Experts Predict GM Strike Will End in Compromise

With General Motors Corp. and the United Auto Workers union locked in round-the-clock negotiations aimed at ending a crippling two-week strike, the stakes have become so high that a face-saving agreement may be all that’s possible, some labor experts said Monday.

The task of resolving the bitter work stoppage is complicated by both sides’ need to reestablish their credibility--both at the bargaining table and with their own constituencies--as they prepare for national contract talks this summer.

The job is further tangled by the unusual prospect that a pair of small parts factories in Dayton, Ohio, could establish important precedents in hundreds of other GM plants grappling with the same situation--GM’s effort to shift work outside the company, a practice that has become one of the most nettlesome issues facing labor and management today.

“The parties are desperately trying to find a mutually satisfactory compromise without losing face, but they are finding it extremely difficult,” said Craig Brown, a Cleveland-based labor lawyer who often represents management in contract negotiations.

Late Monday, the two sides were continuing a nonstop bargaining session that began Sunday morning. The length of the latest session, coming after 10 days of sporadic low-level talks, the news blackout and the involvement of top GM and UAW officials from Detroit all raised hopes that the two sides were making progress.

The strike by 3,000 workers at two brake plants in Dayton has now shut 25 of GM’s 29 assembly plants and affected 71 other GM parts plants. More than 150,000 GM workers in the United States, Canada and Mexico are idle.

But the effect continued to widen far beyond GM and the UAW. Bethlehem Steel and Caterpillar, which makes truck engines for GM, said Monday that they would curtail some operations as a result of the strike. Scores of independent suppliers have also laid off thousands of employees.

GM is losing an estimated $35 million to $50 million a day, analysts say, and is forgoing production of about 100,000 cars and trucks a week. Dealers expect spot shortages of some popular cars and trucks to pop up soon.

Should the strike last another two weeks, 500,000 people could be out of work, and as many as 1 million within a month, estimates the University of Michigan’s Office for the Study of Automotive Transportation.

The short-term financial pressures to settle are enormous for both sides--on GM to halt the losses, and on workers uncertain about unemployment pay--but both sides also face important internal and external pressures that are serving to prolong the walkout.

“There is a lot of prestige on the line,” said Theodore St. Antoine, a labor law professor at the University of Michigan. “You cannot exaggerate what is at stake--it’s both job security and corporate competitiveness.”

The union is seeking to restore an image that became tarnished after it suffered a humiliating defeat at Caterpillar Inc. last year. The UAW sent workers back to work after it failed to win a new contract from the construction equipment maker.

The Dayton strike comes just two weeks before the union holds its collective bargaining conference to set its negotiating agenda for GM, Ford Motor Co. and Chrysler Corp., whose current national agreements with the UAW expire Sept. 15. A defeat in Dayton would be a political embarrassment to Steven Yokich, the combative negotiator who became UAW president last year.

“He needs a clear victory under his belt,” said David Yettaw, president of Local 599 in Flint, Mich., and a leading dissident who thinks the union’s leadership has often been too accommodating.

GM, meanwhile, is trying to establish that it has the backbone to stand up to the UAW, particularly on the outsourcing issue. The company has been criticized for caving into the union when faced with walkouts or strike threats in recent years. And with GM trying to become competitive globally, the Dayton strike has taken on an importance far beyond those factories.

The pressures confronting both sides, labor experts said, mean a compromise settlement--perhaps one that puts off rather than decides the outsourcing issue--is probably the best that can be expected in the current situation.

One possible model is the 1992 strike at GM’s Lordstown, Ohio, stamping plant, where the company wanted to eliminate 240 tool-making jobs. The dispute ended with an agreement allowing GM to move those jobs outside but requiring it to find other in-house work for the skilled-trades workers. The deal allowed GM to become more efficient long-term and the union to protect jobs short-term.

“If that happened [at Dayton], both could claim victory,” said Sean McAlinden, a labor economist at the University of Michigan.

Whether such a costly compromise will happen in Dayton remains to be seen, of course. But, labor experts said, almost as important as what is decided is how the deal is perceived by the two sides’ constituencies: Wall Street and the union membership.

“Whatever the outcome, they have to be able to package it so that both sides can swallow it,” said Mack Rock, a Cleveland labor lawyer who represents unions. “Conventional wisdom says that if both sides are unhappy, then you got a good deal.”