The UAW Strike

In case you’ve lost sight of it, the autoworkers are still striking against General Motors. The Wall Street Journal reports:

Analysts estimate GM is losing $50 million to $100 million a day from lost factory production, a sum that is expected to make a bigger dent in the company’s second-half performance the longer the work stoppage goes on. JPMorgan Chase last week pegged GM’s losses at more than $1 billion through two weeks of the strike.

GM last week idled its pickup-truck plant in Mexico because of strike-related parts shortages, fully cutting off output of its most-profitable vehicle line.

Workers get $250 a week in financial assistance from the union’s strike fund but that figure is a fraction of their full wage, which is anywhere from $630 to $1,200 for a 40-hour workweek.

Looming behind the strike is GM’s long-range bet on building more electric cars, which require far fewer workers and have more foreign-sourced parts. For the UAW, such plans are a threat to wages and job security.

Issues include the tiered pay system that now prevails in the auto industry with new hires being paid less than veterans, holding the line on the number of workers employed, and preserving the union’s “Cadillac” health care plan.

Possibly the most serious issue is that the union just doesn’t trust GM management and the recent setback in negotiations suggests that the workers’ trust in management is eroding if anything.

When I was a kid a strike like this might well have paralyzed the entire country. That this strike has not shows just how much the auto industry and the whole economy have changed. There used to be thousands of feeder companies, large and small, that were idled when the UAW struck against GM. Now a lot of those U. S. companies have gone out of business, replaced by overseas suppliers. I wonder if the strike is having a measurable effect on the economies of Japan, South Korea, and other countries where today’s auto suppliers are located.

5 comments… add one
  • steve Link

    My sense is that the recent trade wars between Japan and South Korea are a bigger worry.


  • Guarneri Link

    The rank and file will not recoup their losses. And they will hasten a reduction in the workforce. But the UAW leadership will be harmed hardly at all. SNAFU.

  • I honestly don’t know how much room GM has to offer more. GM is paying dividends (something of a rarity these days) so it seems to me that it could offer more. My take is that the union is in a pretty nasty mood at this point.

    Statistically, the rank and file rarely makes back the money lost in a strike and the longer it goes on the worse it will be.

  • Greyshambler Link

    Recoup losses .
    No they won’t. People ask, if you don’t like your job why don’t you just quit?
    Pensions are why. A man has 20-25 years in, maybe that’s what Dave calls deadweight loss. But it’s not money, it’s years of your life, you’re all in and the company and union leaders know it.
    They’ll settle for a small raise and promise of pension increases and in a few years the plants will move.

  • Guarneri Link

    BTW – I don’t believe his wage stats for a second. Those look like common laborers. In 1984 a crane operator in a steel mill made $80K.

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