GM, union struggle for deal as strike rolls into 2nd day
Negotiations between striking United Auto Workers union members and General Motors continued Monday after more than 49,000 workers walked off the job, bringing more than 50 factories and parts warehouses to a standstill.
The union’s top negotiator said in a letter to the company that the strike could have been averted had the company made its latest offer sooner.
The letter dated Sunday suggests that the company and union are not as far apart as the rhetoric leading up to the strike had indicated. But union spokesman Brian Rothenberg said the two sides have come to terms on only 2% of the contract. “We’ve got 98% to go,” he said Monday.
Asked about the possibility of federal mediation, President Donald Trump said it’s possible if the company and union want it.
“Hopefully, they’ll be able to work out the GM strike quickly,” Trump said before leaving the White House for New Mexico. “Hopefully, they’re going to work it out quickly and solidly.”
Trump sought to align himself with the auto workers, telling reporters that he has a “great relationship” with them.
“I don’t want General Motors to be building plants outside this country,” Trump said. “I don’t want General Motors building plants in China and Mexico.”
The strike is the union’s
first walkout against the No. 1 U.S. automaker in over a decade.
The last national work stoppage at GM lasted about two days in 2007, but it remained unclear how long the current impasse might persist. The strike has caught the attention of numerous political leaders, particularly Democrats running for the White House. Both political parties believe the 2020 presidential election could hinge on the economy’s performance in a number of key states, including Michigan, Ohio and Pennsylvania, and a recent manufacturing revival in those states has shown signs of reversal.
GM has been a particular focus for the White House and lawmakers from both parties, who have questioned some of the company’s decisions, particularly related to plant closures.
The workers’ strike drew immediate support from many prominent liberals and Democrats, including 2020 contenders Elizabeth Warren and Bernie Sanders, as well as a vague exhortation from Trump for the two sides to “Get together and make a deal!”
GM and UAW officials sat down Monday to resume contract talks that had been ongoing since mid-July. Before the latest round of talks, the UAW released a letter it sent to GM that said the company had only made a serious offer just two hours before the contract expired on Saturday night.
“We have many important topics to discuss including wage increases, the wage progression for new hires, health care and prescription drug benefits, skilled trades issues, jobs security, profit-sharing and the treatment of temporary employees,” the letter said.
Production at about 33 manufacturing plants in nine states and other work at 22 distribution warehouses was expected to be halted by the strike, making the action a severe impediment to GM’s ability to produce automobiles.
Workers are forgoing their paychecks for each day they do not work, though they will receive a weekly $250 stipend from a fund that UAW keeps for strikes.
“It’s unfortunate that we’re out here, no one wants to be here, but we’ve got to do what we’ve got to do to secure a future for us. And not just us, but for future generations,” said Celso Duque, a 22-year veteran of General Motors at its Detroit-Hamtramck plant, one of four which the company recently announced it plans to shutter. “We hope it doesn’t go a long time. But I don’t think it will be like 2007, with a two-day strike.”
Duque said that priorities for the union included better wages, health care, job security and keeping plants such as Hamtramck open.
Those factory closures, announced by the company in 2018, loom in the background of contract negotiations as the strike unfolds at a fraught time for workers and the U.S. economy at large.
GM made $8.1 billion in profit after taxes last year, leading to workers to be given checks of up to $11,000 each as part of a profit-sharing agreement the company and its unionized workers struck in the previous contract.
But the plant closures, as the company continues to wind down car models such as the Chevrolet Cruze that have fallen out of favor and prepare for an uncertain technological future, hinted at more troubling economic signs.
These broader concerns are likely acting on both parties as they seek to leverage a more favorable contract for the next four years, analysts say.
“GM is not sure what the demand for cars will be in the years ahead given the possibility of autonomous vehicles and ride sharing,” Harry Katz, a professor of labor relations, law, and history at Cornell University. “Meanwhile workers are looking [at] recent profits from GM and they’re pretty strong. And they’ve seen executive pay get high. So they think times are good — happy times are back. They want to get their fair shake and also recover from deep concessions they made in the 2011.”
Workers showed their solidarity at plants around the country as they closed Sunday night. At the Hamtramck factory, cars and trucks honked their horns as they passed picketers in red shirts. Cheers greeted workers as they left an assembly plant in Fort Wayne, Ind., and Parma, Ohio, according to local news reports.
GM said in a statement that it had offered to make $7 billion in investments and create 5,400 jobs, including introducing electric trucks, opening a battery cell manufacturing site and investing in eight existing facilities.
The company declined to give specifics, but said it had offered wage increases, continued profit-sharing and the ability to retain health care benefits to its workers.
“We presented a strong offer that improves wages, benefits and grows U.S. jobs in substantive ways and it is disappointing that the UAW leadership has chosen to strike,” spokeswoman Jeannine Ginivan said in a statement. “We have negotiated in good faith and with a sense of urgency. Our goal remains to build a strong future for our employees and our business.”
The company says its hourly workers make an average of $90,000 a year. The 49,000 full-time and temporary workers represented by the UAW make up about half of its workforce.
Terry Dittes, vice president of the UAW, said that starting wages and upgrading temporary workers to permanent more quickly are two of the biggest focus areas in negotiations.
“Temporary workers are a big issue,” he said. “We have a situation where” Hamtramck employees “have worked for four years as temporary workers. We want a way to make them permanent.”
That has become a key flash point because GM wants more temps to help it weather an expected downturn. The carmaker has said its plants have an average of 7% of their jobs manned by temps. U.S. plants owned by Japanese automakers can have 20% temporary workers or more, which lowers their production costs and gives them more leeway to cut staff in a downturn.
The union also wants entry-level workers, who start at less than $20 an hour, to get the top wage of about $30 an hour in four years or less. Currently, the grow-in period for so-called in-progression workers is eight years.
Another contested issue is the number of skilled-trades workers employed by the automaker. GM has eliminated many skilled-trades job classifications and outsourced some of the work in plants with special agreements. The UAW’s skilled-trades members want better job security, Dittes said.
Workers also want tougher job-security provisions and more investment in U.S. plants, he said, declining to comment on the investment that GM pledged in its deadline-day proposal.
GM disclosed what it called a “strong offer” that included raises, signing bonuses of $8,000 and a promise to preserve the union’s generous health-care coverage.