Wednesday, May 7, 2008

Strike Hits GM Plant That Makes a Big Seller

Strike Hits GM Plant That Makes a Big Seller

By Nick Bunkley

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Detroit - General Motors workers who build the Chevrolet Malibu, one of G.M.'s most popular and important new vehicles, went on strike Monday at a plant in Kansas after they were unable to reach an agreement with the company on local work rules.

It is the second strike by a United Automobile Workers local against G.M. this spring after a decade without any single-plant work stoppages. Workers at a plant that builds crossover vehicles, which are big sellers for G.M., near Lansing, Mich., have been on strike for nearly three weeks. Together, the plants employ about 4,500 people.

The two walkouts are in addition to a long strike at one of G.M.'s parts suppliers, American Axle and Manufacturing, which forced G.M. to close many of its truck and sport utility vehicle factories in March and April.

Though U.A.W. officials deny it, some labor experts say that the union is singling out critical G.M. plants for strikes in hopes that G.M. will prod American Axle to reach a deal with its workers.

Gary N. Chaison, a professor of industrial relations at Clark University in Worcester, Mass., noted that several other G.M. plants that were less important to the automaker's turnaround efforts threatened to strike weeks ago but continued negotiations without picketing.

"It's very rare that you get strikes on issues like this," Professor Chaison said. "They're trying all ways possible to put pressure on American Axle, having found themselves at a disadvantageous position in that strike. They're still showing that they're a party that must be reckoned with, that they still have some influence and leverage in negotiations."

A message posted on the Web site of U.A.W. Local 31 in Kansas City, Kan., said workers at the G.M. plant in nearby Fairfax walked out because of at least nine unresolved issues, including concerns about management at the plant, job security and seniority rights. Wages and benefits are set by the national agreement that the U.A.W. signed with G.M. last fall.

"General Motors left us with NO alternative after ALL weekend meetings and NO progress to speak of - the choices were none," the Web site said. "This local union has worked very hard in the last 20 years negotiating these important issues and can NOT step backwards by giving into these management concerns."

Fairfax is one of two plants where G.M. builds the Malibu, which was overhauled for the 2008 model year. G.M. will be able to continue making the sedan in Orion Township, Mich., but even with both plants running it was having trouble keeping up with demand.

Sales of the Malibu were up 43 percent in April, even though G.M.'s overall daily selling rate was down 23 percent. On average, G.M. says buyers are paying about $4,000 more for the new version of the Malibu than the old one, which was sold in large numbers to rental car companies and other fleet operators. Reviews of the car have been overwhelmingly positive, and G.M. hopes it will finally challenge Honda and Toyota at the top of the intensely competitive midsize car segment.

G.M. has only about one month's supply of the Malibu in inventory, compared with two to three months for most other cars and four or five months for many slow-selling trucks. So a decline in production caused by the strike could quickly result in dealers' not being able to find a car with the options that a customer wants.

"G.M. is disappointed that U.A.W. Local 31 took strike action at Fairfax Assembly," said a G.M. spokesman, Dan Flores. "We remain focused on reaching an agreement as soon as possible."

About 3,650 workers at American Axle factories in Michigan and New York went on strike Feb. 26, saying the company's demands that wages be cut nearly in half were too harsh. The company says it cannot afford to continue paying its workers about $28 an hour while rivals like the Dana Corporation, which also has a U.A.W.-represented work force, pay about $14 for similar work.

Progress has been reported in the negotiations recently, but the sides remain in a tense standoff. American Axle recently warned the striking workers that if the union did not agree to reduce wages and benefits, the company would be "forced to plan for the potential closure of some, or all, of these uncompetitive facilities."

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