The UAW & The Detroit 3 – A Dysfunctional Relationship That Bankrupted The American Auto Industry

Just 12 months ago – after record setting losses by the “Detroit 3” ……….

UAW Puts Chrysler on Strike Notice


 UAW Strikes Chrysler!


UAW workers just walked out of Chrysler assembly plants.

UAW On Strike Against GM

DETROIT, Sept. 25, 2007

(CBS/AP) Thousands of United Auto Workers walked off the job at General Motors Corp. plants around the country Monday.

UAW President Ron Gettelfinger said the union launched the strike after “one-sided negotiations” failed to reach an agreement.
If you’re looking to buy a car, you’re not going to notice this strike, reports CBS News correspondent Anthony Mason. GM has a two-month backlog of inventory that will keep it in business for a while.
“The bargaining involves complex, difficult issues that affect the job security of our U.S. work force and the long-term viability of the company,” he said. “We remain fully committed to working with the UAW to develop solutions together to address the competitive challenges facing GM.”

Just weeks after GM announced a $38 Billion Dollar loss in the third quarter of 2007 ………

UAW’s Gettelfinger: General Motors “Pushed Us Into a Strike”


 Indeed, it will hurt GM. It will cost hundreds of millions of dollars at a time when GM’s turnaround is just beginning to take hold, but remains fragile. It will hurt GM sales at a time when GM has had some sales momentum in specific areas, like the Saturn division and the crossover segment. And GM is on the eve of launching some critical new models, specifically the Chevrolet Malibu and Cadillac CTS.

The 1998 strike was debilitating to GM. The automaker lost money and market share — share it never regained.

GM has to stick to its guns for its survival. No way will GM CEO Rick Wagoner sign a deal like the one former GM Chairman Bob Stempel did more than a decade ago. That one still reverberates on GM’s balance sheet.

In those 1990 negotiations, Stempel, so as not to bear a strike, was seen as caving to the union on issues of job security, and the Jobs Bank that pays people in full when they are displaced from their jobs but maintains pay and benefits, like health care coverage and pensions for active workers and retirees.

Subsequently, a boardroom coup led to the ouster of Stempel and GM President Lloyd Reuss, with the union contract at the top of the list of their transgressions.

GM is still paying for that contract today.

Lengthy UAW Strike Could Cost GM Billions, September 25, 2007 · In calling a strike against General Motors Corp., the United Auto Workers took a bold gamble that it could get a stronger contract by shutting down an already weakened company.

Monday saw 73,000 UAW members at about 80 U.S. facilities walk off the job, citing concerns over job security and health care. The dramatic move came after 20 days of negotiations. The talks continue.

If the strike does drag on, it could take a huge toll on both sides.

If the strike lasts longer than a week or two, it could cost GM billions of dollars and stop the momentum the company was building with some of its new models, industry analysts said.

A strike lasting close to a month or more would cause GM to burn up $8.1 billion in the first month and $7.2 billion in the second month. They are losing money every day the strike takes place. Very shortly it will paralyze their Canadian and Mexico operations,” Shaiken said.

“They are losing money every day the strike takes place. Very shortly it will paralyze their Canadian and Mexico operations,” Shaiken said.

But the longer the union stays on the picket lines, the more it could encourage GM to ship more jobs abroad.


Steven Pearlstein                                                                                                                                                                                       Washington Post Columnist
Wednesday, September 26, 2007; 11:00 AM

You raise an interesting question though: suppose a company’s wages and benefits have got way out of line, with serious consequences for the competitiveness and profitability of the company. Its losing lots of money. If you are a worker, you can bitch and moan and say, “Why should I have to take a $12 pay cut?” just to use your hypothetical. Getting your pay cut is a lousy thing to have happen to you. Or you can say, “Look, we obviously got way above market for my set of skills, I had a good run at above market wages, and now I have to decide if I want to work for a market wage, which is less, or try to earn more by looking for a new job. But I understand that if I don’t agree to cut my wage, there won’t be a company left to work for for very long, or it will file for bankruptcy reorganization and I’ll be paid $12 less anyway, only my pension will be seized by the creditors.” So this is the reality. You chose to see it only through the narrow lens of the worker, and come up thinking its unfair. But tell me: was it “fair” that, for all those years when the Big Three owned the US market, that people paid more for their cars (on a quality adjusted basis) than they should have so these workers could earn twice what other American workers did with the same skills, working under the same conditions? The harsh truth is that, in business and economics, fairness in that sense doesn’t have much to do with things.

