Labor Settlement Offers Reprieve To Gm
The United Auto Workers agreed to a new contract at an axle manufacturer minutes before a strike deadline Monday, averting a walkout that could have crippled General Motors Corp. within a matter of days.
Terms of the agreement with American Axle & Manufacturing Inc. were withheld pending ratification this week by 7,200 employees at five plants in Michigan and New York. But UAW President Stephen P. Yokich and Vice President Richard Shoemaker praised it Monday as “an excellent new agreement.”
American Axle supplies rear- and four-wheel-drive axles for virtually every GM pickup and sport-utility vehicle. A strike could have forced the automaker to halt production within days at 12 North American plants employing 37,500 workers.
American Axle also makes parts for a variety of Ford trucks. However, analysts said the shafts used by Ford would be easier to obtain from other sources than the assemblies bought by GM. Ford refused to speculate how long it might have taken for a strike to affect its assembly lines.
The agreement was reached 15 minutes before a 7 a.m. strike deadline at American Axle plants in Detroit, Three Rivers, Mich., Buffalo, N.Y., and Tonawanda, N.Y. The UAW had originally threatened a strike at midnight Friday but extended its deadline while talks continued.
The talks were the first since GM sold the plants to American Axle in 1994. The UAW was said to be seeking a contract with wages and benefits matching the union’s new contract with GM, while American Axle wanted cuts to make it competitive with other suppliers.
The union members’ wages - averaging $22 an hour - and their benefits had been carried over from GM.
In another UAW contract dispute, talks resumed in Detroit over the weekend for the first time since Feb. 10 for striking workers at the Plymouth plant of Johnson Controls Inc., a maker of automobile seats. No new talks were set for striking workers at the company’s plant at Oberlin, Ohio. That walkout has disrupted production of Ford Econoline vans and Ford Expedition sport-utility vehicles.