Union turns to Ford after GM workers approve new contract

Union turns to Ford after GM workers approve new contract
Workers and union representatives react after their contract with General Motors marked the end of the strike. (AP)
Updated 26 October 2019

Union turns to Ford after GM workers approve new contract

Union turns to Ford after GM workers approve new contract
  • Deal includes a mix of wage increases and lump-sum payments and $11,000 signing bonus
  • The United Auto Workers union and Ford, the second-largest US automaker, will begin talks on Monday.

ROMULUS, Michigan: A contentious 40-day strike that crippled General Motors’ US production came to an end as workers approved a new contract with the company.

The four-year deal will now be used as a template in bargaining with crosstown rival Ford Motor Co., the union’s choice for the next round of bargaining, followed by Fiat Chrysler.

Ford said it looks “forward to reaching a fair agreement that helps Ford enhance its competitiveness and preserve and protect good-paying manufacturing jobs.”

The United Auto Workers (UAW) union and Ford, the second-largest US automaker, will begin talks on Monday. Ford and the UAW said earlier this month they had made “significant progress” in addressing many bargaining issues.

GM workers voted 57.2 percent in favor of the pact, passing it with a vote of 23,389 to 17,501, the union said in a statement.

Picket lines came down almost immediately after the vote was announced, and some of the 49,000 striking workers were expected to return to their jobs as early as Friday night. 

Some skilled trades employees such as electricians and machinists planned to enter the plants to get machinery restarted in preparation for production workers to return as early as Saturday.

“It was a good vacation, but I guess I’ve got to go back,” joked Paul Daru, a 42-year worker at GM’s engine and transmission plant in Romulus, Michigan, near Detroit. 

“I miss the socializing and stuff like that, seeing the guys, going out on the job and figuring out what the problem is.”

Although workers at his factory approved the deal, Daru said he voted against it because it still has several different pay scales for workers doing the same jobs. 

“Somebody who is working next to you for 17 bucks per hour, you’re doing the same thing,” said Daru, an electrician who may go back to work.

Temporary workers can get permanent jobs after two or three years depending on their start dates, but they start at the bottom of a pay scale, so people doing the same work can end up at different pay rates.

The deal also includes a mix of wage increases and lump-sum payments and an $11,000 signing bonus. 

But it allows GM to close three US factories, a point of contention for many of the 42.8 percent of workers who voted no.

The five-week walkout was big enough to help push down September US durable goods orders by 1.1 percent, the largest drop in four months.

“We delivered a contract that recognizes our employees for the important contributions they make to the overall success of the company, with a strong wage and benefit package and additional investment and job growth in our US operations,” GM CEO Mary Barra said in a statement.

Tricia Pruitt, another worker in Romulus, said the wage gains were worth staying off the job for more than five weeks, but she’s ready to return to work.

Pruitt, a 15-year GM employee, was happy that the contract brings workers hired after 2007 up to the same wage as older workers in four years.

Although GM dealers had stocked up on vehicles before the strike and many still have decent supplies, analysts say GM will not be able to make up for the lost production. Had the strike been shorter, GM could have increased assembly line speeds and worked the plants on overtime to catch up and refill its stock. 

But many of the plants that make popular SUVs and pickup trucks already were working around the clock to keep up with demand before the strike began.

Also, companies that supply parts to the factories and halted production during the strike will need time to restart, although GM has some parts in stock.

Jeff Schuster, senior vice president of the consulting firm LMC Automotive, estimates that GM has lost production of 300,000 vehicles, and he said maybe only a quarter of it can be made up.

Some production losses will help thin inventory, especially of cars, Schuster said. 

But in late October and early November, GM will likely run short of colors and models of trucks and SUVs that are in high demand until stocks are replenished, he said. 

Although truck and SUV buyers generally are loyal to a brand, customers in a hurry for a new vehicle could go elsewhere, Schuster said.

“There are definitely going to be some limitations on choice, and that is a risk,” Schuster said. 

“Consumers can opt to wait, or they can go down the street to their competitor.”

With bargaining shifting to Ford, it’s not clear whether there will be another strike, but it’s unlikely Ford or Fiat Chrysler will like the terms of the GM contract.

GM traded the ability to close the three factories in Lordstown, Ohio; Warren, Michigan; and near Baltimore for higher labor costs, David Kudla, chief investment strategist for Mainstay Capital Management of Grand Blanc, Michigan, wrote in a note to investors. The contract maintains worker health benefits with low premiums, something that both Ford and FCA wanted to change when negotiations began.

“Ford and FCA didn’t have three factories that they wanted to close, but will have to work around this new framework for higher wages and unchanged health care that the UAW and GM have set,” wrote Kudla.

Workers from the closed factories campaigned against the contract, with several plants voting against it. 

But in the end, economic gains and a $7.7 billion GM investment pledge for US factories were too much to turn down.

