GM and UAW workers on strike are preparing for a long battle

Both United Auto Workers and General Motors are preparing for the strike to take a long time, Ohio workers in Lordstown want a car to make, Europe's carmakers continue to freak over a Brexit without a deal and more on The Morning Shift of Monday, Sept. 23 2019.

1st Gear: Who Backs Down First?

There's a lot to be said about the ongoing GM strike, so I'll try to pick some important bits, but the important thing is this: it may take some time, and both sides are getting ready for that result.

Last time GM's workers went on strike, it was 2007, and the action lasted only two days in September. Although a global recession slowed and GM's bankruptcy was less than two years away, if you ask workers at the fence just now as the strike kicks in on the seventh day, this time is far more serious.

After all, GM is a very profitable company these days. But it is one that continues to close US factories and shipbuilding sites to other countries as it gives way to a possible economic downturn in the short term, and a massively uncertain transformation of the entire automotive industry in the long term. So for the striking workers, this is about securing their present as well as their future.

Health care costs are one of the key sticking points. UAW workers pay far less in individual contributions to health plans than most Americans do, and GM wants to see it go up, but workers say the dangerous nature of their job makes their current plan a necessity. Via CNBC:

After a dozen years as a car worker, Hall said the generous health benefits the companies provide to UAW employees, which cost workers only 3% of their pockets, is a necessity.

“I have carpal tunnel, heel spurs and I have been on physical therapy for the shoulder and knees. I'm only 41, ”she said. "That's why we need health care to be in the company. … The repetitive wear and tear on your body is horrible."

On Tuesday night, UAW posted a video on social media describing workers' need for low-cost health care that included several members who explained why they felt their health care system should remain unchanged.

"You will be hard pressed to find a long-time GM worker who does not live on a daily basis with permanent injury as a result of the job," said Denny Ramos, a striking GM works in Lansing, Michigan, in the video.

Meanwhile, both sides are digging in for a long battle, with most analysts saying it will take several weeks for GM to feel the sting financially, but workers live on $ 250 in UAW covers the latter now, unexpectedly, which is not good news from the strike fund. Via Automotive News:

Most Forecasters and Wall Street Analogs Experts agree that it will take several weeks, if not months, to really make GM's main line, even though the company loses an estimated $ 50 to $ 100 million each day production goes idle. Inventory levels, well above the industry average, may keep dealer lots full for the foreseeable future, but some dealers have expressed concern that parts shortages could soon destroy their service departments.

Meanwhile, some GM suppliers, including Nexteer Automotive, warned that temporary layoffs were expected soon.

GM's tactical decision to abruptly kick off about 46,000 workers per hour of their normal health coverage, even though it gave negative headlines, put pressure on the union. And while the work stoppage has provided employees with a release valve to long-standing complaints about wages, health care and job security, many expressed concern that the reality of living on a fraction of their normal wages settled in.

2nd Gear: This Moment Is Political Too [19659006] Michigan was crucial to President Donald Trump's 2016 election, at least in part because Hillary Clinton blew it so hard in that state. But this time the Democrats are out in power to support striking workers. Massachusetts

Sen. Elizabeth Warren was at Detroit-Hamtramck this weekend, Minnesota. Amy Klobuchar was there last week and Vermont Senator Bernie Sanders is waiting there this week. In addition, former Vice President Joe Biden was at the Fairfax Assembly in Kansas City to march with valet workers.

Here is the Detroit News & # 39; story of Warren:

Warren joined the gathering outside the facility located on the border of Detroit and Hamtramck. about 12:30 pm She immediately left the SUV and took a sign to march with the crowd dressed in red and T-shirts saying "I'm a Warren Democrat" and "Warren has a plan for it."

Warren during his visit condemned GM for having built product in countries like Mexico with cheaper labor. She credited unions for creating the middle class and said they would also rebuild it.

"The workers in the UAW are here to say no," she said. "They want contracts here that hold these jobs in America. They want a fair salary. They want benefits. They want what it takes to be part of America's middle class. And they want the same for themselves and for laborers. Everyone deserves a living wage in this country. When unions win, all American workers win. "

Trump, who campaigned vigorously to bring production jobs back to America, has so far only expressed a desire for a swift resolution

He has been sharply critical of GM's production move in recent years, but as the AP notes here, labor is still an overwhelmingly democratic domain, which puts him and the rest of the GOP in a strange place:

To support the union would undermine Trump's message that labor does not favor its workers and give a powerful democratic force a boost before an election.

Asking GM would question his promises of to defend workers, and he will risk being blamed for financial suffering in the Rust Belt says he needs to win re-election.

His task gets tougher the longer the strike lasts.

"There is a history of this problem being treacherous in Michigan," said Michigan State University scientist Matt Grossmann. He noted that Republican Mitt Romney's presidential campaign suffered in 2012 when Democrats repeatedly pointed to an opinion piece he wrote against the auto rescue The headline: "Let Detroit Go Bankrupt."

