What’s at stake for GM and other automakers with UAW strike

What’s at stake for GM and other automakers with UAW strike


JUDY WOODRUFF: Nearly 50,000 workers at General
Motors plants across the country went on strike
at midnight, bringing production to an immediate
halt.
John Yang has the details.
JOHN YANG: It’s the first national work stoppage
by the United Auto Workers since 2007.
As negotiations resumed today, the union said
it had been unable to reach a deal with GM
over several key issues, including higher
wages and limits on the use of temporary workers.
The UAW also wants to end some of the concessions
it made in 2009 to help GM through its government-led
bankruptcy, including lower pay and benefits
for new workers.
James Cotton was on the picket line today
in Detroit.
JAMES COTTON, General Motors Employee: A few
years back, we gave up a lot to keep this
house open and all the houses around General
Motors.
And now that they’re making more money than
they ever have, we feel like we should get
some of that stuff back, like cost of living
and things of that nature.
JOHN YANG: GM posted nearly $12 billion in
profits, but the automaker says it needs to
slash costs as it pivots to future technologies
like electric cars and as sales decline.
Last year, it said it was closing several
plants, including this one in Hamtramck, Michigan,
a decision that President Trump heavily criticized.
Late last year, the “NewsHour”‘s Yamiche Alcindor
went to Hamtramck and spoke to one autoworker
who said her job was her ticket to the middle
class.
D’NITRA LANDON, General Motors Employee: I
have never made this much money hourly before
in my life.
I have never had these great health benefits
before in my life.
JOHN YANG: In a statement, GM said it had
offered new investments in plants that improves
wages, benefits and grows U.S. jobs in substantive
ways.
The strike comes as top UAW leaders, including
current president Gary Jones, are under federal
investigations for allegedly misusing union
money.
The auto industry remains crucial to the U.S.
economy, with some 220,000 people employed
making cars.
Many more make the parts that go into them
and work in other sectors of the industry.
Nathan Bomey is a business reporter with USA
Today.
He previously covered GM for The Detroit Free
Press.
He’s author of “Detroit Resurrected: To Bankruptcy
and Back.”
Nathan, thanks so much for joining me.
NATHAN BOMEY, USA Today: Thanks for having
me.
JOHN YANG: Let’s begin.
They do this every four years.
And the UAW and the Big Three automakers negotiate
new contracts.
Going into this year’s negotiations, broadly
speaking, I want to ask you what the goals
were on each side.
Let’s begin with the UAW.
What did they hope to achieve?
NATHAN BOMEY: Well, I think the biggest thing
that they wanted was to basically end this
two-tier wage system that started about 10
years ago during the bankruptcies of General
Motors and Chrysler, when the auto companies
were on their knees.
The autoworkers helped them get through it
by basically giving concessions.
And so what the UAW wants is to get some of
that back.
On the other side, you have GM and, of course,
the other auto companies that also — they
basically want to eliminate the gap between
them and the foreign automakers, because it’s
still more expensive for the American automakers
to produce vehicles in this country than it
is for Toyota and some of the other foreign
automakers.
JOHN YANG: In their offer that GM released
last night, which is unusual to talk about
what they — what’s on the table while the
talks are still going on, they said that they
made some — offered some investments into
two of the biggest plants that are being idled,
Hamtramck and Lordstown.
Hamtramck, they want to build electric pickup
trucks.
Lordstown, they want to build new battery
cells there with union workers.
Are these going to be able to really get to
the numbers and have comparable jobs that
were there before?
NATHAN BOMEY: Yes, I think it’s unlikely.
If you look at when they made the announcement
that they were idling these plants, the one
in Ohio and the one in Michigan, I mean, these
are political footballs in some sense, because
you’re talking about thousands of workers,
and you have got politicians on both sides
of the fence who have a significant interest
in preserving those jobs.
So I think GM understood that from the beginning.
And now they’re looking and saying, hey, maybe
we can bring some jobs back here.
But the reality is, if they bring batteries
to Ohio, for example, Lordstown, that’s simply
not going to be as many jobs as you would
see with a typical assembly plant.
JOHN YANG: How long is it going to take before
this starts to squeeze each side?
GM is said to have healthy inventories on
hand.
The UAW has a strike fund that they started
beefing up earlier this year.
But when is this going to start to squeeze?
NATHAN BOMEY: If you look at GM’s inventory
levels, they have a few months’ worth of vehicles
at this point.
But that doesn’t mean they have a few months
to spare.
After a couple weeks, they’d run into trouble
because then you would have certain vehicles
or certain trim levels would run into issues,
and then you have people walking into the
dealers and not being able to get those vehicles.
On the other hand, UAW workers only get $250,
$275 a week in strike pay.
So that’s far below what your average worker
is making on a given week.
So they really can’t last too long — too
long as well.
I think you’re looking at a few days, maybe
weeks, before this reaches a head.
But you never know.
There have been strikes in the past that have
gone a couple months.
JOHN YANG: And also not only GM itself, but
the supply chain, their suppliers, the parts
makers start getting squeezed.
NATHAN BOMEY: There is a ripple effect here.
When the automaker can’t make their cars,
then the suppliers can’t make their parts,
and the other automakers can be affected.
JOHN YANG: In the report, I talked about the
federal investigation going into the spending
habits of — or practices of current and former
UAW officials.
Is that a factor in these talks?
NATHAN BOMEY: Well, this is a significant
federal corruption investigation.
And I think the UAW at this point has to fear
a federal racketeering case that could come
on top and basically have the federal government
taking control of the UAW.
That’s what happened to the Teamsters, and
oversight lasted for a couple decades.
So you have to wonder, is the UAW trying to
get this contract done before that kind of
thing happens?
JOHN YANG: And, also, on the other side, what
is GM’s approach to this?
Where they’re seeing this union under investigation,
does that affect their position?
NATHAN BOMEY: GM is walking a tightrope here.
I think you see they’re being very careful
not to be too vocal in their criticism of
the UAW.
At the same time, they have said a few times,
hey, this is a little questionable, but, hey,
UAW, it’s represents tens of thousands of
workers and maybe this isn’t reflective of
the entire organization.
But it is very uncomfortable for them to be
negotiating at the same time they’re under
investigation by the federal government.
JOHN YANG: Earlier today, the UAW said, GM,
if you had given us this offer earlier, we
might have avoided this strike.
Any sense of how long this might go on?
NATHAN BOMEY: Well, you always have to ask
yourself if this is a case of an unreliable
narrator on both sides.
I’m not sure when the official best offer
was really made on each side, who came to
the table first.
It’s tough to say.
But I think, at this point, it doesn’t seem
like they’re miles apart, but they’re not
inches apart either.
I think you got a little time to go still.
JOHN YANG: Nathan Bomey of USA Today, thanks
so much.
NATHAN BOMEY: Thanks, John.

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