Tim O’Hara, president of the UAW local in Lordstown, said workers there overwhelmingly voted down the deal, disappointed that they did not get a new vehicle to keep the plant open. 

Many Lordstown workers were transferred to other factories, and they campaigned against the contract at their new jobs, he said.

Thousands of ex-Lordstown workers were hoping they could someday return to their homes, he said. 

“A lot of our people did have plans that they could come back in possibly a year or even three years,” O’Hara said. 

“Now that’s gone. They have to draw up a whole new game plan.”


Oil prices rise further on tight supply outlook, eyes on OPEC+

Oil prices rise further on tight supply outlook, eyes on OPEC+
Updated 49 sec ago

Oil prices rise further on tight supply outlook, eyes on OPEC+

Oil prices rise further on tight supply outlook, eyes on OPEC+
SINGAPORE: Oil prices climbed for a third straight session on Friday, on track for a fifth consecutive weekly gain, as demand growth is expected to outstrip supply on bets that OPEC+ producers will be cautious in returning more output to the market from August.
Brent crude futures rose 6 cents, or 0.1 percent, to $75.62 a barrel at 6:46 a.m. GMT, heading for a 2.9 percent jump for the week.
US West Texas Intermediate (WTI) crude futures were up 5 cents, or 0.1 percent, at $73.35 a barrel, headed for a 2.4 percent weekly gain.
Both benchmark contracts settled at their highest levels since October 2018 on Thursday.
“Expectations of tightness in global market is the major factor supporting crude oil as demand is recovering while OPEC+ has constrained supply and US stocks are falling,” said Ravindra Rao, vice president for commodities at Kotak Securities.
Oil also got some support on Friday as the approval of US infrastructure bill boosted optimism for energy demand outlook, analysts said.
All eyes are on the Organization of the Petroleum Exporting Countries, Russia and allies — together called OPEC+ — who are due to meet on July 1 to discuss further easing of their output cuts from August.
“(The market) certainly has momentum behind it...It’s really in the hands of OPEC+,” said Commonwealth Bank commodities analyst Vivek Dhar.
On the demand side, the key factors OPEC+ will have to consider are strong growth in the United States, Europe and China, bolstered by vaccine rollouts and economies reopening, offset by rising COVID-19 cases and outbreaks in other locations, analysts said.
“I think OPEC+ will carefully calibrate production hikes from August onwards to meet rising demand without causing significant price fluctuations,” said Margaret Yang, a strategist at Singapore-based DailyFX.
“The market has likely priced-in an August hike in advance,” she added.
ANZ analysts have predicted OPEC+ would step up supply with a small increase of 500,000 barrels per day in August, adding to the 2.1 million bpd they agreed to return to the market from May through July.
The prospect of sanctions being lifted on Iran and more of its oil hitting the market anytime soon has dimmed, with a US official saying “serious differences” remain over a range of issues over Iran’s compliance with the 2015 nuclear deal.

Iraq, UAE’s Masdar sign solar power agreement

Iraq, UAE’s Masdar sign solar power agreement
Updated 14 min 11 sec ago

Iraq, UAE’s Masdar sign solar power agreement

Iraq, UAE’s Masdar sign solar power agreement
  • 2,000 MW of solar to be built according to agreement
  • Cost of deal undisclosed by Iraqi Oil Ministry

DUBAI: The Iraqi electricity ministry signed with Masdar, a United Arab Emirates-based renewable power developer, an agreement to build solar power projects in central and southern Iraq, with a total capacity of 2,000 Megawatts, the Iraqi oil ministry said on Thursday in a statement.
The project is the biggest investment in Iraq’s renewable energy industry, the statement said, without indicating its total cost.
Iraq is planning to build a number of power plants in the coming years in partnership with international and Arab companies. Some will use solar energy, while others will run on fossil fuels, including gas that is produced during the extraction of oil, by introducing it into the electricity production system, Iraq Oil Minister Ihsan Abdul Jabbar told Asharq recently.


Lebanon caretaker PM approves financing fuel imports at weaker exchange rate

Lebanon caretaker PM approves financing fuel imports at weaker exchange rate
Updated 32 min 49 sec ago

Lebanon caretaker PM approves financing fuel imports at weaker exchange rate

Lebanon caretaker PM approves financing fuel imports at weaker exchange rate
  • Lebanon is in the throes of a financial crisis described by the World Bank as one of the deepest depressions of modern history
  • Lebanon’s central bank asked the government on Thursday to provide it with a legal basis to lend it foreign currency from its mandatory reserves to fund the subsidised fuel imports