"It's treacherous to be against auto workers," Grossmann said.

[…] Michigan-based Republican strategist John Sellek said he thinks Trump is on the worker's side, but trying to "tread the needle" and not "blow up" GM's offer to save a plant or two.

"It suits his election victory path, and it suits his political positions on trade," he said. "He's going a more cautious way rhetorically for now. But if he decides on a given day that it's time to jump in with both feet, we shouldn't be surprised that he does."

3. : Lordstown Workers Say Battery Plant Is Not Enough

One of the biggest flashpoints in this strike is GM's now-closed Lordstown plant in Ohio, the first to make the Chevrolet Cruze, but after being "unassigned" it waited for a deal was to be sold to start up an electric truck – although that would probably mean fewer jobs and certainly not the same level of pay as before.

Now GM is talking about turning it into a battery plant instead as negotiations continue, but for car workers one thing is clear – the only way forward is whether they get a car made. Via Reuters:

As part of the contract talks with the UAW, GM has suggested that the Lordstown plant be turned into an electric vehicle (EV) b Separately it is said that it is also negotiating to sell the plant to a group affiliated with EV startup Workhorse Group Inc (WKHS.O). Workhorse refused to comment.

In Washington in June, GM Chief of Defense defended the Mary Barra Workhorse Plan. She also told Reuters that GM had no plans to build a new vehicle in Lordstown.

Lordstown workers say it is the only way there will be enough well-paid production jobs for the community. They – and UAW – blame the GM entirely.

"You did everything GM ever asked for, and it still wasn't enough," UAW Local 1112 President Tim O & # 39; Hara told 100 cheering workers during a meeting outside the facility on Friday. "We're going to keep the line for as long as it takes."

But experts say it's unlikely:

The reality is that GM needs to cut down underutilized US production capacity even at current levels, said Sam Fiorani, a vice president with Auto Forecast Solutions.

"There is no chance that GM will put a product back in that plant," he said. "They have too much capacity as it is."

(GM posted $ 8.1 billion profit in 2018.)

Fourth Gives: Car Companies Play & # 39; Wait And See & # 39; On Emissions Rules

Bloomberg notes that in 2009 when President Obama announced tougher fuel economy rules, "he stood shoulder to shoulder in the White House Rose Garden with top executives for the largest car manufacturers." Now that his successor is working to roll back these standards, they are much less visible.

From history:

Instead of managing directors, the automotive industry's lone envoy was a trade union who, after the event, said the group neither opposed nor supported the plan yet.

contrasting scenes highlight the awkward position that automakers have found in President Donald Trump's Washington. The industry aggressively lobbied him to ease the Obama rules, but the plan proposed in August 2018 went beyond what most automakers actually sought.

"This is exactly what we were trying to avoid, this uncertainty happening now," Gloria Bergquist, spokeswoman for the Alliance of Automobile Manufacturers, said on the sidelines of the event Thursday. "We will have to look at what the final rule is and look at the whole package and then decide what our position will be, and different companies may fall in different places."

That uncertainty already comes unstable time for the industry. Carmakers are under pressure from investors to pull billions into forward-looking technologies including electric and autonomous vehicles.

And although fuel economy rules are being rolled back to before Obama levels, don't expect an immediate difference in your new cars, given long product planning cycles. Try around 2025.

If the Trump administration rules on all fronts – weakening national standards and stripping California's power to set its own – it won't necessarily be a clear victory for the industry. The unlocked product plans and subcontracts have already improved fuel efficiency that is baked in, for both gasoline and electricity vehicles.

"If the standards are weakened, the suppliers that work with these technologies – whether internal – internal combustion engine or electric vehicle – will find volumes reduced, so there is a risk to the suppliers," said Alan Baum, an independent car analyst at West Bloomfield, Michigan.

5th Gear: Europe Freaks Out

More companies than just BMW's Mini Division and Jaguar Land Rover are wondering about a potential no-deal Brexit, which is big in October. 19659010] In a statement, groups including European Automobile Manufacturers & # 39; Association, European Association of Automotive Suppliers and 17 national groups warned about the impact of the "no-deal" on an industry employing 13.8 million people in the European Union including the United Kingdom , or 6.1% of the workforce.

“Britain's departure from the EU without a deal would trigger a seismic shift in trade conditions, with billions of euro tariffs threatening with influencing consumer choice and affordability on both sides of the channel, "they wrote in Monday's statement.

"Completion of barrier-free trade could cause harmful disruption to the industry's timely operating model, with the cost of just one minute of production stoppage in the UK alone at € 54,700 (£ 50,000)."

If the two sides return to the World Trade Organization trade rules , the likely consequence of a disorderly Brexit, the groups warned that the necessity of y tariffs would add € 5.7 billion to the EU-UK car trade bill.

Becomes an interesting look at security.

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