UAW calls first national strike against GM since 2007

UAW Presdient Gary Jones speaks during talks with General Motors in Detroit. (AP)
Updated 16 September 2019

UAW calls first national strike against GM since 2007

DETROIT: The United Auto Workers (UAW) said on Sunday that its roughly 48,000 hourly workers at General Motors Co. facilities would go on strike after US labor contract talks reached an impasse, the first nationwide strike at GM in 12 years.

“We do not take this lightly,” Terry Dittes, the UAW vice president in charge of the union’s relationship with GM, said at a press conference in downtown Detroit. “This is our last resort.”

GM said in a statement that its offer to the UAW during talks included more than $7 billion in new investments, 5,400 jobs — a majority of which would be new — pay increases, improved benefits and a contract ratification bonus of $8,000.

“We have negotiated in good faith and with a sense of urgency,” the automaker said.

A strike will very quickly shut down GM’s operations across North America and could hurt the broader US economy. 

A prolonged industrial action would also cause hardship for GM hourly workers on greatly reduced strike pay.

GM’s workers last went out on a brief two-day strike in 2007 during contract talks. A more painful strike occurred in Flint, Michigan, in 1998, lasting 54 days and costing the No. 1 US automaker more than $2 billion.

As of Sunday, talks between GM and the UAW had been suspended, according to people familiar with the matter.

The union has been fighting to stop GM from closing auto assembly plants in Ohio and Michigan and arguing workers deserve higher pay after years of record profits for GM in North America. GM argues the plant shutdowns are necessary responses to market shifts, and that UAW wages and benefits are expensive compared with competing non-union auto plants in southern US states. 

In its statement, the automaker said its offer to the union included solutions for the Michigan and Ohio assembly plants currently lacking products.

A person familiar with GM’s offer said that could include producing a future electric vehicle in Detroit.

It could also include turning a plant in Lordstown, Ohio, into an electric vehicle battery plant or going through with the proposed sale of the plant to a group affiliated with electric vehicle start-up Workhorse Group Inc.

A new battery plant could give some UAW workers at Lordstown the chance to remain with GM.

The closure of Lordstown drew widespread criticism, including from US President Donald Trump. Ohio is crucial to Trump’s re-election bid in 2020.

The union has framed the plant closures as a betrayal of workers who made concessions in 2009 to help GM through its government-led bankruptcy.

“General Motors needs to understand that we stood up for GM when they needed us,” Ted Krumm, head of the union’s bargaining committee in talks with GM, said at the press conference Sunday. These are profitable times ... and we deserve a fair contract.”

The UAW says significant differences remain between both sides over wages, health care benefits, temporary employees, job security and profit sharing.

The strike will test both the union and GM Chief Executive Mary Barra at a time when the US auto industry is facing slowing sales and rising costs for launching electric vehicles and curbing emissions.

Kristin Dziczek, vice president of industry, labor and economics at the Ann Arbor, Michigan-based Center for Automotive Research (CAR), said the strike at GM’s US facilities will also shut its plants in Canada and Mexico as the automaker’s supply chain is so integrated.


Lufthansa accepts tweaked demands by Brussels over state bailout

Updated 30 May 2020

Lufthansa accepts tweaked demands by Brussels over state bailout

  • Lufthansa and the rest of the airline sector have been hard hit by what is expected to be a protracted travel slump

BERLIN/FRANKFURT: Lufthansa’s management board has accepted a more favorable set of demands from the European Commission in exchange for approval of a $10 billion government bailout, the carrier said on Saturday, paving the way for its rescue.
The agreement comes after the airline’s supervisory board on Wednesday rejected an initial deal with Brussels including conditions that were significantly more painful.
Lufthansa and the rest of the airline sector have been hard hit by what is expected to be a protracted travel slump due to the coronavirus pandemic.
Under the latest agreement, Lufthansa said it will be obliged to transfer up to 24 takeoff and landing slots for up to four aircraft to one rival each at the Frankfurt and Munich airports.
This translates into three take-off and three landing rights per aircraft and day, it said, confirming what sources had earlier told Reuters.
“For one-and-a-half years, this option is only available to new competitors at the Frankfurt and Munich airports,” Lufthansa said, initially excluding budget carrier Ryanair. “If no new competitor makes use of this option, it will be extended to existing competitors at the respective airports.”
The previous deal had included forfeiting 72 slots used by 12 of 300 jets based at the Frankfurt and Munich airports, a source familiar with the matter said.
The slots, to be allocated in a bidding process, can be taken over only by a European peer that has not received any substantial state aid during the pandemic, Lufthansa said.
The Commission said once it has been officially notified by Germany on the aid package it will assess the issue as a matter of priority.
“(Lufthansa’s remedies will) enable a viable entry or expansion of activities by other airlines at these airports to the benefit of consumers and effective competition,” it said in a statement.
The airline’s supervisory board needs to approve the deal, Lufthansa said, adding it would convene an extraordinary general meeting to obtain shareholder approval for the bailout.
The largest German corporate rescue since the coronavirus crisis struck will see the government get a 20 percent stake in Lufthansa, which could rise to 25 percent plus one share in the event of a takeover attempt. A deal would also give the government two seats on Lufthansa’s supervisory board.
Rivals such as Franco-Dutch group Air France-KLM and US carriers American Airlines, United Airlines and Delta Air Lines are all seeking state aid due to the economic effects of the pandemic.
Germany, which has set up a $110 billion fund to take stakes in companies hit by the pandemic, said it plans to sell the Lufthansa stake by the end of 2023.
“The German government, Lufthansa and the European Commission have reached an important intermediate step in the aid negotiations,” the Economy Ministry said in a statement.
It said talks with the Commission over state aid would continue.