The nine-day-old UAW strike on American Axle has already halted production at five GM plants and seven suppliers, and the two sides have yet to hit the bargaining table. That will change today, as both sides at least agree that they should be trying to reach an accord. The two sides are still far from agreeing on anything else, however, as American Axle wants to cut wage and benefit costs in half, even though the parts supplier is currently profitable.
Following the pattern of wage cuts at other suppliers, American Axle is prepared to offer buyout packages of $80,000 to $110,000. American Axle may also offer buy-down deals that will give workers a bonus for a number of years to cushion the blow of wage cuts. So far the strike has done little to hurt GM, as the automaker has been able to pare-down SUV and truck inventories while its plants are idled, but it's only a matter of time until the best available vehicles are gone. The 20,000 workers at GM and several suppliers that aren't working because of the strike are likely a bit more worried, but at least the two sides are talking.
[Source: Detroit News]
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Reader Comments (Page 1 of 2)
cowboy bob @ Mar 6th 2008 7:28AM
Strike your way to the unemployment lines you a-holes. Doesn't anyone in this industry understand where they are on this lifeboat? The stupidity of this is incredible.
brian @ Mar 12th 2008 6:07PM
i here you bob bring in the replacment workers thanks to their strike here i sit laid off wondering how i am going to support my family leave them all out there and bring in the replacments!!!
tanooki2003 @ Mar 6th 2008 8:54AM
the whole idea of the UAW is what's killing the domestic companies right now. UAW should totally be abolished, especially the striking members. Remember there is young and new talent that can actually bring life back into the domestic companies.
Boo for UAW supporters!!!
Vi @ Mar 6th 2008 1:50PM
You say when a company doesn't make what they should be making, what should they be making, as far as a profit? When is enough, enough? How much money does a CEO/CFO need to make to live? Can we say Corporate Greed??? AMERICAN Greed??? I/we made the company I work for 37% profit last year, yes you read that right, 37%! And guess what? They are starting to out-source some of our jobs. If you are a business man as you say I bet you would be estatic if your company made that kind of profit, and you got a slice of that pie. And don't say you wouldn't!!
tanooki2003 @ Mar 6th 2008 2:18PM
My company is doing just fine and everyone at my companies knows how to get along, not to mention finances are in good shape. In my companies they are already global with one here and another in Malaysia, which also gives some of my employees here an opportunity to work in Malaysia if they wanted. There is no greed amongst me when it comes to my companies. Sure I would like for them to profit like Microsoft but that will not happen since I am not a software developer creating an operating system that everyone needs.
My companies are a great place to work because I always like to keep the moral high and appreciate everyone's unique and individual. Of course when someone becomes a dead weight and refuses to shape up, even after numerous attempts and chances, I will cut that person loose without hesitation before it brings down the moral and the company. I've been a successful business person for the last 3 years and pass the opportunity down to my employees so they profit as well.
Jeff Johnson @ Mar 6th 2008 9:05AM
America is a great country - except for the fact it seems to be the only place where you can walk out on a job like an A-hole, and get a six figure reward.
These workers that demand all this crazy stuff seem to not understand that there is a job market out there. And if they do not like whats going on, go find a new job! It's not really that hard. Do they expect that once they sign on to work, its going to be a never ending gravy train? Times change, economies fluctuate, and in the seeming recession we have started into they think that everything is going to hum along as before? There are tons of arguments on why the UAW is asinine and a complete drain on GM.
In the end the only thing that matters is that you walked out on your job just because you want to see if you can squeeze some more money that you don't deserve out of your employer. I have no respect for that.
Vi @ Mar 6th 2008 9:43AM
Is it fair that the company wants to cut wages in half? Could you live on half of what you earn right now and still keep EVERYTHING you own? Look and see what the union has proposed. Have you who have criticized thought about what will happen when these workers either have to take the wage cut to half their wages or lose their jobs altogether? When they lose their homes, who will buy them? How many of them will sit empty along with those that are already foreclosed on because there are no jobs that pay enough to be able to afford them? What about gas prices? Over $3 a gallon now and going higher?
Maybe when they send your job overseas or higher someone younger willing to be paid less than you so the CEO can get his/her big bonus...
