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Tuesday, Jul. 14, 1998
GM opens truck assembly plant despite strike
Automaker prepares for debut of '99 trucks, but stockpile of parts could run out within a week
By BRIAN AKRE
Associated PressFLINT, Mich. -- General Motors Corp. showed its determination Monday to proceed with the launch of its new full-size pickups, reopening one of its truck assembly plants that had been idled by strikes at two parts plants.
But production is expected to be short-lived if the strikes by 9,200 workers in Flint continue. Negotiations continued Monday after all-night talks Sunday. Gov. John Engler also offered to help break the stalemate.
The full-size pickup is GM's top-selling vehicle and among its most profitable. But the strikes in Flint threaten to thwart the automaker's plans to take on Ford Motor Co.'s best-selling F-series pickups.
``Everything's on schedule or ahead of schedule'' with the pickup launch, but that likely will change if the strikes continue much longer, GM spokesman Gerry Holmes said.
GM recalled 2,880 workers to the Pontiac East plant near Detroit to begin making ``pilot'' trucks to test equipment before the start of regular production. Production at the plant had been halted June 12 because of the strikes.
The automaker also reopened its Oshawa, Ontario, assembly plant where production of the 1999 Chevrolet Silverado and GMC Sierra twin pickups began last month. That plant had remained open until GM's recent two-week summer vacation shutdown, which ended Monday.
Both plants are operating with parts stockpiled in anticipation of the strikes, which began June 5 and 11. And in both cases, those stockpiles are expected to run out within a week unless other sources are found.
Oshawa is the lead plant for the manufacture of new pickups. It began limited production in early June, but before the vacation shutdown it was producing only about 250 vehicles a day as it continued to move toward full production.
GM's Fort Wayne, Ind., plant also is scheduled to produce the '99 trucks.
The automaker on Monday also reopened its Saturn small-car plant in Tennessee and a small-car plant in Ramos Arizpe, Mexico. Those plants, like Oshawa, had been unaffected by the strikes before they were closed for the vacation shutdown.
GM said about 165,000 workers across North America had been idled by the strikes as of Monday. With Pontiac East back up, 25 assembly plants and more than 100 parts plants remained affected by the strikes.
Two GM Powertrain plants in Toledo and Moraine, Ohio, were added to the shutdown list Monday. The engine plant in Moraine laid off 550 workers, while the shutdown of the transmission plant in Toledo idled 4,100 workers.
The company is expected to take additional cash-saving actions this week if no settlement is reached in the strikes, which are costing GM about $80 million a day.
Among some of the ideas GM may be considering are a halt to its stock repurchase program and deferring capital spending on future products and plant improvements, said analyst David Healy of Burnham Securities Inc.
``They also have said no salaried worker layoffs, but that's a possibility they have to consider,'' Healy said.
GM has said it may cut medical benefits for the roughly 100,000 U.S. workers who have been idled because of the strike. The company already has cut their dental benefits and all health-care benefits for the striking workers.
The union says it would provide health insurance to the idled workers if GM suspended it, as it has done for the striking workers. UAW Vice President Richard Shoemaker said cutting health benefits for nonstriking workers would violate GM's national contract with the union and that the move would be challenged.
``They have an obligation to provide health care coverage to those people who are laid off because of the strikes,'' he said. ``They know that.''
GM also has said the strikes may force it to kill off some slow-selling vehicle lines earlier than planned, and possibly close or sell some unprofitable plants.
After he suspended high-level negotiations in Flint on Sunday, GM labor chief Gerald Knechtel said the company would pursue its grievance that the strikes comprise an illegal national walkout under the UAW contract.
The union rejected the grievance, and management is seeking expedited arbitration. But without the agreement of the UAW, quick action on the matter is unlikely.
The stall in high-level talks affected GM's stock price Monday. GM shares fell $1.56 to close at $69.62 and a half on the New York Stock Exchange.
Meanwhile, talks also resumed at parts plants in Dayton, Ohio, and Indianapolis, where workers have authorized strikes about local contract disputes that have not been resolved. GM has demanded that those disputes be resolved as part of any Flint settlement.Post your comments about local news eventsFront Page || Main Index || News || Business || Texas || South Texas Outdoors || Birdwatching || Sports || Entertainment || Selena || Education || South Texas Attractions || World Wide Web