Carrier leaving Indy for Mexico

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washman

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1,400 Jobs going to Mexico, ostensibly to reduce costs. Plant has been there since the 1950's, my cousin's hubby worked there.

Shame too. I wonder if Carrier units will be cheaper thanks in part to cheap Mexican labor? The article mentions a 2 tier wage with entry workers making up a quarter of the workforce earning 30K per year while the rest make about 55K per year.

So who is to blame here?

I'm sure the opinions will be diverse as they come, but here's my take.

1. Carrier is part of UTC a publicly traded company. As such, investors demand, no matter what, that dividends and stock buybacks take place, sunny or grey.
2. They are probably losing out on new construction and replacement to Goodman, Lennox (which has a plant in Mexico). So does Rheem.
3. Contractors are beating up distributors for lower prices and when Carrier cannot meet them, contractors at the bequest of the homebuyer, go for cheaper.
4. The consumer, as usual, wants the cheapest regardless of where or how or who made it.
5. We have in the last 8 years, moved towards a more anti business attitude and 2 potential candidates on the other side have plans to really "sock it to" big business should they become president.
6 Current admin wants to tax oil and ultimately us to fund more "green" projects.
7. Over the last several decades, we've baked in more and more costs.........social costs if you will that are not present in other locales.
*Unemployment comp.
*OSHA regs.
*EPA regs
*Healthcare, still primarily paid by our employers.

Bottom line is well........ the bottom line. Thanks to asinine trade deals that basically give away the store and get nothing in return, your typical factory worker is competing against slave wages that would make Scrooge blush. 30, 40 years ago, we didn't take our national stupid pill and negotiate dumb deals that benefit investors over workers. How times have changed.

And well there is our good ally, Globalization. More than any time in history, labor and capital and thought are so fluid that no one nation really has a lock on anything anymore. Not even China. A lot of major shoe companies have high tailed it to .........Vietnam because 50 cents an hour in China is far too much. I think in Vietnam, you can get a disposable shoe worker for about 17 cents an hour. That should "hold the line" in price increases from Nike and Reebok I'm sure. Bangladesh, minus pesky OSHA building regs, is fast becoming the world's source of garments of all kinds.

Anyone fly Jetblue? Did you know that in spite of the so called expensive fuel costs, Jetblue deadheads an A320 to............El Salvador for heavy D checks? That's right, they can fly an empty Airbus all the way across the Gulf, get the oil checked, the tyres kicked, and the windows cleaned for less than they could pay an outfit here in the US. I went to school with a chap who did D check stuff for ATA in Indy before they folded. He could clear, back in the 90's 700-900 a week. I believe in El Salvador, you can get a non English literate worker, non FAA certified, for oh about 300/month. Only his supervisor needs FAA certification. Contrast that with the US where the mechanic also has to be FAA certified. Doesn't that warm your heart folks?

The only good thing about all this is my age. At some point, I will pass on and I actually hope it happens before all hell breaks loose. This country has serious problems alright and I don't see a leader on either side that has the intelligence or backbone to right the ship. Used to be I looked forward to the future. Not anymore. I actually envy a senior citizen, twisted at that may sound. At least they are not long for this earth, witnessing the near destruction of our middle class and the hollowing out of our industrial might. In fact most, assuming they have not lost their memory, can fondly remember better times. Economically speaking of course. While I have precious little respect for the so-called Millenials or Young Achievers or whatever the hell they are called, I do feel sorry for them. A little bit anyway.

www.indystar.com

Carrier in Indy, UTEC in Huntington to move units to Mexico, costing 2,100 jobs

Indianapolis mayor Joe Hogsett said news that manufacturing facility is slated for shutdown 'incredibly disappointing.'
www.indystar.com
 
# 5,6,7 especially

great post and thanks for the heads up about carrier going to mexico.Carrier Furnace at work was installed ~june 2008 and just did the first repair yesterday-bearings for induced draft blower started getting noisy-repair took about an hour and two 608vv 5/16 bearings were used :)
 
Washman,

 

I understand and agree with what you're saying.  We have serious problems with both the super wealthy and the very poor ends of society.  I can't comment further or it would have to be in Dirty Laundry.

 

I will say that if someone could go back and knock Sam Walton in the head, our race to the bottom for low priced cheap goods would have been slowed down.  Give that a thought every time you go to Wal-Mart or a similar store.
 
I look at our history

And think of something I read once, in the 50s the US made 2/3 of ALL GOODS PRODUCED, at the same time the Eisenhower administration had I believe balanced budgets with a surplus from 55 or 56 thru 61.......Don't tell me those times weren't better, not perfect, but a damn sight better than now, and then, even the cheapest appliance or piece of furniture was far better than the best produced today, no EPA to tell you how much water or electricity your appliance could use,and all our factories running wide open, you had to hunt in those days to find even Japanese products, must less Chinese!We DID NOT trade with communist countries then!
 
