UAW Strike Over – GM building trucks again

All the drama is over – the UAW is back to work building Silverados and Yukon XL’s. Move along, nothing to see here. The worries about a prolonged strike were completely unfounded, because GM is a poorly run company that makes poor decisions over and over again. As is the norm, GM caved in to the UAW’s ridiculous demands – this time in under 40 hours. The UAW did make some concessions, but it’s hardly what I’d call a fair deal. Here’s the breakdown of what transpired:

GM Wins:

  • $50 billion worth of health care liability off the books – and into the hands of the UAW
  • New pay rate for temporary workers – $18/hour vs the normal $28/hour
  • Changes in the Jobs bank – not disclosed, so no idea what effect this will have

UAW Wins:

  • Wage increases – 3% for the first year, 4% in second year, and 3% in the third.
  • Retiree health care fund managed by the UAW. GM provided enough money to last at least 80 years
  • Job guarantees that weren’t fully disclosed – no idea what this really means
  • 5,000 temporary workers promoted by GM to full-time employees

So to sum it up, GM paid off the UAW to cover the ridiculous promises they made for retiree health care. Bad call for GM back in the day, but good to see that they’re taking care of their retirees. The wage increases I don’t see at all – the UAW workers make way above market value as is, not even considering their amazing benefits package. Giving them raises borders on absurd. I’m sure these folks work hard, but putting body panels on a Yukon doesn’t really seem like a $30/hour job.

The lower rate of pay for the hired temporary workers is a semi-good call. The fact that they were hired as full-time seems foolish at a time when GM is continuing to lose market share… but at least they didn’t command $28/hour. So it’s not a positive, but rather a less bad negative.

At the end of the day, GM caved, the UAW won, and bad decisions were made all around. It’s just the latest chapter in GM’s death spiral.

Source: Automotive News

Published on September 26, 2007 in GM

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