For the first time in 12 years, GM’s UAW Workers Set to Go on Nationwide Strike.
The United Auto Workers (UAW) said on Sunday that its roughly 48,000 hourly workers at General Motors Co facilities would go on strike as of midnight Sunday after U.S. labor contract talks reached an impasse, the first nationwide strike at GM in 12 years.
“We do not take this lightly,” Terry Dittes, the UAW vice president in charge of the union’s relationship with GM, said at a press conference in downtown Detroit. “This is our last resort.”
GM said in a statement that its offer to the UAW during talks included more than $7 billion in investments, 5,400 jobs – a majority of which would be new jobs – pay increases, improved benefits and a contract ratification bonus of $8,000.
The union has been fighting to stop GM from closing auto assembly plants in Ohio and Michigan and arguing workers deserve higher pay after years of record profits for GM in North America.
GM argues the plant shutdowns are necessary responses to market shifts, and that UAW wages and benefits are expensive compared with competing non-union auto plants in southern U.S. states. In its statement, the automaker said its offer to the union included solutions for the Michigan and Ohio assembly plants that currently lack products.
If the strike is short, hourly workers should not suffer much. But strike pay provided by the UAW, which has been building up reserves in preparation for possible industrial action, is just $250 per week.
I Side with GM
The closures are necessary if GM says they are. Companies do not propose to idle plants unless they believe they need to.
It is silly to keep unprofitable or even marginally profitable plants open inventories mounting and the global economy on the skids.
The ratification bonus of $8,000 sounds generous.
Ripple Impact
If the strike lasts more than a week, expect significant ripple impacts on parts suppliers, trucking of autos and parts, and also slowdowns at local bars and restaurants near the plants.
Any workers who have not built up a significant personal monetary cushion will struggle from the first missed paycheck. $250 a week in strike benefits will not go far.
The UAW picked a very poor time to strike, not that there ever is a good time.
Rising Inventories
Strike preparation explains increased production and rising dealer inventories. I wonder if sales are somehow over-reported as a result.
Mike “Mish” Shedlock
Biggest shock I heard on this front was Trumpsters saying that this strike proves that the economy is very strong because they wouldn’t strike in a bad economy. One of the dumbest assertions I have ever heard in my life. So now these union workers know more about the state of the economy than economists? Maybe if I waved a sign at their vote showing the inverted bond market I could have prevented the whole strike right there lol
The only people who will miss GM is the 48,000 on strike.
I recently went mid size sedan shopping. Looked at offerings from GM/Ford/Chrysler and they were non competitive. Their technology was 5 years behind the Japanese and Koreans at a similar price point. Outside of large pickups/SUVs, the US companies offer nothing compelling. Even the sales people at the dealerships have given up trying to sell them.
Smart move to strike when inventories are non-existent and car customers’ wallets are just begging for more production.
The UAW needs to focus on getting all cars sold in the US to be built in the US; otherwise, they are agreeing to send more of their jobs overseas.
A lot of Hondas, Toyotas and BMW are made in the USA (more so than Govt Motors)… they are well made, affordable, and selling well. They are made in Right to Work states, with smaller government and less corruption
Even if the UAW somehow gets its act together, their workers need to be productive enough to support themselves plus thousands of UAW retirees *PLUS thousands of government bureaucrats who’s wages were set when Detroit was still functional.
Workers in other places only have to support themselves.
The people of Detroit continue to vote for big government and big corruption, and they get exactly what they voted for.
You wanted Obama’s cash for clunkers. Stupid UAW members thought that is free money. Now they get the bill.
The facts are: BMW, Honda, and Toyota all make more cars (or greater percentage of their cars) in the USA. Better quality, better prices, and no union dopes.
Remember how Porsche and other legacy manufacturers asked their employees to work for lower salary?
Legacy automakers are screwed. Most of them are too late in electrification game.
Unions will tear them apart.
