GM and the union: Weary, confident, still talking 'We're going to outlast them,' UAW bargainer vows

March 21, 1996|By BLOOMBERG NEWS SERVICE

DAYTON, Ohio - General Motors Corp. and United Auto Workers negotiators, weary after more than 80 hours of almost nonstop bargaining, still seemed to be waiting for the other side to blink.

Union leaders appeared tired but confident as they emerged for a brief break from talks at the Delphi Chassis plant, site of the TC 16-day strike that has shuttered 26 of GM's 29 assembly plants, idled 175,800 GM workers and slowed the growth of the U.S. economy.

"We're going to outlast them; they're going to give in," Steve McCarroll, a union bargainer, told strikers. Company officials suggested privately that that may be wishful thinking. Negotiations were continuing into the evening.

The strike is expected to cut the economy's previously anticipated growth rate of 1 percent in the first quarter by a third, economists say.

About 3,000 workers went on strike March 5 at two Delphi Chassis Systems brake plants, causing a shortage of brake parts that has crippled car and truck production at GM's 29 North American assembly plants.

GM said yesterday that it laid off about 10,800 more workers because of the strike. Among the layoffs are 69,000 assembly plant workers and 106,800 components makers.

GM factories in Silao and Toluca, Mexico, are the only two North American assembly plants still operating. A minivan plant in Georgia is closed for new-model changeover unrelated to the strike.

Analysts continue to laud the company's hard-line stance in the strike. GM shares remain above their prestrike levels, although they fell 75 cents yesterday to close at $53.50.

Any short-term reduction in profits will be recouped if the company can come out of the strike with the ability to control component costs and the size of its work force, said Smith Barney analyst David Garrity.

"There are some very significant advantages to GM fighting for these principles," he said.

Union members admitted that the strike has lasted longer and has had far more ramifications than they expected. A walkout at the two Dayton brake plants two years ago was settled in three days when GM essentially gave in to union demands.

"This is bigger than we ever thought it would be," said striker David Shores.

The strike has become so big that U.S. Labor Secretary Robert Reich yesterday offered the services of federal mediators. Neither side accepted the offer, but Mr. Reich said he continues to hope the walkout will end soon.

"The company and the union have a long history of resolving disputes without the assistance of federal mediators," Mr. Reich said.

Negotiators have been meeting almost continuously since Sunday.

Neither side would comment on progress of the talks.

At issue is the union's demand for more job security while GM wants to reduce costs by shipping some work to outside companies.

The strike continues to take a toll on suppliers. The latest to announce a shutdown was Garden State Tanning, a U.S. Industries Inc. subsidiary that makes leather for car seats. Garden State idled two plants employing 260 people in Michigan and Pennsylvania.

Cherry Corp., a maker of electrical switches and sensors, said it laid off 200 workers at a Waukegan, Illinois, factory that supplies GM.

ITT Industries Inc.'s ITT Automotive subsidiary has laid off 3,100 workers in the U.S. and Canada. The company employs 35,000 worldwide.

The strike will probably cost the automaker more than $500 million in first-quarter profits, analysts have said. The company is expected to earn $2.04 a share in the first quarter, the average estimate of 15 analysts surveyed by First Call Corp. GM earned $2.2 billion, or $2.51 a share, in the first quarter last year.

Meanwhile, GM settled a labor dispute in Anderson, Ind., by agreeing not to sell its lighting and bumper plant there for three years. In return, the union agreed to adopt more flexible work rules, said Charlie Kabrich, UAW Local 663 shop chairman.

"We feel confident the changes" will make the plant profitable, Mr. Kabrich said.

Pub Date: 3/21/96

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