UAW and GM negotiators seek deal as strike starts third week
Negotiators for the United Auto Workers union and General Motors were due back at the negotiating table Monday after talks throughout the weekend failed to reach a deal to end one of the longest auto strike in decades.
Talks went into the evening once again on Sunday, according to a person familiar with the negotiations, as the two sides seek an agreement on major issues of pay, profit sharing, job security and GM’s use of temporary workers.
The strike has been the largest against any business in the United States since 2007, when GM automakers walked off the job for three days. With the strike beginning its third week on Monday, this is the longest work stoppage at GM since 1998, when a 67-day strike at two plants in Flint, Michigan, eventually halted production at 30 other GM factories across the United States.
Once a tentative deal is reached, union negotiators will need the approval of the rank-and-file members at GM before it can go into effect. Rejection of a tentative deal is not unheard of, with workers at Fiat Chrysler rejecting a deal reached four year ago before approving a second version.
It is not clear if the union will have the workers return to work during the ratification process or wait for it to be ratified.
The strike started at 12:01 a.m. on Monday, September 16, halting work at 31 GM factories and 21 other facilities spread across nine states, mostly in the center of the country. It also led to layoffs at some of the 10,000 American suppliers that provide auto parts and other goods and services to GM. That may have furloughed as many as 200,000 additional workers at those companies, according to estimates.
Signs of progress in the talks emerged late last week, according to people familiar with the matter.
The union’s chief negotiator told members late Wednesday that all the talks had moved to the main table of negotiations, away from the committees that met to work on specific issues, such as contract details applying to one plant or another. And on Thursday GM agreed to restore health care coverage for the strikers at company expense, which was seen as a further sign of progress.
The strike has been costly for both sides. Those on the picket lines had been getting only $250 a week in strike benefits, starting this past Monday on the 8th day of the walkout. That’s far below the more than $30 an hour that most of the veteran workers had been earning.
That amounts to lost wages of about $18 million a day for the striking GM employees, according to an estimate from Anderson Economic Group, a Michigan research firm concentrating on the auto industry. The strike has cost GM about $25 million a day in lost profits, according to Anderson.
GM had built up the inventory of cars it had available before the strike so as to limit lost sales. Still, credit rating agency Moody’s had estimated that once the strike went more than one or two weeks the chances of it having a material impact on its finances increased. GM’s credit rating is only one step above junk bond status and any downgrade into junk bond status would risk raising its cost of borrow.