Strike 2: UAW shuts down Chrysler

More than 32,000 workers start second nationwide auto strike in less than two weeks, this time hitting No. 4 U.S. automaker.

By Chris Isidore, senior writer

NEW YORK ( — More than 32,000 members of the United Auto Workers union struck Chrysler LLC on Wednesday, after marathon labor talks between the union and the money-losing automaker failed to avert the industry’s second strike in two weeks.

The strike affects 18 manufacturing plants and 30 other facilities, spread across 14 states.

The new CEO of Chrysler is Robert Nardelli, who was ousted as the CEO at retailer Home Depot (Charts, Fortune 500) after a dispute over his lucrative pay package, coupled with that company’s poor stock performance.

The union’s members at Chrysler get $28.75 an hour in straight wages, according to Chrysler. That comes to just under $59,000 pay when calculated for a 52-week, 40-hour a week year. Overtime pay and other adjustments generally takes the pay even higher.

But the total labor cost is far above that hourly wage when the cost of health care for both active and retired employees, as well as pension and other benefits, are factored in. Chrysler estimates it pays $75.86 an hour in total hourly labor costs. That’s not only significantly more than the $46 an hour average at the U.S. plants of Asian automakers, but it’s also higher than GM and Ford have been paying.

GM’s labor costs came to $73.26 an hour even before the latest cost-saving labor deal, while Ford was paying $70.51.


UAW strikes American Axle                                                                                                                    March 28th, 2008

The strike sends 3,650 American Axle workers in Michigan and New York to the picket lines and threatens to snarl truck production at General Motors Corp., the parts maker’s largest customer.

UAW on strike at GM crossover plant in Michigan                                        Thu Apr 17, 2008


DETROIT (Reuters) – A local unit of the United Auto Workers went on strike on Thursday at a General Motors Corp (GM.N: Quote, Profile, Research, Stock Buzz) plant that builds fast-selling crossover vehicles, adding to disruptions caused by the union’s walkout at American Axle & Manufacturing, a major supplier to the automaker.



Members of UAW Local 602 who work at GM’s Lansing Delta Township plant near Lansing, Michigan, walked off the job just after 10 a.m. ET after the automaker and local union leaders failed to agree on work rules and other issues.


shed: Mar 07, 2008 12:30 AM

Modified: Mar 07, 2008 02:41 AM

DETROIT – General Motors shut down another plant Thursday …..

GM temporarily idled its Wentzville, Mo., assembly plant after it ran out of parts from American Axle. The plant employs nearly 2,000 people and makes the GMC Savana and Chevrolet Express vans.

About 3,600 UAW workers at five American Axle plants in Michigan and New York walked off their jobs Feb. 26.

GM said that including the plants that are set to close Monday, about 19,000 manufacturing workers have been affected by the shutdowns, or nearly a quarter of its North American manufacturing work force.

As Talks Drag, American Axle Strike Enters Third Month  

 Although the two-month-old strike at parts-maker American Axle (AAM) has shut down 30 General Motors plants and idled more than 40,000 GM workers, the United Auto Workers appear unable or unwilling to make use of their leverage to reach a settlement.





Wednesday February 27, 2008, 8:43 PM

“What was once the model (GM) spin-off is now the highest-cost supplier in North America,” Sean McAlinden, chief economist at the Center for Automotive Research in Ann Arbor said Wednesday. “It’s sad to see. It’s not a good signal for Michigan once again.” 

In a statement, American Axle Chairman Richard Dauch said the company isn’t competitive at its current wage-and-benefit level.