Electrics aren’t even 3% of the total sales of new automobiles in 2019, and that’s up from 1% or less in years prior. And that’s just a percentage of new car sales, not total number of automobiles on the road.
According to Statstista.com the total number of cars on the US highways (assuming that includes light trucks and SUVs) in 2017 was 272.48 million. According to EVAdoption.com, in 2017, 17 million total cars were sold, and ~200,000 of them were electrics. In 2019 the estimated number of cars sold will be 16.5 million, of which 450,000 will be electric. Assuming all of the electric cars sold since 2016 are still on the road, the total number is 1.13 million. That’s less than 1% of all automobiles. Of course the numbers I’m using only go back to 2016, so maybe there’s a few more than what I can count.
Point is, they’ve got plenty of time.
So you looked on today’s data and made conclusion how future data will look?
Legacy automakers either:
Can make handicapped EVs that no one will buy en masses (e.g. Nissan Leaf, Chevy Bolt, Kona). Of course unless you are a rich one who can afford to own both EV and ICE in the garage for occasional longer trips. OR
Can make somewhat decent ones (e.g. Porsche Taycan, E-tron, I-Pace) but at super high prices that most majority of population can’t afford.
That is the only sane explanation why Porsche and others are cutting their employee salaries to compete with Tesla’s offering. Legacy automakers are huge corporations with various business units. ICE related business units don’t want to allocate their “unclaimed bonuses”/profits to EV R&D. There is a lot of internal bickering going on for the money within BUs.
So you’re arguing that Tesla is going to have a monopoly in automobile transportation? Or that ICE powered cars are going to be around for a very long time? Perhaps you think Apple or Google will introduce their own vehicles?
Building cars ain’t like building iPhones. There’s still a lot of material you have to move, process and attach. And you don’t get the advantage of overseas labor either.
German unions are not like American unions. They are represented at the board level, and are mindful of the survival of their own industry. In Europe politics will put incentives in place to get EV adoption into a higher gear. Gradual shifts will take place.
Aren’t most GM workers temps making 10 bucks an hour?UAW makes up maybe 20%,other 80% temp agencies so who’s gonna notice?GM will just call up the temp agency and order up another couple thousand,problem solved.
Great now people will have to finance cars for 7 years instead of 6. I did experience something a bit odd at a dealership 3 weeks ago. I went to look at the new gmc hd trucks which have just rolled out and although they had a couple in stock an almost exact match to what I was looking for was already built and waiting to be delivered. The dealer is less than 50 miles from the plant. I called Friday and asked what the hold up was and they had no clue why the delay. It struck me as unusual to say the least.
$250 x 48,000 = $12 million per week.
I seriously doubt the UAW has more than 2-3 weeks in their strike “reserves.”
They may actually have to dip into their political campaign reserves.
The UAW spent about $10 million in 2016 (political contributions and lobbying nearly all going to democrats) and $6 million in 2018 (political contributions and lobbying nearly all going to democrats) according to opensecrets.
The entire obama “bailout” pre-packaged bankruptcy of GM was to give one of his main backers, the UAW, a golden bailout package.
100 years of contract law was thrown in the trash with the obama GM bailout. Bond holders got screwed (they should have been first in line) while the UAW barely was touched.
The obama bailout of UAW cost taxpayers a minimum $11 billion (that is after all Treasury shares were sold)
And here we are again. Grifters gotta grift.
There are plenty of workers in places like mexico willing to work for less. UAW is out of step with the forces of globalization and this why parts of the midwest have never grown our of the mindset of entitlement based work.
An experienced tool and die worker is worth his/her weight in gold. $130,000 with overtime is worth every dime.
A janitor making $90,000 is not. Not even close.
I have worked in militant union factories. The waste and abuse is epic. But the worst is the union protecting the worst/overpaid worthless workers you have ever experienced. And they drag everyone down.
You are spot on. Not just for factory unions either. My union in the medical field rewards lazy workers as well.