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May 23, 2008

US: Striking American Axle workers set to return

Workers at American Axle and Manufacturing (AAM) expect to return to work early next week after overwhelmingly approving a new contract that contains steep pay cuts and other concessions, it was reported last night.

Workers at American Axle and Manufacturing (AAM) expect to return to work early next week after overwhelmingly approving a new contract that contains steep pay cuts and other concessions, it was reported last night.

United Auto Workers members at five American Axle sites in Michigan and New York voted 78% in favour of the four-year deal, while 22% voted against, the Associated Press (AP) said, citing a union statement issued Thursday night. The UAW does not usually release vote totals, the news agency noted.

The vote, finalised only yesterday, finally ends a bitter strike that lasted nearly three months, crippling General Motors’ production of large sport utility vehicles and pickup trucks.

AAM was formed from former GM driveline parts-making units and the automaker is its largest customer.

The Associated Press said UAW members at four sites voted overwhelmingly in favour of the contract on Monday and had been awaiting Thursday’s vote by Local (branch) 235 in Hamtramck, which is by far the largest in the company with 1,983 members.

A contract governing local work rules and other items at the company’s Detroit manufacturing plant also was approved, by a narrower margin, a union official told AP.

The report added that workers on Thursday night expected the company to call in electricians and other skilled trades workers over the Memorial Day holiday this weekend to prepare the plants to reopen, with production restarting early next week.

AAM spokeswoman Renee Rogers told the news agency American Axle must wait for written vote confirmation from the UAW before deciding when to restart the factories. That was expected today (23 May).

About 3,650 UAW members have been on strike since Feb. 26 over the company’s demand for lower wages to match its U.S. competitors.

The Associated Press noted that American Axle had maintained it needed a wage structure competitive with other US auto parts makers so it could win new business.

Local 235 shop chairman Dana Edwards told thew news agency union members didn’t have much choice but to accept the deal.

“I think with the economy the way it is, with the truck sales the way it is, I feel that’s what people thought they had to do,” Edwards said.

The strike, which began on 26 February forced GM to cut production at or temporarily close more than 30 factories and also caused thousands of layoffs at GM and other auto parts suppliers.

GM has said it lost US$800m in the first quarter and produced 230,000 fewer vehicles due to the strike.

But, AP noted, the strike also helped GM control its inventory, coming at a time when high fuel prices and a slow economy reduced demand for trucks and SUVs.

GM spokesman Chris Lee told the news agency the auto maker plans to bring its idled factories back on line but would not reveal details last night.

AP said the final deal would see AAM workers take pay cuts from around $28 per hour to $18.50.

Workers also have the choice of taking a $55,000 early retirement incentive or up to $140,000 to leave the company.

Also under the deal, American Axle will close its Detroit and Tonawanda, New York state, forge operations, the Associated Press added.

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