The United Auto Workers called a nationwide strike against General Motors on Monday morning. This ends, at least for the moment, the hope of a groundbreaking settlement that would shift retiree health-care obligations off the company balance sheet. That would have paved the way for a fundamental reordering of auto industry labor relations and boosted GM’s ability to compete in the world.
So much for all that.
The UAW may consider this strike a smart strategic move designed to increase the pressure on GM. Contract negotiations resumed Monday afternoon, even as 73,000 unionized GM workers streamed off the job across the country. From the sidelines, it looks more like a sign of desperation by a shrinking union playing a weak hand.
GM’s unionized workers had hoped for a promise of job security, no short-term change in retiree health benefits and some kind of signing bonus. Now, they’ve got zilch. They’re manning picket lines while their employer has enough cars and trucks in stock to keep sales going for a while, provided the strike is short.
GM and the UAW had been talking for months and, for the last couple of weeks, around the clock. Success seemed attainable. The UAW seemed to understand the stakes. There were tantalizing hints that a revolutionary agreement to shift GM’s retiree health care obligations, of about $50 billion, off the company’s books to a union-run trust was within reach. Then it all broke down, however, over a much more familiar stumbling block: job security.
The last time the UAW authorized a national strike was 31 years ago. Back then, Detroit’s Big 3 — GM, Ford and Chrysler — owned a commanding share of the U.S. market and the UAW approached a historic high of 1.5 million members. The auto industry has shifted radically since then. The Big 3 lost a collective $15 billion last year, and their U.S. market share has fallen below 50 percent.
Foreign car makers outsell them with more attractive products and prices that don’t include crushing health-care and retiree benefit costs. UAW membership has fallen below 570,000 — and only 180,000 of them work in the auto industry.
You would think the UAW would understand that the only way to keep it from slumping into irrelevancy is to help GM become more competitive. GM has 73,000 active UAW members — and nearly five times as many retirees and surviving spouses. It needs flexibility to adjust its work force and costs. Its hourly labor costs top $73; Toyota’s are below $48.
But the union has pulled the plug, insisting it is “shocked and disappointed” over GM’s demands. So, the picket lines are up. If they stay up, GM will move even more auto-making jobs out of the U.S., the UAW will continue to shrink and the workers it professes to protect will be out in the cold. What a failure.
