GM strike settlement starts countdown here Broening Highway: Government and union officials must prove local plant can compete with the world.

July 30, 1998

EVEN AS General Motors workers nationwide contemplate a return to their jobs after a seven-week strike, the clock is ticking on GM's Broening Highway plant. Government and union officials soon must decide what price to pay to keep the automotive giant in Baltimore.

At stake are 3,000 good-paying jobs and a significant slice of the region's economy. City, state and congressional officials had a similar challenge last year, when they worked tirelessly -- and gave up much -- to win a $300 million cold-rolling mill for Bethlehem Steel Corp.'s Sparrows Point plant.

To save jobs at Sparrows Point, the state and Baltimore Gas and Electric Co. offered incentives worth $10 million, and the United Steelworkers of America made work-rule concessions that saved $130 million a year. The deal was good for workers and the area.

GM's Broening Highway plant would require major retooling. And like Beth Steel, GM deserves more than obligatory attention when discussing tax breaks and other incentives. This is no Bubba Gump. GM has a 63-year history of providing solid manufacturing jobs here.

Economist Anirban Basu of Towson University's Regional Economic Studies Institute, says closing the GM plant would cost the Maryland economy $336 million; keeping it open could help area parts suppliers and the Port of Baltimore, if GM ships vehicles from the plant overseas.

Whether General Motors deserves incentives -- and how much -- could help define this fall's gubernatorial debates. But it would be tough for any candidate to pitch the notion that GM should be allowed to abandon Maryland without the state making a major effort to keep the plant going.

GM CEO John F. Smith Jr. offered scant reassurance. In the past, the automaker said the plant would produce minivans until the year 2004. But after settling UAW strikes in Flint, Mich., Mr. Smith promised Sen. Barbara A. Mikulski only that Baltimore's plant will operate for two more years.

This reflects a fiscal reality for a company that must reduce production costs through consolidation and increased reliance on cheaper overseas factories to remain competitive.

Rather than view this two-year deadline with trepidation, we should look upon it as a wake-up call for government and union officials to persuade Mr. Smith that Baltimore can help GM in the global manufacturing marketplace.

Pub Date: 7/30/98

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