Ripples Felt Beyond GM On 2nd Day Of Strike
VIDEO | Analysts say a short strike by members of the UAW may actually benefit GM in the long run.
Wednesday, September 26, 2007
DETROIT, Sept. 25 -- The national autoworkers strike against General Motors has forced a U.S. auto-parts maker to lay off hundreds of workers and is disrupting the Canadian economy, with the union president there predicting as many as 100,000 layoffs by the weekend if it continues.
For each day of the strike, GM's production falls 14,000 new vehicles behind rival automakers, according to industry estimates. The struggling auto giant is in danger of losing tenuous beachheads it has established with hot-selling, high-profit vehicles, such as the Buick Enclave and GMC Acadia. A United Auto Workers official said on Tuesday that the union had taken into account GM's inventory before the strike and had warned the automaker before negotiations began to build up inventories of key vehicle lines.
Talks resumed Tuesday against a background of 24-hour nationwide picket lines. A source close to the negotiations, who spoke on condition of anonymity because the talks were ongoing, reported progress but said the two sides still had substantial issues to resolve. The source gave no sense of when a settlement might be reached.
UAW President Ronald A. Gettelfinger said Tuesday morning that he was hoping for a quick end to the strike, as many of GM's 73,000 union workers around the country began budgeting to live on $200 a week in strike pay.
"In many ways it may be a good thing because it will bring an end to this thing quicker," Gettelfinger said in a radio interview on Detroit's WJR-AM. "We are ready to settle the agreement and move on with life. But it takes two sides to do that."
GM did not issue a statement yesterday.
After missing an 11 a.m. Monday deadline for agreeing to a new contract, the UAW went on strike shortly before noon, sending workers out of the company's 80 unionized plants around the country.
The strike may be a gamble for the union, whose members reported making no preparations for an extended walkout. A smaller, more targeted strike would have been easier to sustain. In 1998, the UAW struck at two key GM plants for 54 days, costing the company $12 billion in sales and $3 billion in profit.
GM and the UAW are bargaining over wages, job security for U.S. workers worried about jobs moving overseas, and the company's continued investment in new products and job creation. Another substantial matter, transferring the management of $50 billion in retiree health-care benefits from GM to the union, is not a sticking point, the union said.
Delphi, which makes parts for GM and its rivals, has begun laying off workers at some of its 29 plants, the company said. Though it continues to make parts for Ford and other companies, Delphi depends on GM for much of its revenue. Some Delphi plants, such as the Saginaw Steering Systems plant in Michigan, divide work roughly equally among the Big Three customers. Delphi laid off a small percentage of its 2,700 workers at Saginaw.
But at the Delphi plant in Lockport, N.Y., about 90 percent of the plant's output goes to GM, and most of the plant's 1,900 workers could be laid off if the strike endures, an industry source said on the condition of anonymity for lack of authorization to speak publicly on the subject.
Buzz Hargrove, president of the Canadian Auto Workers union, said GM production in his country is coming to a standstill.