Email
Password
Remember meForgot password?
    Log in with Twitter

article imageGM-UAW talks going nowhere fast as GM loses $80 million a day

By Karen Graham     Oct 7, 2019 in Business
As the General Motors strike enters its fourth week, a union leader says negotiations “have taken a turn for the worse”—creating the potential for more serious financial pain for the company.
Contract talks have hit another big snag over product commitments for U.S. factories, a union official wrote in an email to members on Sunday, according to the Associated Press. And this one issue has turned into a hot item in the talks.
Usually, in contract talks, the union bargains for commitments from GM to build new vehicles, engines, transmissions, and other items at U.S. factories represented by the union.
However, an unnamed person who allegedly has been briefed on the talks said Sunday that the union voiced concerns about GM increasing production in Mexico, where it now builds pickup trucks, small cars, and two SUVs.
The person, who spoke on condition of anonymity because the talks are private, said both sides are far apart on guarantees of new products in U.S. factories.
So, even though GM wrote in a letter Sunday, “We continue to negotiate in good faith with very good proposals that benefit employees today and builds a stronger future for all of us," it looks like there is not going to be a resolution to the stalled talks anytime in the near future.
Anderson Economic Group estimated GM’s cumulative lost profits would total $660 million through Sunday, reports Barron's. Patrick Anderson, CEO at the Michigan consulting firm, added that “as predicted, daily losses started off slow at under $10 Million per day.”
However, with the strike moving into its fourth week, those losses could end up spiraling to $90 million a day, Anderson said. Kristin Dziczek, vice president of industry, labor, and economics at the Center for Automotive Research, recently told analysts at UBS that the most likely resolution could come in late October.
In related news, today, General Motors said it is temporarily laying off another 415 workers in Mexico as a strike by 48,000 U.S. hourly workers enters its fourth week, reports Reuters.
GM's move has partially idled the Ramos Arizpe propulsion plant, with the V8 engine line and the CVT transmission line not operating. The plant continues to build engines for the Ramos assembly plant, which is still operating.
GM is losing more than $80 million a day as the strike continues, according to industry analysts. Workers earn $250 per week in strike pay while they’re on the picket lines, about one-fifth of what they normally make.
More about GMUAW talks, US factories, Mexico, wages and pensions, cut labor costs
 
Latest News
Top News