FOX Business’ Grady Trimble reports on the GM-UAW deal. Then, a panel, including FOX Business panelists Steve Moore and Carol Roth, discuss how other unions in the U.S. may react to this deal.
Rank-and-file members of the United Auto Workers agreed to end a strike against General Motors by voting to approve a new contract on Friday, a source familiar with negotiations confirmed to FOX Business.
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With the contract’s approval, a six-week nationwide strike that brought the U.S. auto giant’s supply chain to a halt will finally end after 40 days. Both parties had been in talks stretching into nights and weekends before coming to a tentative agreement.
Unionized GM workers are expected to receive an $11,000 ratification bonus as part of the deal, according to the Detroit Free Press. Temporary workers will receive $4,500.
UAW and GM are expected to comment on the contract later Friday.
The union called for a strike after expressing discontent with GM’s profit-sharing formula, production of vehicles in Mexico, a potential change in health care cost-sharing and pathways for temporary workers. Temporary workers’ situations seemed to be a sticking point for the UAW. Temps are union members doing the same work as permanent employees, but earning half the pay and fewer benefits.
Mary Barra, chairman and chief executive officer of General Motors Co. (GM), right, and Gary Jones, president of the United Auto Workers (UAW), shake hands during a GM event at the Renaissance Center in Detroit, Michigan, U.S., on Tuesday, July 16, 2
GM said employing temporary workers, who can work for a few months at a time, allows permanent workers to take time off. It also helps the company when scaling up production on new vehicles.
Industry expert Kristin Dziczek, of the Center for Automotive Research, said that the strike had some of its roots tied to GM’s 2008 bailout.
“The union agreed to some changes to help GM and Chrysler get through some really tough times,” she told FOX Business. “And now that [GM has] had a decade of very positive financial results, the union members wanted their share for that. It was difficult for the company to claim poverty.”
The strike cost GM roughly $1.5 billion in lost profits, and employees won’t see more than $835 million in direct wage losses, according to Michigan-based consulting firm Anderson Economic Group. Their calculations extrapolate to Oct. 20.
UAW members on strike said they were ready to wait out negotiations, but preferred to reach a resolution. Roughly 49,000 UAW members walked off General Motors factory floors when the strike began.