Go to www.executivepaywatch.com and find out just how much your CEO/CFO made last year and see how you feel about these strikers!
tanooki2003 @ Mar 6th 2008 10:24AM
If a company is not doing well and not making the financial numbers that they should be making then the company reserves the right to do what is necessary to get them back up or otherwise totally fail. If it means letting a few people go then so be it. If they have to hire new and younger talent in order to remain competitive then again so be it. If they sit on the same soggy employers who are more of the paperweights instead of the go getters then ultimately the whole company suffers and then it becomes bad for everyone. Look at the market share of the domestics continuing to decline in the automobile world. It's certainly not "well if it is a foreign car then it must be better" perceptions that kill them, it's their quality of output, which has not been that competitive when compared to the imports. Yes they have gotten better but at a turtle's pace while the imports are moving quicker than a rabbit. If this is a surprise to you then you may need to open your eyes more. I am well focused to the automotive industry mainly because I have close friends who work at different automobile companies throughout the world, not because i hear my neighbor saying "my chevy lumina sucks".
As a business owner if you have dead weights that refuse to change their ways, participate, being an asset to the company and contributing to helping the company grow you drop them like a bad habbit, regardless if they have 2 mortgages, going to lose their home...etc. If that was a concern to them it should be a motivating factor in them improving themselves to become better. If the company the employers are working at wants to reduce their pay in order to help rebuild the company's finances then they can either suck it up and deal with it or find another job. it's just that simple.
Thank goodness my businesses do not support or are involved in unions. The thing I hate the most is someone forcing me to keep a dead weight in the company just so they can pay their expenses. I don't work that way.
hooligan @ Mar 6th 2008 10:27AM
How is it that a company spends upwards of $70 an hour for it's labor force and that labor force says that isn't enough? Fire the bastards and hire those who are more than happy to do the same job for benefits and lesser hourly wage.
montoym @ Mar 7th 2008 1:26AM
Depends on your definition of fair I guess. I don't know about you but I know I didn't sign a contract at my job stating that I'd make a certain amount for "X" number of years. If my employer chooses to cut my pay, I can sell my skills on the job market and look for a new job if I don't like the pay(or anything else about the job for that matter).
If your skills are worth the pay you receive now, then you should be able to find a company willing to pay that, if not, maybe you were being overpaid for your skills. No company wants that. I don't really see how "fairness" makes an entry into this situation.
You know how the US killed it once thriving steel industry? Unions fighting for "fair" wages while their jobs went overseas to cheaper labor. Now most of the World gets their steel from Japan and the US steel industry is virtually non-existent.
dianne @ Mar 6th 2008 10:48AM
My husband does NOT make 70/hour. If he did I would plop my fat butt on the couch and roll around in money. I work as well. He works HARD at his job. So much so that he ices his shoulders down EVERY frikkin day. He's not an old man either.
He brings home around 50 grand/year BEFORE taxes. He is not asking for more. He just wants to be able to keep his home. His income would go down to around 30 grand/year if this cut went into effect. We DON'T live above our means. I cut coupons and shop sales. We DON'T have two homes, we have two cars and one is all paid for (and 11 years old). We have next to nothing on our credit CARD (yes, ONE) We get by with a little into savings. If his wages would be reduced that much, we would make to much to get help, but not make enough to save anything for emergencies and we could lose our home.
And, we would NEVER be able to afford a new car. Talk about not being able to afford the product you are helping to make. Gees, people, regardless of your job or education level, think about what you would do if your boss came in and said, 'um, sorry, you're losing half your pay and we're taking some of your healthcare benefits away.' Yes, you'd look for a new job, but you'd be hard pressed to find one, even at a reduced wage.
I am just hoping they get a contract signed, because I am sure AAM will close their plant in two years like they said and move it all to MExico (where they make less than taxi cab drivers down there). Then he can go back to school on NAFTA's dime - since this started it all anyway. (Oh, and Dick Dauch said if Mexicans aren't willing to work for their pittance, he will find somewhere CHEAPER).
When he does move it there (which is inevitable) he needs to change the name to CENTRAL American Axle & Manufacturing, cause it won't be USA anymore.
DD = Death to the Middle Class!
Jason @ Mar 6th 2008 3:34PM
Hopefully Autoblog puts this comment where I want it to.
The $70/hr figure comes from the entire cost of the employee, not just what they bring home. Factor in the cost of health care benefits, life insurance benefits, insurance to insure that employee against work place injuries, etc. etc. and that's where the $70/hr comes from.
Richard S. @ Mar 6th 2008 11:42AM
Couldn't GM actually weather this strike as the production being affected are of those big trucks where they already have over 70-90 days supply, and especially now with oil at $104/bbl.?
dianne @ Mar 6th 2008 12:38PM
Actually, I think AAM and GM got together before this happened and schemed a way to make it the Union's fault all these layoffs happened. This way they can cut their inventories and still be 'the good guy' and the union at AAM will be the bad guys for causing all these people to be out of work.