BEIRUT: Lebanon’s caretaker prime minister on Friday approved a proposal to finance fuel imports at the rate of 3,900 Lebanese pounds to the dollar, instead of the previous 1,500 pound rate, amidst worsening gasoline shortages.
The weaker exchange rate, which will effectively decrease the subsidy on fuel, is expected to raise the price of gasoline for consumers but enable the government to supply fuel for a longer period of time.
Lebanon is in the throes of a financial crisis described by the World Bank as one of the deepest depressions of modern history. Fuel shortages in past weeks have forced motorists to queue for hours for dribbles of gasoline.
Lebanon’s subsidy program, introduced last year as the country’s economic meltdown translated to harsher living conditions, covers basic goods such as wheat, medicine and fuel and costs around $6 billion a year.
Half of that amount is spent on fuel.
Lebanon’s central bank asked the government on Thursday to provide it with a legal basis to lend it foreign currency from its mandatory reserves to fund the subsidised fuel imports, an indication that the bank has all but run out of reserves.
Mandatory reserves — hard currency deposits parked by local lenders at the central bank — represent a percentage of customer deposits and are usually not drawn upon except in exceptional circumstances, with the correct legal permission.
Lebanon’s foreign currency reserves stood at slightly more than $15 billion in March. The Central Bank has not given an updated figure since then. 


Iraq targets 90% self-sufficiency in natural gas by 2025

Iraq targets 90% self-sufficiency in natural gas by 2025
Updated 25 June 2021

Iraq targets 90% self-sufficiency in natural gas by 2025

Iraq targets 90% self-sufficiency in natural gas by 2025
  • Iraq currently consumers 3,5000 cubic feet of gas, produces 1,300 cubic feet
  • Iraq imports the rest of its gas from Iran

RIYADH: The Iraqi Ministry of Oil plans to attract a contractor to invest in Akkas gas field, to produce 4,000 million cubic feet of gas by 2025, which represents 90 percent of Iraq’s need for electric power production, said Minister Ihsan Abdul Jabbar.

Iraq will need more gas for electric power by 2030 to keep pace with the rise in the population, which is expected to increase by 10 million people to 50 million by then, he told Asharq.

Iraq will still need to import 15 percent of the gas fuel it needs, he said. Infrastructure is being built in the south to open new outlets to import gas from other countries such as Qatar when needed, he said.

There are currently new projects in the governorates of Dhi Qar and Maysan, Abdul Jabbar said.

Iraq currently consumes about 3,500 million standard cubic feet of natural gas, of which 1,300 cubic feet is produced in Iraq and the rest imported from Iran, while the actual need for Iraq amounts to 4,500 million cubic feet, he said.

Iraq is planning to build a number of power plants in the coming years in partnership with international and Arab companies. Some will use solar energy, while others will run on fossil fuels, including gas that is produced during the extraction of oil, by introducing it into the electricity production system, Abdul Jabbar said.

Iraq plans to end gas flaring altogether by 2025, he said.


UAE may become first major oil exporter to target net zero by 2050

UAE may become first major oil exporter to target net zero by 2050
Updated 25 June 2021

UAE may become first major oil exporter to target net zero by 2050

UAE may become first major oil exporter to target net zero by 2050
  • UAE can hit target while continuing to sell oil and gas
  • UAE may announce plan before Glasgow climate summit

ABU DHABI: The UAE is considering a 2050 target to align with a global push to keep temperatures from rising more than 1.5 degrees Celsius from pre-industrial levels, Bloomberg reported citing people familiar with the matter.

If the discussions succeed, the UAE could become the first among OPEC countries to technically reach net zero while continuing with plans to invest billions in oil extraction.

This move would please Western countries pushing for stronger climate commitments but won’t require it to sell less oil.

The net-zero charge is being led by Sultan Ahmed Al Jaber, the UAE’s special envoy for climate change and its minister of industry and advanced technology.

We are “certainly working on a whole-of-government approach to see at what point it would be feasible to achieve net zero,” Hana AlHashimi, who heads Al Jaber’s office, said on a call hosted by the US-UAE Business Council on Wednesday, according to Bloomberg. “I’d encourage you to stay tuned,” she said.

The country aims to make an announcement before the UN climate summit in Glasgow in November, the people said, asking not to be identified for the privacy of the ongoing talks.

Emissions from burning fossil fuels after they’re shipped abroad aren’t included in such country-level targets. The fossil fuels remain UAE’s biggest source of revenue, contributing about 30 percent to GDP. Still, the nation has taken steps to bolster its green credentials.

Only half of all power capacity is set to be emission free by 2050, consisting of renewables and nuclear, according to the UAE’s long-term energy plan. The country plans to meet the rest of its energy needs with gas and coal.

Climate Action Tracker, a nonprofit that analyzes climate goals, rates the UAE’s policies “highly insufficient.”

The UAE is now bidding to host the UN’s global climate talks in 2023. It’s up against South Korea, which has already set a net-zero by 2050 goal.

The UAE has been a target of US lobbying for stronger green commitments. It’s among the few countries to host special climate envoy John Kerry twice since he took office earlier this year, Bloomberg said.

Kerry expressed optimism that Saudi Arabia will agree to a net-zero emissions target of around 2050 after visiting the nation on his most recent trip to the region.