GM Workers Begin Returning as Pact Is OKd
Striking General Motors Corp. employees at two key parts plants in Flint, Mich., voted overwhelmingly Wednesday to end a walkout that virtually shut down the U.S. operations of the world’s largest auto maker.
More than 80% of the striking United Auto Workers union members approved an agreement with GM, the union said. Workers began returning to their jobs Wednesday evening.
GM now must begin the huge job of restarting 25 major plants in the U.S., Canada and Mexico that were shut down because of fallout from the Michigan strikes.
It is expected to take about 10 days for GM to bring vehicle production up to speed, and it could be another month before the normal 50-day to 60-day inventory of cars and trucks is back in stock.
An ambivalent reaction by the stock market toward GM shares Wednesday “shows that no one is completely happy with the settlement,” said Marvin Behm, analyst at Duff & Phelps Credit Rating Co. “Everyone involved took a lot of pain and everyone is now wondering whether it was worth it.”
GM stock fell 13 cents a share Wednesday to close at $74.13 on the New York Stock Exchange, after trading as low as $71.81.
GM has said that the strike cost it as much as $2.5 billion, although some analysts question the numbers, suggesting that the auto maker will be able to offset about half the losses by speeding up production once it brings its factories back on line.
The walkout--the longest at GM in nearly three decades--also extracted a tremendous cost, in lost wages and depleted strike funds, from the UAW and its members.
A union spokesman said Wednesday that UAW officials had not put a dollar value on the losses to the rank and file. But the eight weeks of lost wages and benefits for the idled GM workers could easily approach $1 billion.
Although only 9,200 workers actually went on strike, the 54-day action idled a total of 188,900 GM employees whose plants were shuttered when critical parts from the Flint factories ran out. Thousands of other workers at independent parts suppliers were laid off during the strike and economists say the impact will crimp U.S. economic growth for the year.
The strike was seen as a bid by GM to halt its competitive slide, but many analysts say that the company doesn’t appear to have succeeded--at least not based on early information about terms of the strike-ending agreements that were announced Tuesday.
GM did win a promise of labor peace through the end of next year at one key factory--a brake manufacturing plant in Dayton, Ohio, in return for a promise not to sell or close the plant before then. And it obtained an agreement from the union to devise a plan to increase productivity at its metal-stamping plant in Flint, one of the two facilities that actually went out on strike.
The settlement also sets up a new system for dealing with labor disputes in which GM executives will work with senior UAW leaders to resolve problems before they erupt into strikes.
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* DOOR WARS: GM is late to the party with suddenly popular four-door pickup trucks. W1
