United Auto Workers Go On Strike Against General Motors
DAVID GREENE, HOST:
This morning, auto workers are lining up on picket lines for a nationwide strike against General Motors. These are members of United Auto Workers at GM, and they are walking off the job after contract negotiations fell apart. Their decision is expected to halt production across the U.S., with facilities in Texas, Missouri, Indiana, Ohio and Michigan, all impacted. Terry Dittes, the vice president of the union, says the decision to head to the picket line did not come easily.
(SOUNDBITE OF PRESS CONFERENCE)
TERRY DITTES: We do not take this lightly. This is our last resort. It represents great sacrifice and great courage on the part of our members and all of us.
GREENE: I want to start with Tracy Samilton. She covers the auto industry for NPR member station Michigan Radio, and she's with us this morning. Hi, Tracy.
TRACY SAMILTON, BYLINE: Hello.
GREENE: Let's go to the negotiations that were taking place. Why did they break down leading to this?
SAMILTON: I think this strike was probably in the making for a while. GM made a decision to close four plants in the U.S. And the UAW raised its strike pay in March. General Motors wants to reduce its labor costs. The union wants to increase benefits for the workers. And it's basically a perfect recipe for an impasse and the strike that's happening right now.
GREENE: I know you've been talking to some workers as this starts. We heard from the vice president of the union they're saying this is a great sacrifice, it's great courage. What sort of impact are we talking about? What are people telling you?
SAMILTON: Well, it is definitely a sacrifice. You know, the highest-paid workers are going from making about $1,200 a week to about $250 a week. They're going to have trouble paying their bills as long as the strike goes on. But they're nursing a really long grievance here. They helped save the automaker from bankruptcy in 2009. They made a lot of concessions. And they feel, with GM being as profitable as it is right now, it's time for the company to come back and help them out.
GREENE: Tracy Samilton reports for Michigan Radio. Tracy, thanks so much - really appreciate it.
SAMILTON: Happy to be here. Thanks.
GREENE: I want to bring in another voice here. It is Kristin Dziczek. She's vice president of the Center for Automotive Research in Detroit and is following all of this. Hi there, Kristin.
KRISTIN DZICZEK: Good morning.
GREENE: So talk to me about the state of things at GM right now. And how much pressure could this strike exert on the company, and how much pain might it cause for the company right now?
DZICZEK: Well, it depends on the length of the strike. Right now GM has sufficient inventory to last quite a while. And, you know, if the strike is over within a week or two, the impact will be fairly minimal. If it goes on much longer than that, it could be quite devastating. And, you know, we don't yet know how long they'll be out or, really, just how far apart they are at the table.
GREENE: Well, one of the things that the union is demanding of the company is for GM to reopen some shuttered plants. Is that something that's even feasible for GM to consider?
DZICZEK: Well, the plants aren't closed, and nothing is closed ever until the union agrees to close the plant. GM announced that they were not going to put product in four plants in the U.S. - two of them powertrain, two of them assembly. And, you know, GM seems to have offered that they would put products in one of those assembly plants, put some other operations near one of the other assembly plants. They haven't mentioned anything about the powertrain plants.
GREENE: This strike is only affecting GM at this point. But, of course, it's just one of the three - the big three automakers. And there are two others - Ford, Fiat Chrysler. I'm assuming these companies are watching this very closely. But what does this impasse mean for those companies going forward?
DZICZEK: Well, they are watching it closely because the UAW, of course, represents workers at all three companies. And they do something called pattern bargaining. GM is first up this year. They'll reach an agreement, hopefully - a tentative agreement that becomes a contract at General Motors over the next couple weeks. They will then take that pattern to Fiat Chrysler and Ford to try to enforce the same terms of the labor agreement with them. So they are, of course, watching it very closely. And it's not out of the realm of possibility that we may see labor action at those companies, as well, if they reach impasse.
GREENE: I think some people, when they think about GM, they think about one factory in particular, in Lordstown, Ohio. President Trump tweeted about the plant back in the spring, urging GM to make sure that it stays open. What happened to that plant?
DZICZEK: Well, so let me talk broader.
DZICZEK: There's about 3 million units of underutilized capacity across the whole entire U.S. industry. GM owns a million of it. And about a little over 400,000 of those units of underutilized capacity sit in Lordstown, Ohio. So, you know, does GM need to keep a million units of underutilized capacity around? That's why they - that's why they acted in November to unallocate product to these plants. It is a big plant. It's a very important plant. But, you know, General Motors has found other jobs for the people in Lordstown. Many of them involved people having to move outside the community. So they have relocated a lot of folks. But it is a big scar on that community.
GREENE: And relocating, obviously, even if you're keeping a job, is something that can be pretty painful for people and families.
DZICZEK: It can. The UAW has negotiated terms for that, and they do get some compensation for making moves across the country.
GREENE: Anything we can take from the fact that this strike is happening right now? Anything it tells us about the auto industry in 2019?
DZICZEK: You know, there's just so much that's unknown about the auto industry right now. You know, they're facing much higher costs of health care. That's one of the contentious points in this in this negotiation. But also, you know, the trade impacts are costing them money. They don't know what the new terms of trade will be in North America because USMCA has not yet passed. We're waiting to see if there's going to be new tariffs on imported cars and parts into this industry. We don't yet know the fuel economy rules for 2021. There's a lot of uncertainty in this industry. And, you know, this negotiation is looking for certainty for the next four years for these workers.
GREENE: Kristin Dziczek is vice president of the Center for Automotive Research. Thanks so much.
DZICZEK: You're very welcome.
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