The Morning ShiftAll your daily car news in one convenient place. Isn’t your time more important? The United Auto Workers’ 46,000 General Motors employees are on strike as contract negotiations continue, and are overshadowed somewhat by a corruption scandal among union leaders. Here’s what you need to know for The Morning Shift of Monday, Sept. 16, 2019.
1st Gear: Why A Strike?
As regular Morning Shift customers are well aware, this fall is when the UAW units are set to renegotiate their contracts with GM, Ford and Fiat Chrysler. GM was first up as workers seek better pay, benefits, paths to seniority for temporary workers and better investments in American factories as the automaker posts strong profits but keeps sending car production to other countries. The union’s contract with GM expired Saturday night. (You can read more about worker demands here.)
The union has said GM has budged little while GM has said otherwise—more on that in a moment—and as such GM’s UAW workers walked off the line at 11:59 p.m. last night. The move shuts down 33 plants in nine states and 22 parts distribution warehouses.
The last time such a move happened was a two-day walkout in 2007. As you read this, bargaining should be underway again.
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Here’s the scene outside some plants from The Detroit News:
Pickets had massed outside the plant and were chanting: “One union” and “Mighty, might union” as more and more workers joined the picket line as rain competed with the union shouts and honking horns.
Ray Atherton from Flushing stood across Van Slyke smiling, watching vehicles exit early Monday, saying it reminded him of the strike in 1998: “This is my third one,” said Atherton, a GM truck driver for 25 years. “In ‘98, we were out for 56 days. I hope it doesn’t go that long.”
About 100 others gathered Monday morning at the Detroit-Hamtramck plant, where UAW members, some representing workers from Detroit’s Big 3, carried signs and sported red UAW shirts. What happens at GM, they said, sets the tone for the rest of them.
“UAW — we’re all a big family,” said Louie Pahl, president of Local 1700 at Fiat Chrysler’s Sterling Heights Assembly Plant. “It doesn’t matter if you’re Ford, GM or Chrysler, Aramark … anything that’s UAW, we’re all brothers and sisters. We’re all from the same family when it comes down to it.”
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The strike is a negotiating tactic to get GM to come back to the table with more concessions to union demands. Here’s more on that from the story above:
[UAW Vice President Terry] Dittes wrote that the union was disappointed that GM waited two hours before the contract expired on Saturday night to make what the union considered “its first serious offer.” If the union received that offer earlier, he added, it may have been possible for the two to reach a tentative agreement and the strike may have been avoided.
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Basically, the UAW doesn’t think GM’s offers to this point have been substantive enough. We’ll see what happens today.
2nd Gear: Lordstown, Hamtramck Could Be Saved
Shortly before the strike and in something of an unusual move, GM outlined its apparent offers to UAW workers. Among them: 5,400 new jobs, investments in eight facilities in four states, improved profit sharing and some better medical benefits. You can read those here.
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One thing I find notable is GM’s reported offer to reopen its “unallocated” Lordstown, Ohio plant, and build an electric pickup truck at the Detroit-Hamtramck plant. That’s from Automotive News:
While most electric vehicles have been compact compliance cars or sporty luxury rides, several electric pickups are in development, including from Ford, Tesla and Rivian. An electric truck would join planned Cadillac models toward the Detroit automaker’s promised 20 new electric vehicles globally by 2023.
Manufacturing battery cells in Lordstown would not affect the potential for a sale to Lordstown Motors, said the person, who asked not to be identified discussing private negotiations. The newly formed company, led by former Workhorse Group Inc. CEO Steve Burns, is working to buy the factory.
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The AP elaborates, saying the Lordstown plant could also make batteries for GM and be used to make EV trucks for Workhorse. If that even happens.
The closure of the Lordstown plant has been a huge flashpoint for GM workers. A maker of “small” cars since the 1960s, it was most recently making the slow-selling Chevrolet Cruze before being shuttered entirely, striking a significant economic blow to a depressed region already short on jobs. More than a few critics have wondered by GM is making the new Chevrolet Blazer crossover, for example, in Mexico instead of Ohio. President Donald Trump has also been pretty livid about it.
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The Detroit-Hamtramck Assembly plant, which makes Chevy and Cadillac sedans, is also slated to close next year. I for one am hoping the UAW prevails on keeping these plants open; that’d be good news for American workers.