The total cost of wages and benefits is more than $70 an hour, Dauch says, while competitors such as Dana Corp. are paying $20 to $30 an hour in total wages and benefits. American Axle did post a profit of $37 million last year, but the earnings were an anemic 1 percent of sales.

In its 2007 annual report filed with the Securities and Exchange Commission Feb. 21, American Axle said it’s working to diversify its products beyond truck axles. But the company said its ability to compete for new business “may be adversely impacted” if it is unsuccessful in cutting labor costs in a new UAW contract.

GM: Strikes will cost it $2B pretax in 2Q




With this dysfunctional history why should the Detroit 3 and UAW be trusted with $34 Billion in taxpayor funds? How can anyone be surprised that these Companies are Bankrupt!
DETROIT — General Motors’ (GM) stock fell almost 5% Friday after the company reported that strikes at some of its own plants and parts supplier American Axle (AXL) will cost the automaker about $2 billion before taxes in the second quarter. GM also expects to produce 230,000 fewer vehicles during the quarter due to the nearly three-month American Axle strike, which crippled its production of large sport-utility vehicles and pickups. The other strikes will cost it 33,000 vehicles. “We anticipate only a portion of this lost production will be recovered, due to the current economic environment in the United States and to the market shift away from the types of vehicles that were impacted by the action at American Axle,” GM said in a filing with the U.S. Securities and Exchange Commission. GM’s shares fell 83 cents to close at $17.60, after touching $17.38 earlier in the session, their lowest level in nearly 26 years. The last time GM traded below $17.46 was Oct. 6, 1982, when it was at $17.32, according to the Center for Research in Security Prices at the University of Chicago.


Strike at American Axle ‘not a good signal’

by Rick Haglund | Press News Service


According to GM’s website, some 3,300 hourly workers were employed at the plant at the end of April 2007.


GM also faces another possible strike by a UAW local unit at 10 a.m. ET Friday if the company and local leaders at a Warren, Michigan, transmission plant cannot reach agreement.

American Axle strike shuts GM truck plant

Posted by Associated Press February 28, 2008 17:44PM

American Axle strike shuts GM truck plant

Posted by Associated Press February 28, 2008 17:44PM

Categories: Breaking News, Business

DETROIT — General Motors Corp. says it has temporarily shut down a Pontiac pickup truck plant because of a strike at a parts supplier.

GM spokesman Tom Wickham says the Pontiac Assembly Center stopped making trucks when the first shift ended Thursday afternoon. He would not speculate on when the factory might reopen.

The plant employs about 2,500 hourly and salaried workers who make the Chevrolet Silverado and GMC Sierra pickup trucks. Other plants that make the trucks are still open.

Hummer H2 plant to shut down because of American Axle strike

Mar 3, 2008 at 5:37 PM EST



ST. JOSEPH CO. — The Hummer H2 plant in St. Joseph County will shut down production sometime Tuesday, meaning 400 local workers will be temporarily off the job.



Employees leaving the plant Monday afternoon were preparing themselves for the long haul.

“We might be laid off a long time,” said Victor Miramontes, who works at the plant. “Some people [are] talking until September.”

“We all get affected by it,” said Clarence Bibbs, a non-union employee. “We’re going to lose production, and we’ll just find other things to do.”

Bibbs blames the American Axle workers for the shutdown.

“There’s an alternative solution, rather than going on strike,” Bibbs said. “Nobody wins when you go on strike.”

American Axle strike causes GM to shut Toledo plant

2nd April 2008
By Staff Writer

General Motors has shut down its Ohio-based Toledo plant, which will be the 30th plant the company has closed following a strike at American Axle & Manufacturing, an automotive parts provider, reported Bloomberg. This is reportedly the second time the company has shut the Toledo plant, which employs around 1,663 people, in a matter of four weeks.

According to General Motors’s (GM’s) website, the 30 plants that have been affected employ a total of 43,911 people, which is almost half of the carmaker’s North American manufacturing workforce.               




GM has already been forced to at least partly idle about 30 North American plants because of parts shortages due to the UAW’s more than seven-week strike at American Axle.

%d bloggers like this: