Striking Pad
Gm and Uaw Waiting for Strike Deadline
General Motors — as the target for the strike that the United Auto Workers union had been preparing said that both parties are going to agree on a new contract. For automotive analysts, a short term walk-out will not be a severe financial burden to the company but will eventually affect the launching of some significant vehicles next year.
“We are fully committed to working with the UAW to develop solutions together to address the competitive challenges facing General Motors,” said Dan Flores, GM spokesman.
“We remain focused on reaching a tentative agreement as soon as possible.” he added in his statement.
Some union officials confirmed that they are waiting for a call from Detroit at about 10 p.m. EDT to whether go on with the strike or stay in their respective jobs.
Recently, the UAW had chosen GM as the lead company of the three Detroit-based automakers. The union will negotiate with the lead company in behalf of the other two. With what GM and the UAW have agreed into, Ford and Chrysler LLC will be pressed to accept the same terms. The two other companies have already extended their contracts with the UAW indefinitely. Negotiations are still going on and the contract extension can be canceled with three days prior notice.
If properly decided by its officials and members, UAW can strike GM after the midnight deadline. Another option would be that both parties can still negotiate and use the terms of the old contract to cover the workers. According to Jim Graham, UAW Local 1112 president in Lordstown Ohio, his local union was only waiting for a go-signal form the union to strike at Friday midnight.
“We are already set. Everything’s in motion,” Graham said.
According to Ward’s AutoInfoBank, presently, GM has a 65-day supply of vehicles by the end of August compared to the 67-day supply average for the U.S. based auto manufacturers. For Paul Taylor, the chief economist for the National Automobile Dealers Association, a 60-day supply is already ideal, however, with GM’s supply, it is an indication that it is not prepared for a strike.
“I see some posturing to let them know a strike is still a tool that can be used, but it’s like bleeding both patients in the negotiations with leeches,” Taylor said. “It would bleed both sides to death.”
GM was doing really good in controlling its inventory this year said Catherine Madden, an auto manufacturing analyst in Global Insight. For her, a strike would definitely damage the production and sales of the 2008 vehicles significantly GM’s Chevrolet Malibu sedan.
“We’re forecasting a very bleak year for 2008, with no growth,” she said. “A strike could push things in deeper and exacerbate what’s already going to be a difficult year.”
American based automakers are facing a really serious labor problem. No reports had been made that its closest Global competitors, the Japanese auto manufacturers like Toyota, Honda (produces cars with original Honda brake pad) and Suzuki are facing a similar fiasco.
About the Author
Anthony Fontanelle is a 35-year-old automotive buff who grew up in the Windy City. He does freelance work for an automotive magazine when he is not busy customizing cars in his shop.
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