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Autoworkers Union Calls for Strike Against G.M. Autoworkers Union Calls for Strike Against G.M.
(about 4 hours later)
The United Automobile Workers said Sunday that it planned to go on strike at General Motors at midnight after the two sides could not reach an agreement on a new labor contract. With the two sides still far apart on most of the major issues in negotiations for a new labor contract, the United Automobile Workers union said on Sunday that it would go on strike at General Motors.
The current bargaining agreement expired at midnight on Saturday, with the union and company far apart on most of the major issues on the table. U.A.W. regional leaders in Detroit voted unanimously on Sunday morning to authorize the strike, set to begin at midnight, after the union’s current bargaining agreement expired on Saturday. And now nearly 50,000 U.A.W. employees at General Motors plants across the country are set to walk off the job, barring a breakthrough in the talks, in the first such strike since 2007.
The U.A.W. is pushing G.M. to improve wages, reopen idled plants and add jobs at others. G.M. wants workers to share a greater portion of their health care costs. Although the company has been earning substantial profits in North America, it has idled four plants in the United States amid a softening of overall demand and a steep drop in sales of cars. “Today, we stand strong and say with one voice, we are standing up for our members and for the fundamental rights of working-class people in this nation,” Terry Dittes, a union vice president, said after the meeting.
The strike plan was authorized on Sunday morning by a unanimous vote at a meeting of U.A.W. regional leaders in Detroit. The U.A.W. is pushing G.M. to improve wages, reopen idled plants, add jobs at others and close or narrow the difference between pay rates for new hires and veteran workers. G.M. wants employees to share a greater portion of their health care costs, and to increase work-force productivity and flexibility in factories. Although the company has been earning substantial profits in North America, it has idled four plants in the United States as car sales slide and overall demand weakens.
“Today, we stand strong and say with one voice, we are standing up for our members and for the fundamental strike of working class people in this nation,” Terry Dittes, a union vice president, said after the meeting. At the same time as the talks, a federal corruption inquiry has been looking into union officials and at least two Fiat Chrysler executives. The investigation has detailed the use of union funds for lavish travel and personal spending by senior U.A.W. officials, including the president, Gary Jones.
In a statement, G.M. said it has offered to make more than $7 billion in investments in plants in the United States, add 5,400 jobs and increase pay and benefits. It is a challenging time for the industry over all, with auto sales slowing in the United States, China and other major markets, and new technologies such as electric cars and self-driving vehicles requiring billions of dollars in investments.
“We presented a strong offer that improves wages, benefits and grows U.S. jobs in substantive ways, and it is disappointing that the U.A.W. leadership has chosen to strike at midnight tonight,” the company said. “We have negotiated in good faith and with a sense of urgency. Our goal remains to build a strong future for our employees and our business.” “Carmakers’ profits today distract from two challenges,” said Erik Gordon, a University of Michigan business professor who follows the auto industry. “The makers will be going into a down cycle of demand in their two most important markets and they will have to make the biggest technology investments in their history to change to electric propulsion.”
Among its goals, the union is hoping to get G.M. to reopen an idled car factory in Lordstown, Ohio, a goal that President Trump has supported. The plant had made the Chevrolet Cruze, a compact car whose sales plunged nearly 40 percent between 2015, when the previous labor contract was signed, and 2018. The factory ceased production in March.
In a statement, G.M. said it had offered to make more than $7 billion in new investments in plants in the United States, add 5,400 jobs and increase pay and benefits.
“We presented a strong offer that improves wages, benefits and grows U.S. jobs in substantive ways, and it is disappointing that the U.A.W. leadership has chosen to strike at midnight tonight,” the company said on Sunday. “We have negotiated in good faith and with a sense of urgency. Our goal remains to build a strong future for our employees and our business.”
It could take G.M. some time to feel the impact of any strike. The company has enough inventory on dealer lots to last 77 days at the current rate of sales, according to Cox Automotive.
The union did not resort to nationwide strikes against G.M. when it negotiated contracts in 2011 and 2015. Its members walked out of G.M. plants for three days in 2007 before a deal was reached.
G.M. employs 49,000 full-time and temporary U.A.W. members, fewer than the numbers employed at Ford Motor and Fiat Chrysler. G.M. has a smaller U.A.W. work force than its rivals because larger portions of the vehicles it makes in North America are assembled in Mexico and Canada.
While the prospect of a strike has at least temporarily taken the spotlight off the union’s legal troubles, the scandal has made members suspicious of the U.A.W. leadership, said Paul Wohlfarth, a retired U.A.W. member from Toledo who is still active in the union.
“It seemed like a few bad apples at first, but it’s not,” he said. “It’s a whole bushel.”
Since 2017, nine people have been charged in connection with a variety of schemes in which union money was allegedly used for extravagant personal spending. In one case, Fiat Chrysler’s top labor executive bought a Ferrari sports car and renovated his home using funds earmarked for a training center run by the union and the automaker.
Late last month, federal agents raided Mr. Jones’s home in Canton, Mich.; a Hazelwood, Mo., regional office that Mr. Jones previously headed; the union’s Black Lake retreat in Onaway, Mich.; and the Corona, Calif., home of Mr. Jones’s predecessor, Dennis Williams.
On Thursday, Vance Pearson, a senior union official who worked closely with Mr. Jones, was charged with embezzlement, money laundering, wire fraud, conspiracy and other offenses. The prosecutor’s complaint said Mr. Pearson and other senior U.A.W. officials spent union funds on luxury villas in Palm Springs, Calif., golf clubs, clothing, expensive champagne, liquors and cigars.
According to the complaint, Mr. Pearson and others funneled the expenses through a Palm Springs resort to conceal the nature of the charges. Mr. Pearson had acted in coordination, prosecutors said, with four individuals who were identified in the complaint as U.A.W. Official A, B, C and D.
Mr. Pearson took part in union meetings and the strike vote on Sunday, a union spokesman confirmed.