That's been my contention all along - as soon as GM starts getting heat and their inventories at a more manageble level, they will prod AAM to 'talk'. Well, with almost 20,000 people out of work, GM is probably hearing it from someone. So back to the table AAM goes - with as few concessions as possible.
John @ Mar 6th 2008 1:00PM
The greedy unions is the reason you'll never see another new car factory built in Michigan.
uaw member @ Mar 6th 2008 6:14PM
no your wrong china mexico and india is why you wont see any plants being built here.when your kids need a college education to work at mcdonalds or burger king because all of our jobs are being sent out of the country youll think differently.
Vi @ Mar 7th 2008 1:03AM
The $70 an hour is not what the worker takes home, it is hourly, medical and pension rolled into one that comes to $70 an hour. If you did your home work this is what the AAM worker's make an hour:
Skilled Trades-$32.13 an hour. Company wants them to go to $20.50 an hour the union countered with $27.00.
Production jobs pay between $17.50 and $28.15 an hour. The company wants them to go to $11.50 and $14.50 an hour, the union countered with $14.56 and $21.00 an hour.
Who is being unfair?
Ya know it really doesn't matter because eventually all jobs will be going to Mexico or China. And even if all unions crumbled and everyone made say, $10.00 an hour like you propose, would vehicle prices come down? Probably not.
Formerguy @ Mar 7th 2008 1:34PM
Vi:
I'm a former AAM employee who got the boot from the "idling" of the Buffalo plant. Thanks for keeping everything in perspective here. Just accepted a job for 15 bucks an hour, and have to pay into my health care, life insurance, and 401 pension, not to mention paying for gas that will be $400/gal before summer. How dare those poor souls at AAM ask for a decent way of life, when the corporate goons sit on their pensions, stock options and golden parachutes? Let dopes like tanooki and john and hooligan believe that raping the autoworkers will save the manufacturing base in the US. They'll still pay ever-increasing prices for autos, gas, and everyday commodities (like food). Even the telemarketing business is being offshored for the sake of corporate greed. Dickless Dauch ain't gonna stop at 11.50 per hour, especially when he can pay his Asian workers 11.50 per week. Wake up and stop your dreaming, you jealous, bitter jerks. NAFTA and our economic policies have got to go. Hold out UAW!
montoym @ Mar 7th 2008 8:07PM
Welcome to life for the rest of us.
I can't just go and force my employer to pay me more because gas went up a little bit. Honestly, I prefer it that way. At least I know there will be other jobs to take its place if I don't like it. When you force an employer to pay more than they can afford, guess what, you eventually lose those jobs period.
I truly don't mean to be brutal, but your union's actions are the very reason those jobs are moving away from Detroit and the traditional manufacturing centers to the South and without unions. It's also a prime reason why the US auto industry is having to work so hard to compete with imports, past promises made to unions decades ago that continue on.
Regarding the lavish pay and bonuses paid to executives. That's a cop-out honestly. I agree that some do get far more than they should, but even if you paid them nothing and split it amongst all the workers, it's not like you pay would increase all that much.
India Bound @ Mar 9th 2008 7:54AM
I've worked in a call center in Canada for 5 years where Chrysler is our client. We are not unionized and the company that hired me had just received a 3 year contract with Chrysler but when ownership of Chrysler changed, so did the contract as we lost it. A new company is now in place to do a transition of my employment to India and the US. Union or no union, when they want to go, they will. I never made 15 or 20 dollars an hour, I made 12.50 and I just received my second raise in 5 years. The first was .52 per hour and I just got another .10. LOLOL... I still think that's funny. I have to laugh, what else can I do? I don't have a second income, that's all there is. If you think a union will save you, they may but not for long. As per other comments, they WILL go where there is no contract or union and they will make more money. It's happening already. Just like you, we never 'voted' for NAFTA, it was decided and for the record, our gas at the pumps is nearing/has been 1.09 per litre. Someone will always do your job for less and outsourcing is good for the businessman, not the little people like us. The totem pole theory is correct. They're always fatter at the top. When my job goes, that will leave nearly/ more than 200 unemployed and there are no jobs right now. Our city is turning into a ghost town as we put all our eggs in the automotive basket when they were doing well. Good luck to anyone who has stable employment in North America.