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A situation has developed between Allied trucking and automakers General Motors and Chrysler that has deteriorated to the point of hostage-taking. The Detroit News reports that GM has filed a lawsuit against the car-hauling company that alleges it's holding 1,700 of the automaker's valuable Chevy Silverado and Camaro models that should be on their way to dealers. The vehicles in question are worth $47 million, and many of them are reportedly already bought and paid for by customers. The suit also claims that the inventory will depreciate in value if dealers don't receive the vehicles, while at the same time dissatisfying customers.

The problems between Allied, GM and Chrysler started when the car hauler asked for a 15-percent raise. Allied had previously tried to cut the pay of Teamster union members by 20 percent, but was unable to do so due to a provision in the company's labor contract. GM then severed ties with Allied on March 16.

One day after GM filed suit against Allied, Chrysler filed its own lawsuit in Ontario Superior Court. Team Pentastar claims Allied has 700 of its vehicles at Allied locations. The court has already granted Chrysler the right to recover 200 of those vehicles. Chrysler has resourced its vehicle hauling to other car hauling companies as a result of the dispute.

[Source: The Detroit News | Bill Pugliano/Getty]

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    • 1 Second Ago
      • 4 Years Ago
      Cough up the cars, Allied. Theyre not your property, and youre making yourselves look like complete arses.
      • 4 Years Ago
      I think some of you have a fundamental misunderstanding of how a union works in a company. A union is labor and has almost no say in management decisions. Holding the cars would be a management decision and would have nothing to do with the union.

      Shipping contracts typically have some kind of fuel surcharge provision allowing for some increase in the shipping charges though perhaps not enough to cover a large surge in fuel costs. Without seeing the contract Allied set up with GM though there is no way to know.

      It is pretty simple.

      Allied signed a contract with the teamsters and they need to abide by it as do the teamsters. Allied signed a contract with GM and both parties need to follow the provisions of that contract too. It takes two parties to agree to the terms of a contract.
      • 4 Years Ago
      Not sure if allied is publicly traded, but now would be the time to sell that stock if they are.

      It's funny with some labor unions, they rather get layed off than make concessions.
      • 4 Years Ago
      It is not the union holding the cars, it is the truck companies.

      Although with truck company asking for a 15% increase in shipping charges (no doubt to cover the increase in the price of fuel), GM and Chryco can't say they did not see this coming.
        • 4 Years Ago
        If any of you hauled cars, you would know how low the rates really are. so for me , I say good going allied you might make it a little better for all of us car haulers, and chryslers rates really suck.
        • 4 Years Ago
        It sounds like GM and Allied negotiated a contract involving wage concessions on Allied's end, then when Allied tried to pass those cuts along by getting concessions from the Teamsters union, the Teamsters refused. So Allied just jacked up its prices after the fact, and GM refused to pay above the contract amount.

        I don't see how Allied has a leg to stand on here.
      • 4 Years Ago
      Looks like we have A Situation here...
      • 4 Years Ago
      This is actually common practice for moving companies. Once the stuff is on the truck, jack up the rate and hold the goods hostage.
      • 4 Years Ago
      1) The Union held their ground declining 20% pay cuts.
      2) Allied tried to raise their contract by 15% to maintain profits/cost.
      3) GM decided to go w/ competitors who are cheaper.
      4) The Union shot themselves in the foot. Losing a contract, some of them will be losing their jobs.
        • 4 Years Ago

        And because the union got greedy it could be the end of another company. Way to go Allied union, they really helped their workers out now. I too would have liked a 20% raise.

        • 4 Years Ago
        My apologies, I didn't read the the article correctly. I too wouldn't want a paycut. But the company's hands were tied, why because the unions wouldn't allow people to be cut. It still falls to blame the unions.

        I'm sure the company could have kept their rates competitive but would have to lay off a percentage of their workers which they were unable to do.

      • 4 Years Ago
      Having all the info could help avoid confusion...

      "Last Thursday Allied Systems ceased providing transportation services to GM. As a result GM took immediate steps to resource the work previously performed by Allied. Allied was in possession of 1,700 vehicles," GM spokesman Dan Flores said."

      So Allied said they needed more money to ship (don't know if they're under a contract with GM or what), then GM declined, Allied refused to ship unless they got the extra money, GM just contracted someone else, and Allied still had 1700 vehicles to finalize shipment on, to which they're holding out on GM.

      Sounds a little like extortion to me. Or possibly breach of contract. Either way, this is for the courts to figure out, I'm sure.
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