Well that's a damn shame. Central HVAC equipment has been turning into what Window A/C's have been for years, use for a few years and toss it for a new one. I wonder when central HVAC equipment is gonna hit rock bottom, feels like it has already but I'm afraid it hasn't. Just since getting our first Trane system installed in 2008 vast changes have hit the industry mostly with new baseline products below the old base models or base models cheapened. I believe since then Trane's cheapest condensing unit is now fitted with a chinese compressor. Back then the cheapest available was an XB13 with a Trane Climatuff scroll compressor.

Back then I could pretty much pick any equipment and get something made in the US, and certainly nothing had a chinese sourced compressor. Now one has to be very careful what they choose to make sure it's not Chinajunk.

I haven't been impressed with Carrier's quality for years now I wonder how much worse if any it will become now.
 
Going Down to Mexico

This is what the much-derided Ross Perot meant when he said that we will hear a giant sucking sound if NAFTA passes because, in spite of all that was promised about "fair trade", and there's a bullshit term if there ever was one, there was no protection for the workers earning American wages versus the third world wages that would be paid to workers when companies moved out of the US. This has grown to the point of companies here not even having to move jobs off shore. The abuse of the HB-1 Visa (I think that is the name) has allowed Disney to import Indians from India to work at their HQ in Whorelando doing computer work at a fraction of the pay that US employees received to do the same work. Indians are willing to do almost anything to escape their native country. In a story in today's NYT, it is reported that the country is beginning a campaign to give deworming treatment to children, hoping to reach 270 million of them. What the story does not say is that the reason for this is humans defecating anywhere they can find a place to squat because so few of them have proper toilets in their dwellings. The US Disney employees had to train the replacement workers to do their jobs in order to receive their severance pay. A lawsuit that the filers are hoping to turn into a class action suit has been filed. If I were one of the members, I would request that the settlement include breaking the back of each of the executives who planned and implemented this program, paralyzing them from the shoulders down. Then they could spend their wealth on just staying alive, but not enjoying what their wealth brought them. That might help them serve as examples about what is important in life. The visa program was created ostensibly to allow foreign high tech workers to be allowed in to the US to do jobs for which there were inadequate numbers of qualified workers in the US. Now there is a company that specializes in arranging for these Indians from India to be imported to take jobs away from Americans and work for shit wages.

I most sincerely hope that there is an asteroid with Earth's name on it to take out this planet's civilization whose predatory greed has reached unimagined heights.

Reasons 5, 6 & 7 are bull crap. What is being allowed to happen with Carrier is because of government actions wanted by business. Nobody on the right likes government until they need it, like ranchers who want help recovering from drought-caused stock losses or Oklahomans who want disaster relief after tornados or business executives who can import foreign workers, under a federal visa program, to take jobs away from Americans.

I do not know to which items you meant the terms with asterisks to be attached, but maybe it's #7 so let's look at unemployment insurance. What would you envision to help provide for the Carrier workers thrown out of work by the move to Mexico? This is an insurance program that employed people pay into as part of the taxes on their wages. You probably pay into it, too. If you are rendered unemployed, it is your right to collect. I will admit that the Republicans in Congress make it look like a government give away program when they would not even extend the deadline at which payments to the unemployed stopped during the great recession, but it is not. There are taxes taken out of pay for Medicare-Medicaid and Social Security. Most of us are not equipped to take in aging parents or care for disabled siblings like families used to have to do. These programs are far from perfect, but they go a long way to keep older and disabled Americans from dying in poverty and often impoverishing their families along with them as they struggled to pay for medical care. Anyone who has been through this with an elderly parent knows what the bills are like and how fast they eat through savings and social security income.

As for OSHA and the EPA, even in China, where American corporations ran to avoid such regulations, the wide open, no regulation manufacturing has finally been recognized by even that government as responsible for so called cancer corridors around certain factories and high rates of lead poisoning around battery factories. Are those the sort of things you would wish on your family members if they were employed in manufacturing jobs here? Look at what diseases asbestos, the so-called "miracle fiber" of the 1930s, has caused that did not show up until decades after people worked with the material. Are you not glad that you and others are being protected from that danger and similar ones? OSHA set the standards for computer screen radiation when they used CRT monitors and helped people avoid Repetitive Stress Injuries like Carpel Tunnel Syndrome by setting standards for computer keyboard and monitor positioning. This was especially important in the early days of computers coming into offices and being plunked down on regular desks built in a time when computers were only science fiction.

Part of the purpose of Obamacare was that it would remove the responsibility of heath insurance from employers because he said that it put American manufacturers at an unfair disadvantage with manufacturers from other nations where the government provides for health care for all citizens so health care does not have to be a builtin cost on goods produced here.

I do have you beat in that I am already a senior citizen. I guess that will soon be sen~or citizen. I, too look forward to leaving this party soon. I'm sorry about the mess, but I usually tried to clean up mine as I went along and that of others before I left a party, however, this mess is on such a global scale that I think the aforementioned meteor is one of the few solutions to the problem.

PS: I an not a consumer who wants the cheapest. I do not shop an non-union grocery stores and ashamed to admit to buying from Amazon, but I also buy a lot of things from Costco and they treat their employees pretty well, I am told.
 
With a brief tenure at UTC, and former stockholder, I'd bet this is purely a profit move to make more margin on HVAC equipment to pad the short term stock price. UTX has been hammered in market lately, like everything else.
They also have the drama of the old CEO thing, massive spending on their new jet engine, the downfall of elevator sales in China, and as mentioned the competitiveness of their products compared to all the cheaper brands already made in Mexico. They also probably want to get the hell out of their factory from the 1950s. It probably needs maintenance and upgrading, and it's a better investment (sarc.) to just abandon it than to pay for upkeep.

With all the US businesses leaving the US, moving more manufacturing offshore, reneging on pensions, sellouts to foreign firms and governments (cough, GE, cough!) .....I too as one of those stupid, lazy, clueless Millennials, find it hard to have optimism.
There's this hyper-corrosive culture in American business that ONLY looks at ledgers and stockholders.
Let's be honest. It's always been that way. But managers back in the day at least too a wider look at things.
Let's not kid ourselves either. If managers 50 years ago had the technology and the means to tap into the cheaper labor markets abroad, they would've done it!
The only thing that made us a manufacturing powerhouse was our relatively lower wages back in the day, and the fact that there was no other feasible way to manufacture goods.

Go ahead and delete this post if it's *too hot to handle*
 
Go back 100 years and every American had a job, from young children to the old and frail. 
 
It's political and it's the long term prospect of available labor.

 

Why in the world would a business person build a manufacturing plant in places like the U.S. or the U.K., when it's an aging population.

 

As for politics, it's a way of pushing our governmental policies into other countries.  More of a big picture perspective.

 

I'm not saying it's right, I'm just saying...

 

Also, should we be complaining?  In the 1950s, it was all the rage to ponder the "freedom" and "leisure time" future generations would have with increased efficiency in manufacturing. 

 

The U.S. is one of the Financially wealthiest countries on the planet (though it's impoverished in several other ways).  Everyone SHOULD be getting a guaranteed income.  With taxes put back to where they were in the 1950s for the richEST , it would be good all around.  

If memory recalls correctly, Iceland is doing guaranteed income for everyone.  That's the way it should be..... unless you're a middleschool level classist and just HAVE TO HAVE other people to shit on, to pump your ego.  

 

 
 
Trouble is, I guess most of us are guilty of buying from an unscrupulous company at least once!  I am guilty.  In the UK I have sent parcels using a new company called myHermes, who undercut Royal Mail and traditional companies like DHL, FedEx etc.  They use every trick in the book to pay their staff as little as possible.  I believe their delivery drivers are self employed using their own cars and are paid per delivery, typically equating to less than minimum wage which is £6.70/hour equal to US$9.72/hour.

 

I should have gone to a post office and used Royal Mail who have been delivering mail in the UK for 500 years and were government run and highly unionized.  Until recently -- they are now a private company, ending almost 500 years of public ownership.  But they are still heavily unionized of course.  Trouble is they are more expensive than the bunch of shysters who run myHermes.  My bad.  There is a reason why manufactured good and services are so affordable these days.  There has to be a price to pay in other ways.
 
I am not so sure about the comment about low wages in domestic manufacturing historically.  Back then you could have a single income family.  Then again, most families stuck together and had only the children that they could afford.  Take some vintage appliance prices and adjust them for inflation.  It's no wonder that things were built to last and people took care of what they had.  We have a throwaway society and yet we're trying to be green at the same time.  That seems to be contradictory.
 
Back then people PAID for their appliances. If I have the option to pay more for much much better quality than mainstream I will usually consider that route.

Same thing goes for HVAC equipment. It generally costs the same as it did in 1980, not accounting for inflation, so over the years it has come down quite a bit. Now it's being considered a throwaway commodity like everything else and now the quality is coming down to bring the prices down even more. Again, I will pay more to keep the quality up and get something decent. I.e. avoid their new low end lines that were added below the old low end equipment lines.

I guess I fall in a minority in how I like to spend my money. (And I feel most of us on here do too)
 
Yeah that's the unfortunate thing is one has to be careful about the overpriced junk touting to be "old fashioned American quality".

I really hate to say this but I've found quite a few US made or "assembled in USA" goods that ended up being junk too.

As for Friedrich, I noticed years back that their non TOL window units were identical to LG/Goldstar window units (and some GE branded ones too). That's how I became leery of them. Though the LG/Goldstar units were actually pretty good considering their intended nature. They had plastic insides and lasted awhile. My dad actually has a few in his building the oldest one is 13 years old and the rest closer to 10, working fine.
 
I can tell you this, I bought a carrier air conditioner back in 1984. It was when they first brought out the siesta series.

Didn't notice it but when I got the unit home, I looked at the box, and it said made in Mexico. So carrier has been outsourcing to Mexico since 1984.

And yes Tom you're 100% correct about Friedrich. I bought a Friedrich 8000 BTU three years ago, brought it home, look at the box, and there it was as big as Dallas. Made in China. That thing is a piece of crap and I'm throwing it away in the spring time. I paid $319.00 for 8000 BTU air conditioner, that was not any better than a Haier or a Sharp
 
Rental houses, apartments, and inner ring urban. China pride is good enough. Would be a failed mission to put a shiny new Trane outside around here.
 

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