Jeep maker Stellantis NV announced Wednesday that it would “immediately” lay off 68 workers at its machining plant outside Toledo, Ohio, as a result of the United Auto Workers’ strike at its Wrangler and Gladiator plant in the city, which has now lasted for the sixth day. Hundreds more could soon suffer the same thing.
The automaker expects an estimated 300 additional layoffs at Kokomo Transmission and Kokomo Casting in Indiana, according to a statement from spokeswoman Jodi Tinson. She declined to provide details on the timing of this.
The comments come two days before the UAW’s deadline to see “serious progress” in talks with the Detroit Three automakers, failing which it says it will hit more locals. 12,700 UAW members are already on strike in the union’s first simultaneous strike against all three companies.
Stock restrictions lead to layoffs at the Toledo Machining Plant in Perrysburg, Ohio. The site employs more than 400 hourly workers affiliated with the UAW and production for other vehicles continues.
“Stellantis,” the statement said, “continues to closely monitor the impact of the UAW strike action on our manufacturing operations.”
Stellantis is not alone in laying off workers at its other operations due to the strikes. General Motors Co.’s Fairfax assembly plant in Kansas is expected to face an outage as early as Wednesday due to the strike at the midsize pickup and commercial vehicle plant in Wentzville, Missouri.
Ford Motor Co. laid off about 600 workers at its Bronco and Ranger plant in Wayne last week after the UAW called for a strike by body and paint shop workers there.
The companies have continued dialogue with the union since the first UAW members left over the weekend, but there still appears to be no significant breakthrough toward a tentative agreement.
GM’s latest offer, presented Thursday, with a 20% across-the-board wage increase and other gains, would raise labor costs to $150,000 per worker per year, up from $134,000 in the current contract.
While UAW President Shawn Fain called the companies’ pay raise offers of about 20% inadequate, President Mark Reuss, in an opinion piece in the Detroit Free Press on Wednesday, called the automaker’s contract proposal a “record offer” and said the union’s demands would be “untenable.”
After the union said Friday it could add more plants to its strike that began Sept. 15, Reuss accused the UAW of spreading “myths” about what the automaker can afford and what it offers. He said GM’s offer “recognizes the many contributions our represented team members make to our company – past, present and future.”
Among the myths he wanted to debunk, Reuss wrote, was that GM “does not pay its employees a fair wage,” which he said was “simply not true.” GM’s current offer to the UAW would provide 85% of the company’s employees with a base salary of about $82,000 per year, according to Reuss. And some of GM’s entry-level employees would receive a maximum wage of $39.24 an hour at the end of a new contract, which would be a 141% raise for some workers, Reuss wrote.
Fain said the 20 percent wage increases offered by automakers were “not enough” after the union made sacrifices during the bankruptcies of GM and Chrysler LLC (now part of Stellantis). The UAW originally asked for a 40% wage increase without compounding (46% compounding), which has since fallen to 36%. The union also wants to abolish the wage scale.
Reuss also argued that GM is engaging in the tiered pay system. The Detroit Three have proposed shortening the time to reach the maximum rate from eight to four years.
He wrote that GM employees received “extremely generous retirement benefits.” In its latest offer, GM would continue its “company 401(k) contribution of 6.4% for employees who are not eligible for retirement.” The UAW wants pensions returned for all workers.
Reuss noted that GM, which is pushing toward an all-electric lineup in 2035, is “at a critical point in our journey toward an all-electric future.” This year, GM will begin production of all-electric versions of the Chevrolet Silverado, Blazer and Equinox – three of its most popular products with internal combustion engines.
The Silverado EV will be built by UAW members at Factory Zero Detroit-Hamtramck Assembly Center and Orion Assembly in Lake Orion. The Equinox and Blazer electric models are manufactured in Mexico.
GM’s offer to the UAW includes “labor and products for each and every one of our U.S. facilities,” Reuss wrote. “When we began the transition to electric vehicles, we made sure we had work for the entire manufacturing team so we could take everyone with us as we transitioned.”
GM’s current offer to the UAW does not include a plant closure, unlike in 2019 when the automaker closed a large assembly plant and two powertrain plants.
The UAW has alleged that automakers’ record profits are fueling corporate greed, with CEO Mary Barra (the Detroit Three’s highest-paid CEO) earning nearly $29 million in 2022. GM estimates that average employee compensation in 2022 was $80,034. The ratio of Barra’s compensation to that of an average worker is estimated at 362 to 1. In 2021, average employee compensation was $69,433, making Barra’s pay ratio 420-to-1.
To rebut the claim of corporate greed, Reuss wrote that GM’s net income was $9.9 billion in 2022 and that capital expenditures this year will be between $11 billion and $12 billion.
“If we don’t continue to invest, we will quickly lose ground,” wrote Reuss. “Our competitors across the country and around the world, most of whom are not unionized, will waste no time in seizing the opportunity we would offer them.”
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