GM Faces Strike by 12,000 Workers at Huge Michigan Assembly Plant
About 12,000 workers are set to strike today at General Motors’ massive Buick City factory complex in Flint, Mich., if the company and union cannot settle a dispute about overtime and new hiring.
Since Buick City not only makes several car models but also key parts for numerous GM assembly plants, a strike could quickly shut down most of GM’s North American vehicle production just as the 1995 model year kicks off.
“It would certainly be a pretty effective strike on the car side of the business,” said William Hoglund, GM executive vice president.
The threatened strike by the United Auto Workers comes as Detroit auto makers are running assembly and parts factories at capacity and many employees are working 50- to 60-hour weeks to meet demand for cars and trucks.
The dispute highlights a peculiarity of the current boom in auto sales. In past cycles, Detroit met demand by going on hiring and plant-building binges. When sales slackened, workers were laid off and plants shut at great cost.
This time around, the auto makers are producing more vehicles with fewer workers and no new factories.
The result is plants operating to the limit and workers complaining about burn out. Just last week, Ford Motor Co. cut back production at two plants when workers at an Indianapolis parts facility refused to work overtime.
The dispute at GM comes as it is paring the ranks of hourly workers to match the efficiency of competitors. With the high cost of pensions and health benefits, the company said it will not hire new permanent workers.
But the union says its members are exhausted and that the long hours are taking a toll by reducing work quality and increasing injury rates. The UAW wants GM to hire hundreds of more full-time employees.
“Workers are getting tired,” said Gary Mattson, recording secretary for UAW Local 599 in Flint, noting that some workers have been putting in 10 to 12 hours a day, seven days a week.
The labor dispute in Flint is the latest in a series of local disagreements that have plagued GM in the last year. The other negotiations largely revolved around job security and the use of cheaper, non-union workers to produce parts.
For instance, a strike last month at a parts factory in Anderson, Ind., shut down 15 GM assembly plants within three days.
Other disputes are looming as well. Workers in plants in Toledo, Ohio, and Warren, Mich., have authorized strikes although leaders have not yet set deadlines for walkouts. Overtime and staff shortages are concerns at both of those plants.
The likelihood of a strike, at least a lengthy one, at Flint is not considered high because GM cannot afford to lose sales and cede more market share to other auto makers, analysts said.
“GM will cave in because they have to,” said David Healy, analyst with S.G. Warburg & Co., a New York brokerage. “The union has all the cards because they can shut down the company in a couple of days.”
A glimmer of hope that a strike could be averted appeared this weekend when GM agreed to hire 118 new full-time workers at its Inland Fisher Guide components plant in Flint.
As part of a cost-cutting effort, GM has reduced its hourly work force by 15,000 to about 247,000 workers since the beginning of the year. In 1988, when the last auto sales boom ended, GM had 373,000 hourly workers. Still, a recent study found that GM uses about 25% more manpower to build a car than Ford or Chrysler.
The company this year hired about 7,000 temporary employees to help it meet rising demand, but recently let most of them go at the UAW’s insistence. Instead, the union is demanding that more full-time workers be hired.
“Greedy employers, as short-sighted as ever, are trying to produce far too much product with far too few people,” UAW President Owen Bieber complained in a speech this month.
GM wants to move as many as 4,200 laid-off workers from closed plants--including former employees of the closed Van Nuys assembly plant--to factories running at capacity.
But many of those workers refuse to move, even when offered $60,000 incentive packages.
The company also wants to move more work to outside suppliers who are often non-union and can offer wage-and-benefit rates sometimes half the $42 an hour that UAW workers receive.”We just can’t afford that kind of cost structure,” Hoglund said.
The Flint complex produces the Buick Park Avenue and LeSabre and the Oldsmobile Eighty Eight. In addition, it makes engines and key chassis and transmission components used in most of GM’s U.S. and Canadian assembly plants.
