48,000 GM UAW Workers Set to Strike Tonight, First Nationwide Strike in 12 Years

-edited

Labor talks between GM and the UAW union have reached an impasse. A Strike is set for midnight tonight.

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

Comments (23)
No. 1-16
Casual_Observer
Casual_Observer

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.

2banana
2banana

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.

2banana
2banana

$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.

hmk
hmk

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.

thimk
thimk

my advice to the Union workers : "take the money and run " .

lol
lol

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.

Wagner99999
Wagner99999

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.

Country Bob
Country Bob

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.

Six000mileyear
Six000mileyear

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.

Realist
Realist

So many conflicting goals. Everyone wants more factories, more jobs and a decent wage for workers. Yet everyone also wants quality vehicles at reasonable prices. Still others would like to see unions disappear and large companies like GM not require corporate welfare.

The reality is that GM has to compete in the global marketplace. They simply can’t keep factories open that produce vehicles that can’t be sold. If you want to avoid more corporate welfare, GM needs to close these plants.

If GM is going to compete globally, they can’t afford to pay workers more than the competition does unless their levels of productivity justify it. This puts unions in a tough spot.

Webej
Webej

Smart move to strike when inventories are non-existent and car customers' wallets are just begging for more production.

Sechel
Sechel

"What's good for the country is good for General Motors, and vice versa" no longer applies. G.M. is simply not the force in this country it was when Charles E Wilson uttered it. G.M. is a smaller share of the U.S. auto market , they produce some outside the U.S. and autos have less importance to GDP than in past decades. It's a news item for sure, but its not the big deal it would have been if it occurred say in the 1950's.

The Unions are fighting a loosing battle. These are yesterday's jobs not tomorrow's The union is just as wrong in fighting the closures as Donald Trump is erecting barriers to foreign imports of steel. Will not be too long before G.M. gives up on cars altogether to focus on electric vehicles if its even a player in that segment.

Sechel
Sechel

Nobody is buying G.M. cars The union is fighting for ghost jobs. Ford has already exited the U.S. car business.

KidHorn
KidHorn

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.

EWM
EWM

The only people who will miss GM is the 48,000 on strike.

wxman40
wxman40

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