Media from Associated Press to The Business Standard of India are abuzz with reports that Fiat (the company) is planning to cut 5000 jobs and will be spinning off its car division this summer. The stock market seems to like the idea: Fiat’s shares rose 4.15 percent. Read More >
Workers at the former Toyota-GM joint venture NUMMI have approved a severance offer from Toyota. Union officials won’t reveal the exact amount involved, and while the Detroit Free Press reports that workers will make a “minimum” of $21,175, the San Jose Mercury says the deal “gives an average severance package of $54,000.” Could it be that some union brothers are more equal than others? What the Freep leaves out is that $21,175 minimum applies to 300 of NUMMI’s 4,700 workers who are already on disability leave. Workers with over 25 years of experience will receive $68,500.
The Detroit News reports that the United Auto Workers are gearing up for battle for a surprising new cause: greenhouse gas emissions standards. Alan Reuther, Legislative Director of the newly-green union, wrote congress recently to warn against a bill authored by Sen. Lisa Murkowski which would prevent the EPA from declaring C02 a danger to public health, saying:
The UAW also is deeply concerned that overturning EPA’s endangerment finding would unravel the historic agreement on one national standard for fuel economy and greenhouse gas emissions for light-duty vehicles that was negotiated by the Obama administration last year
All kinds of strange news are coming from GM’s Korean foster child Daewoo. Two days ago, Daewoo CEO Mike Arcamone announced: “In 2010, GM Daewoo will be profitable. That is my target.” That didn’t get much traction. Reporters wanted to know how bad last year’s numbers were. Arcamone remained tight-lipped. He admitted red ink for 2009, how much remains anybody’s guess. In 2008, it was $773m worth of red. Last October Daewoo-is-me had to be bailed out by the bailed-out GM to the tune of $413m. Arcamone has some soothing news: “We currently do not seek any other financial support from our creditors.” The operative word is “currently.” There is one way to stop the hemorrhage for good: Pack it in. Read More >
The House Oversight Committee has obtained a 2006 memo from the “All Toyota Labor Union” (ATU) which alleges quality declines due to “a fall in the number of experienced staff in favor of contract workers, longer working hours and an aggressive pursuit of cost cuts” according to Automotive News [sub]. The letter was originally addressed to then-Toyota President Katsuaki Watanabe, and was written during a Japanese criminal investigation of Toyota, in which the automaker was eventually cleared of all charges. In the letter, the 20-member ATU (curiously, only two members of the union work for Toyota Motor Company proper) demanded
a seven-point action plan from management including an explanation of the criminal probe, a review of the length of vehicle development period and a review of cost reduction methodologies
A Toyota press release [via Marketwatch] reads:
Toyota Motor North America, Inc. (TMA) today announced that Toyota has committed $250 million to its contracted manufacturer New United Motor Manufacturing, Inc. (NUMMI) to fund transition support for NUMMI’s salaried and hourly team members. Toyota’s financial support is enabling NUMMI to offer bonuses to salaried and hourly team members who continue to produce quality vehicles for Toyota through April 1, 2010, when Toyota’s production contract with NUMMI will end. This funding is subject to ongoing negotiations between NUMMI and the United Auto Workers with respect to those hourly team members represented by the union.
[Hat Tip: PickupMan]
If you were a company at time of recession, belt-tightening and countries on the verge of bankruptcy, you’d think that registering record profits and growing global market share at times like these would keep everyone at your company happy, right? Wrong. Members of Hyundai Motor’s union are angry. Livid. Up in arms. And as students of Asian cultures will confirm, Koreans can get, shall we say, a bit hot and bothered about causes close to their hearts.
Koreatimes reports that despite pleas from management for peaceful resolutions, their union has demanded that Hyundai stop expanding overseas and guarantee job security at home – or else. Read More >
Every evening and every morning, and times in-between, Nick Reilly wonders why he exchanged his cushy job as Shanghai-based chief of GM’s international operations with the purgatory of heading Opel in Rüsselsheim. This Tuesday morning, he woke up to more news from hell:
An unholy alliance of the center-right German government and the supposedly left-leaning unions told him that his turn-around plan for Opel is rotten, and if GM doesn’t cough up €1.65b, there won’t be a cent in government money. Read More >
You don’t want to be traveling in or to Europe these days. In Germany, Lufthansa’s pilots went on strike this morning, grounding 3200 planes. “The largest strike in the history of German aviation” (Die Welt) paralyzed German air traffic, and caused jams on the ground as travelers switched from planes to trains and automobiles.
