Mitsubishi’s Normal, Il factory is the nation’s most under-utilized auto plant. Facing declining American sales, its operators have cut costs to survive. But unlike other transplants, Mitsubishi employs UAW workers, so it can’t just kill its workforce and feed them to Japanese-made robots, right? Well, Mitsubishi has actually surpassed the realm of mere xenophobic science fiction and has managed to wrangle concessions from the United Auto Workers. Bloomberg reports that 1,260 members of UAW Local 2488 approved pay cuts of nearly five dollars per hour and higher benefit costs in a new four-year contract with Mitsubishi. So much for the long-running Detroit narrative of the UAW being blind to the struggles of automakers and squeezing the life from domestic manufacturing. Sales and production have been cut in half at Mitsubishi’s American operations since 2002, and apparently the union get it. It’s not exactly a happy story for anyone, but the bottom line is that jobs are being kept in this country. Incidentally, this story explains with the utmost clarity why Detroit and the UAW joined forces to make a run on the federal piggybank. Otherwise they would have had to face the music and make an unpleasant but ultimately sustainable compromise like this one.
The factory is scheduled to only make about 54,000 +/- cars a year now. One shift.
So UAW is not completely ignorant to reality – just only 5-10 years too late realizing this factoid. Sorry but if a company cannot be flexible in today’s global competitive environment – it will not survive and the D2.8 and UAW is the poster child of this problem. Too bad we’ve marked them “too big to fail” and will continue to support these fat, obese companies and workforce just to keep some uncompetitive jobs.
Bad companies must be allowed to fail so that good companies can survive. Sounds tough, but it’s a must.
I hope they make it. Making smart, tough choices represents survival for modern businesses (that is, of course, unless you decide to feed at the federal bailout trough instead).
Its on once shift now, but wait until GM goes down and tightens up capacity. Once a hard economic winter culls the heard a bit (absent government intervention) it makes for a better spring for the rest.
I wonder how the compensation at this plant compares to the big 2.x?
Current UAW scale at GM is ~$27 something hour with a extra $2 for swing shift.
Nice people with great intentions, but put a fork in them because they are done.
$50K a year for a factory worker is not excessive.
GM and Detroit are going down because of failed corporate management — not the unions. Replace every UAW worker with a robot, but you’ve still got to move product.