UAW strike not expected to last long, experts say
DETROIT (AP) — Bargainers for the United Auto Workers and General Motors Corp. on Tuesday night were close to reaching a contract agreement that would end a nationwide strike by 73,000 workers, two people who were briefed on the talks said.
Negotiators began work Tuesday morning and were talking into the night in an effort to halt the strike, which started at 11 a.m. Monday at about 80 GM facilities across the country.
Both of the people requested anonymity because the talks are private. One said negotiating teams were working out “small details,” while the other said that work was almost wrapped up on an innovative plan for the company to pay the union to form a trust and take over responsibility for retiree health care.
But Tuesday night, picketers remained at the GM factories and other facilities, although several industry analysts said they expected the walkout to be short.
A 1970 strike against GM went on for 69 days and helped push the nation into a recession, but industry watchers didn’t think that would happen this time.
Each side has something the other desires — the workers want job security, GM wants the union to take on the burden of retiree health care — and that’s the stuff that agreements are made of.
“The UAW and GM understand that a strike is a lose/lose proposition,” Deutsche Bank analyst Rod Lache said Tuesday in a note to investors.
Talks broke off Monday when the strike began, but resumed in the afternoon and continued into the evening when weary bargainers broke for a rest. Analysts were encouraged that the talks have continued throughout the strike.
The union said it went on strike largely because GM failed to make promises for future products and investment in U.S. plants. GM said it was disappointed and would work with the UAW to address its competitive challenges.
“I’m hoping we get a fair contract. I understand that General Motors has their back against a wall. But I don’t want to give them everything,” said autoworker Ernie Bruton, who was picketing Tuesday outside a GM engine plant in the Detroit suburb of Romulus.
Wall Street was taking a wait-and-see approach. GM shares slipped 32 cents, or less than 1 percent, to close at $34.42 Tuesday.
In 1970, the UAW’s strike against GM rippled through the economy. Production declined, unemployment rose and retail auto sales dried up, according to an analysis by Merrill Lynch. A 54-day strike against two GM plants in 1998 wreaked similar havoc and cost GM $2.2 billion.
Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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