sunny.png
Tuesday September 22nd, 2020 10:59AM

GM talks hit snag as union seeks products for UAW factories

By The Associated Press
Related Articles
  Contact Editor

DETROIT (AP) — Talks between General Motors and the United Auto Workers union hit a snag Tuesday over what the union says is a lack of commitment by GM to build new vehicles in U.S. factories.

In a letter to members, union Vice President Terry Dittes wrote that the union has told GM that it doesn't see a commitment from the company to a workforce that has helped make it billions of dollars.

"We believe that the vehicles GM sells here should be built here," Dittes wrote. "There is no job security for us when GM vehicles are made in other countries for the purpose of selling them here in the U.S.A."

GM did not immediately respond to a request for comment Tuesday night.

Although both sides were still talking, the union demand could be a major sticking point because GM produces pickup trucks and several SUVs in Canada, Mexico, China, South Korea and other countries, and imports them to the U.S.

Dittes wrote that GM's alleged lack of commitment is one of the union's top priorities in talks to end the strike, but little progress has been made.

"Economic gains in this agreement will mean nothing without job security," Dittes wrote, adding that the union is fighting for a middle class way of life.

In the past GM has said it has invested over $23 billion in U.S. factories since 2009, and has created more than 2,000 U.S. jobs so far this year. GM's U.S. factories built about 2 million vehicles last year, including 300,000 that were exported.

Just before the strike began Sept. 16, GM said it offered $7 billion worth of U.S. factory investments resulting in 5,400 new positions, a minority of which would be filled by existing employees. GM would not give a precise number.

A person briefed on the talks later said that $2 billion of that investment would be from joint ventures or parts suppliers that would pay less than what GM assembly line workers earn. The person didn't want to be identified because the talks are confidential.

On Sunday, the union voiced concerns in the talks about GM increasing production in Mexico, where it now builds pickup trucks, small cars and two SUVs. GM led all companies in automobiles produced in Mexico at just over 833,000 last year, according to LMC Automotive and the Center for Automotive Research, a think-tank based in Ann Arbor, Michigan. Of GM vehicles sold in the U.S., 22% are produced in Mexico.

The strike by 49,000 workers, now in its 23rd day, began Sept. 16, and immediately shut down all of GM's U.S. factories. Later two factories in Canada and Mexico were forced to close due to a lack of parts.

The strike has cost the company production of 165,000 cars and trucks and has passed the point where the GM can make up lost volume, according to auto industry analysts.

That means losses are starting to mount for GM even though its dealers have enough inventory to get by for several more weeks.

Talks also were hung up on hourly wage increases versus lump-sum payments favored by the company, according to a person briefed on the talks. They're also haggling over pensions, faster wage increases for workers hired after 2007, and guarantees of new products for U.S. factories, said the person, who didn't want to be identified because the talks are confidential.

Fifteen of GM's 18 North American assembly plants have been shut down by the strike, including everything in the U.S. and one plant each in Mexico and Canada, according to Bill Rinna, director of Americas Vehicle Forecasts for the LMC consulting firm.

"Once the strike ends, it may still take up to a week to get the parts pipeline going again. So we are likely looking at a loss of well over 200,000 vehicles," Rinna wrote in a note distributed Tuesday.

Much of that production can't be made up, especially at factories that make popular pickup trucks and large SUVs that already were on three shifts per day before the strike, said Kristin Dziczek, vice president of the Center for Automotive Research, an industry think tank.

The strike has cost GM about $1.6 billion according to numbers from JP Morgan analyst Ryan Brinkman, who estimates that GM is losing $82 million per day.

Strikers, meanwhile, are in their fourth week without earning a full paycheck from GM of around $1,200 per week before deductions. Instead they have to live on $250 per week in union strike pay.

  • Associated Categories: Associated Press (AP), AP Business, AP Business - Corporate News
© Copyright 2020 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
The Latest: Gov: California should be 'outraged' by outage
California's governor says residents should be outraged and infuriated by news of a widespread power shut-off to prevent deadly wildfires but that the utility had no choice
7:32PM ( 19 minutes ago )
Recuperating Sanders says he may slow down campaigning pace
Bernie Sanders began reintroducing himself to the 2020 campaign on Tuesday, venturing outside his Vermont home to say that he doesn't plan on leaving the race following his heart attack last week
7:24PM ( 28 minutes ago )
GM talks hit snag as union seeks products for UAW factories
Talks between General Motors and the United Auto Workers union hit a snag Tuesday over what the union says is a lack of commitment by GM to build new vehicles in U.S. factories
7:21PM ( 30 minutes ago )
Associated Press (AP)
Railroads to renew push for one-man crews in contract talks
The biggest U.S. freight railroads appear ready to renew their push to reduce their crews to 1 person from the current 2-man operation used at major railroads now
6:32PM ( 1 hour ago )
Trump's Scottish golf clubs extend run of yearly losses
President Donald Trump's two golf resorts in Scotland are posting millions of dollars of losses as his properties contend with a struggling local economy and a backlash against their owner's divisive rhetoric
6:28PM ( 1 hour ago )
Proposals would dam Little Colorado River for hydropower
A newly formed Phoenix-based company wants to put up dams on the Little Colorado River to generate electricity
6:23PM ( 1 hour ago )
AP Business
Tough times for chipmakers as Samsung warns of profit drop
Samsung Electronics expects computer chip slump to clip third-quarter earnings
5:22PM ( 2 hours ago )
Stocks skid as tensions flare ahead of US-China trade talks
Stocks closed broadly lower on Wall Street Tuesday as tensions between the U.S. and China flared ahead of talks aimed at resolving the trade war between the world's two biggest economies
4:50PM ( 3 hours ago )
Parent of Toys R Us teams up with Target to power online biz
Parent of Toys R Us teams up with Target to power online business as iconic toy chain readies launch of 2 stores in November
3:16PM ( 4 hours ago )
AP Business - Corporate News
The Latest: Gov: California should be 'outraged' by outage
California's governor says residents should be outraged and infuriated by news of a widespread power shut-off to prevent deadly wildfires but that the utility had no choice
7:32PM ( 19 minutes ago )
Recuperating Sanders says he may slow down campaigning pace
Bernie Sanders began reintroducing himself to the 2020 campaign on Tuesday, venturing outside his Vermont home to say that he doesn't plan on leaving the race following his heart attack last week
7:24PM ( 28 minutes ago )
9-year-old charged with murder in 5 Illinois fire deaths
A 9-year-old child has been charged with five counts of first-degree murder in a mobile home fire that killed five people in central Illinois
7:21PM ( 30 minutes ago )
California faces historic power outage due to fire danger
A California utility said Tuesday it will cut power to 800,000 customers in what is the largest preventive outage in state history to try to prevent wildfires caused by faulty power lines
7:16PM ( 35 minutes ago )
Trump shifts tone on Turkey in effort to halt Syria invasion
President Donald Trump has moved from threatening to obliterate Turkey's economy if it invades Syria to inviting its president to visit the White House
7:06PM ( 46 minutes ago )