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3rd Gear: But Corruption Looms Over All
Negotiations come at a bad time for UAW leadership and they have no one to blame but themselves. Over the past few years the union has been ensnared in a corruption scandal that’s sent several high-ranking officials to prison—first over a “worker training” slush fund at Fiat Chrysler, and now more over further alleged misappropriations of union money. Read our latest on all that here.
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Back to The Detroit News:
The UAW-GM confrontation comes as the federal investigation into UAW corruption is reaching the highest levels of the union, including the indictment of Region 5 Director Vance Pearson that also implicates “UAW Official A” and “UAW Official B.” Citing sources, The Detroit News identified UAW President Gary Jones as “Official A” and his predecessor, Dennis Williams, as “Official B” in a years-long scheme that federal investigators say misused union money.
The union and GM likely will struggle to reach an agreement as long as the “big cloud” of the federal investigation into UAW corruption hangs over the union, said Marick Masters, business professor and former director of labor studies at Wayne State University.
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And from Nick Bunkley at Automotive News, here’s where some of that money was allegedly going:
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A terrible look for the UAW, and a black eye that American labor doesn’t need.
4th Gear: Tensions Between Auto Workers, Salaried Employees, Janitors
But not everyone who works for GM is a union employee, of course. What about the non-union salary workers? Well, as white-collar employees arrived for work at Flint today, GM’s UAW strikers blocked their entry with their own bodies, reports The Detroit Free Press:
A line of mostly pickup trucks and SUVs stretched as far as the eye could see down Bristol Road, wrapping in all directions Monday morning around the Flint Assembly Plant as UAW picketers used their bodies to block GM salaried employees from getting to work.
By 5:45 a.m., a traffic crawl came to a standstill as dozens of UAW GM employees walked with signs at two key entrances just off I-75 — including a back entrance known as David Street used mostly by semi trucks just off the highway. Traffic backed up more than a mile in one direction and halted in two sections of Van Slyke.
At the plant entrances, cars inched through one at a time with long waits in between as drivers of semis, waste haulers and an ambulance passed the scene blaring horns. Teamsters have come out in support of the UAW workers.
Even though production workers are on strike, the factory is the job site for many white-collar employees who still must report to work.
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But it’s worth noting that on Sunday, before the strike happened, UAW-unionized Aramark janitorial workers—who have not had a contract since March 2018—on their own strike witnessed GM workers crossing the picket line to get into the Flint plant. Also from the Freep:
In an emotional scene Sunday morning, UAW autoworkers passed picketing janitors represented by the same union just hours after the maintenance workers went on strike in an escalation of already-tense contract talks.
“This isn’t what solidarity looks like,” one autoworker said as he dropped off food to the janitors before reporting for his shift, which started just before 7 a.m.
The autoworkers are General Motors employees and the UAW told them to report to work Sunday even though the union’s contract with GM expired at 11:59 p.m. Saturday. The union’s leadership was to meet at 10 a.m. Sunday in Detroit to decide on next steps.
The janitors work for Aramark, with which GM contracts for maintenance at five plants in Michigan and Ohio. About 850 UAW-represented Aramark workers sent on strike at midnight.
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Not a great look. But the Teamsters, which do a great deal of freight transport, also announced they’ll be striking against GM in solidarity with the UAW. That’s an even potentially bigger headache for the automaker if it’s unable to ship cars out.
5th Gear: Inventory Fine, Say GM And Dealers
What about the cars, you ask? What about our precious Equinox and Traverse crossovers and the big, beautiful pickup trucks?
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Well, inventory is fine, reports Automotive News. Even with UAW workers on strike and thus not producing or finishing new cars, GM’s dealers should be in okay shape for now:
The automaker has a 77-day supply of new vehicles, according to a report by Cox Automotive, placing it well ahead of the industry average of 61 days. The automaker had a 90-day supply of vehicles as of Aug. 1, according to the Automotive News Data Center.
Both figures are higher than the 66-day supply of vehicles GM had when the union last struck in September of 2007, although that work stoppage lasted less than two full days.
Among GM’s brands, supplies totaled 98 days for Buick, 89 days for Cadillac, 72 days for Chevrolet and 84 days for GMC, according to Cox.
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Thank God.
Reverse: A Fitting Anniversary For Today, I Suppose
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Neutral: What Do You Think Of The Strike?
As I mentioned above, it’s been hard to swallow GM’s closures of American plants as it’s raking in dough. It’s good to see that may change. But what are your thoughts on GM’s first strike in over a decade? And what does it mean for negotiations at Ford and FCA?
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