[Straight Vermonter]

Yes and no, that number is not overhead. Rather it is the cost of pay, insurance, vacation, pension and whatever else Detroit paid that was part of a worker’s package.

[Straight Vermonter]

There is a large cost for a corporation to make sure that they are following the rules of their union contract. Think of how much effort companies put into their tax compliance and environmental compliance. Now look at the size of the union contract the auto makers have to comply with:

[muawiyah]

If your objective is to BUILD CARS you will want to measure production line workhours in terms of the cost to achieve one of those hours.

That's all GM claimed the $73 number was about.

If your objective is to figure out if your company has enough lawyers (as employees or on retainers) you will take a look at their won/loss record, and total net cost per suit.

After all, you can always throw another lawyer on the case and increase your probability of winning ~ but all that happens when you add another production line worker is you get an increase in costs.

It's how you line up the production line people and their machines that improves your bottom line.

At GM all those lawyers and marketing people were, it turns out, overhead and the average cost per production line workhour could have been lowered by firing the lawyers and marketers.