And so the United Auto Workers (UAW) strike at American Axle (AA) now enters its second month, without any imminent prospects of resolution (i.e. a GM payout). As Buffalo's Business First points out, "The upper hand clearly goes to (American Axle management) which has $350 million in cash on the balance sheet, does not need to supply GMT900 pickup truck axles for quite some time and has recently begun producing axles for the GMT900 SUV in its Mexican facility." Even so, the strike has shuttered 28 GM plants, and there's no way AA could ramp-up to supply all of the truck-making factories from South of the Border. And while GM may be happy to watch its oversupply of SUVs and trucks melt away, there's a limit to how long they can afford the resulting termination of their cash flow. And now it seems that the AA strike is spreading in an entirely unwanted direction: Chevrolet Cobalt production at Lordstown. (Say what you will about the car– and God knows you have– but it's The General's second best selling car at over 200k p.a.) The Tribune Chronicle reports that "United Auto Workers Local 1112 President Jim Graham said the 2,400-worker factory could stop building the Chevrolet Cobalt small cars anytime between Friday and April 4 when it runs out of a [AA-made] part to make brakes that are used by nearby supplier Automodular." There's a 53-day supply of Cobalts on the ground, but no question: that's gonna leave a mark.
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There’s a 53-day supply of Cobalts on the ground, but no question: that’s gonna leave a mark.
That’s not a terribly short supply though, right Robert?
Oh no! What will America do? We’ll have to resort to Honda Civics and Toyota Corollas while we recover from the lack of Cobalts…
Oh wait a minute – that’s what most Americans do anyway when they want a good small car.
About all this is going to hurt is the rental agencies.
You guys are killing me :)
I suppose that this also will effect the hugely popular G5.
But don’t cry for the rental agencies as the Plastech supplied Caliber is still being produced.
“About all this is going to hurt is the rental agencies.”
And Americans who still care to buy American made products from American held companies…
Even if it’s not popular to MOST americans.
gawdodirt :
March 26th, 2008 at 7:04 pm
“About all this is going to hurt is the rental agencies.”
And Americans who still care to buy American made products from American held companies…
Yeah, you guys are already in enough pain.
I just got home after returning my Cobalt loaner while my ’87 Saab was in the shop Not to beat a dead horse, but do the GM decision makers ever drive a non GM car? I was shocked how toy-like the Cobalt felt. I can’t say that it was a bad car, but it’s no where near the level of a Civic or a Corolla (or my 21-year-old Saab). I can’t imagine that anyone who has driven the competition would say that a Cobalt is competitive, but they must because the OKed it for sale.
Back on topic though: How many plants does GM have? Is having 28 shut down a big chunk of them or is it scratching the surface?
That AA strike is no joke. Read the first two of these paragraphs:
http://www.my3cents.com/showReview.cgi?id=34031
Had to pull one off the line for a dealer repair!?!
86er :
That’s not a terribly short supply though, right Robert?
A 60-day supply is considered ideal.
What? No Cobalts?
It’s morning in America.
Did anyone ever find out if the UAW employees at the closed plants are getting paid not to work?
Don’t worry; they won’t sell out of Cobalts.
One way to stimulate demand for Malibu’s.
Besides, if I want ‘Merican made metal I’ll go get A Fusion, err Impala, err Charger.
I suppose that GM could start pushing Saturn Astras into the rental fleets. It might even be a good idea if the Astra is a good car. Get some people to try ’em out.
I did not expect GM to drag out this strike for so long. Looks like the problems will get bigger until GM decides to settle somehow with AA.
Having spent a recent weekend shopping small cars, I’d rate the Astra third in class – behind the Civic and Mazda3 but comfortably ahead of the GTI, even farther ahead of the Focus, and miles beyond the Cobalt/G5 twins. I didn’t bother with the Corolla or Caliber. I might have rated the Astra higher if I’d driven it, but I couldn’t get comfortable in it. Every time I moved my right leg it’d hit the steering wheel. I’m not unusually tall (6-0), but I also had a similar problem once in an ’89 Crown Vic, so that shouldn’t be held against the car. We’ve probably all tried on cars that just didn’t fit.
Landcrusher
Did anyone ever find out if the UAW employees at the closed plants are getting paid not to work?
For now, laid off GM employees receive about 70 percent of their weekly salary. I couldn’t find out how long that would last, but I’d hope it would be time-limited. What laid-off UAW employees at other companies that have shut down due to the strike receive depends on the terms of their specific contract.
Laid off workers (but not those who are on strike) can also be eligible for unemployment benefits in many states. However, in some states (such as Ohio, where the Cobalt plant is located) you can’t get unemployment if you’re a member of the union that called the strike, even if it’s not against your company.
The ones this strike are affecting the most are those small businesses like trucking and delivery companies which have had to cut back or shut down. Most of those workers don’t have cushy contracts that guarantee pay if they’re laid off due to a strike somewhere. They’re the ones who are really paying the price for the UAW’s and American Axle’s stubbornness.
The Cobalt isn’t a bad car. The ’09 gets 35mpg highway, or you can get a 260hp motor that returns 30mpg; it’s built in the USA by an American company, which is important–regardless of what the Death Watch sadists think; it does well in crash tests; and at a days supply of 53, is apparently a popular car at retail AND stays on the ground 20 days fewer than the Civic, 40 days (!) fewer than the Sentra and 30 days fewer than the Mazda3.
Idling the plant is a sad outcome, and I hope it gets all resolved soon.
Buick 61,
I agree. For those of us who value the cash more than a socially acceptable nameplate (I know anathema on an auto enthusiast site), American steel is an important low-cost alternative to pricey foreign vehicles. I worry about the ramifications of a shuttered American manufacturing sector.
Buick61:
at a days supply of 53, is apparently a popular car at retail
Apparently not. A significant percentage of Cobalt sales go to fleets.
FW,
Thanks for that info. I suspected that was the case. I find it unfathomable that the government allows an organization of people to pull a stunt like this.
It’s like the cable company charging you 70% of your cable bill while cutting you off from cable because they decided your neighbor wasn’t ordering the right cable package.
I don’t say that the Cobalt is a bad car (there are very few truly bad cars out there today), only that there are better ones. The Cobalt is light-years ahead of any other small car GMNA has ever built, but they’ve still got work to do.