticals to LCD films, auto products, janitorial and office jobs.
Thulin disputed the idea that the overseas growth translates into an abandoning of the United States or Minnesota and noted that Europe has had its share of downsizings. 3M's mission is to grow everywhere, not just overseas, he insisted.
Spokeswoman Jackie Berry noted that 3M has invested in Minnesota, creating a central R&D center in 2002 and expanding Alexandria and Hutchinson plants in 2005 and 2007.
But the sales data reveal how much 3M's growth and stock price is being determined outside the United States: Sales doubled in the past five years in Asia, rose 44 percent in Europe, 39 percent in Latin America, but just 17 percent domestically.
Your cut and paste didn't in any way answer my question:

Perhaps you could give me examples of good paying jobs that are overseas now.

[This should be funny].

Please post the job AND the rate of pay.

I'll be you can't.

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