Meanwhile next door in France, a nation is running out of gas. Workers at the six refineries owned by the country’s biggest oil group, Total, have been striking for more than a month. The work stoppage threatens to spread “to the two French oil refineries owned by US group Exxon Mobil, where strikes are planned for Tuesday,” reports the BBC. Read More >
Here are the first reactions to Nick Reilly’s turn-around and begging plan for Opel. In one word: “Booooh!”
Roland Koch, Premier of Hesse, where Opel has its headquarters, where most of Opel’s jobs and countless suppliers are, should be most interested in the survival. What was his reaction? “According to our first assessment, it will be necessary that GM as the owner will increase its contribution considerably,” he said to Das Autohaus. Translation: “Put money on the table. Then we talk.”
Little know factoid: In 2008, Opel was the 7th largest employer in Hesse, followed by Volkswagen, only 2,800 jobs behind Opel, most in a parts factory and distribution center in structurally weak Kassel. When Opel has finished its reduction in force plan, VW will provide more jobs to the state than Opel. Koch knows which side his bread is buttered.
The unions, which should be most interested in preserving jobs, immediately shot down the plan. Read More >
As GM tools up for production of its Volt extended-range electric car, Automotive News [sub] has noticed something interesting: workers at GM’s new battery pack assembly plant are not represented by the United Auto Workers. Located in the heart of UAW territory (Brownstown Township, MI), the Volt battery plant represents the very jobs that local politicians and GM leadership hailed as the green future of the auto industry. When the plant opened, GM Chairman/CEO Ed Whitacre waxed eloquent about the opportunities:
The development of electric vehicles like the Chevy Volt is creating entire new sectors in the auto industry – an “ecosystem” of battery developers and recyclers, builders of home and commercial charging stations, electric motor suppliers and much more. These companies and universities are creating new jobs in Michigan and across the U.S. – green jobs – and they’re doing it by developing new technology, establishing new manufacturing capability, and strengthening America’s long-term competitiveness.
As long as they do so without UAW representation, apparently. Needless to say, if GM can get away with using non-union workers at a crucial plant that’s supposed to represent the firm’s future, things aren’t looking so good for our friends in organized labor.
This week, Opel will embark on a pan-European begging tour. Applications for government aid will be sent to Germany’s central government, Germany’s states with Opel plants, and to the European countries where Opel has a presence. A business plan, and an expert opinion from the little known CPA firm Warth & Klein will complete the package, writes Das Autohaus. Target of the funds drive are €2.7b. Opel management still counts on wage concessions of €265m per year over five years (a total of €1.3b). Unions and the Opel Works Council already have said “nein” to the concessions. Governments want to see the paperwork first, Read More >
Opel is running out of time and out of money. In the second quarter of 2010, the company will be out of cash again, figures the German Handelsblatt. As indicated yesterday, discussions with the unions are going nowhere. Says the Handelsblatt:”Management is preparing for a breakdown of the talks.” Reilly and his crew are trying to find ways how to get Opel going without wage concessions by the unions. But how? Read More >
Opel’s turnaround negotiations with German unions have gone pear-shaped again, as top labour rep Klaus Franz left talks denouncing GM’s decision to cut 9972 jobs instead of the promised 8300, according to The Wall Street Journal. “Fundamental questions have not been answered,” fretted Franz. “Management’s plans seem to change on a daily basis.” Rudi Kennes, a labour representative from Antwerp, concurred, saying the atmosphere between management and the unions “has never been as bad as now.” He added ominously that “(Mr Reilly) needs to answer our questions.”
Read More >
Ford’s announcement that it would restore merit pay increases and 401k matching to salaried employees has drawn protests from the UAW even though it has restored profit-sharing for UAW workers. The UAW’s head of Ford representation Bob King tells the Detroit News:
They’re two separate issues. We gave up a long laundry list of benefits. None of that is being restored. We think they should use the money to pay down debt
We agree that they’re not linked,” say Ford spokesfolks. “But we don’t believe that we violated the contract.” And while the union bashes Ford for restoring white-collar benefits, it’s actually reaching out to salaried Delphi retirees, as MLive reports that UAW boss Ron Gettelfinger has written a letter to Delphi asking it to restore salaried pensions which are being cut. So does the UAW support salaried auto industry employees, or does it see them as an opponent in a zero-sum game? More than likely, the answer is neither. Or both. As this video of chaos breaking out at a UAW meeting of NUMMI workers seems to indicate, the UAW is still an out-of-control juggernaut, unable to share a coherent perspective on the industry. But hey, thanks to their ownership of a majority stake in Chrysler and about 15 percent of GM, they’re an out-of-control fact of life.
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