Steel Markets
Positive Signs as UAW/GM Review Latest Proposals
Written by Sandy Williams
October 13, 2019
Negotiations continued between the United Auto Workers and General Motors on Saturday afternoon. On Friday, the UAW presented a counter to the proposal GM submitted on Monday. Recent comments by the union hint that a possible tentative agreement may be in the works.
“A short time ago, today, Friday, Oct. 11, 2019, we counterproposed to the company’s last offer, which included all of your outstanding proposals that are all at the main table and unsettled,” wrote UAW-GM Vice President and Director Terry DIttes in a website post to the membership. “With this latest comprehensive proposal, if GM accepts and agrees to this group of proposals, we will have a tentative agreement.”
General Motors’ proposal on Monday increased worker compensation and improved profit sharing and contract ratification bonuses. The latest contract would preserve healthcare benefits at current employee costs.
More importantly, GM offered to increase its investment in the company to $9 billion–$7.7 billion of which would be direct investments in U.S. factories. GM workers have been increasingly concerned about jobs moving to Mexico where wages are cheaper and have urged the company to make more vehicles in the U.S.
Executive Vice President of Global Manufacturing Gerald Johnson said in a letter to employees that the company is committed to an agreement that is “fair and worthy of our team members’ support.”
“On Monday, we presented another offer we felt achieved our mutual objectives. It would increase compensation through wages and lump sum payments, preserve industry-leading healthcare benefits without increasing out-of-pocket costs, enhance profit-sharing with unlimited upside, and improve the ratification bonus. For temporary workers, our offer also would create a clear path to permanent employment and include a ratification bonus.”
The strike is in its fourth week and both sides say it is critical to return to production. Workers have been living on $250 per week strike pay and personal savings. On Saturday, the UAW said it would boost strike pay to $275 per week. The Center for Automotive Research estimates that the strike is costing GM about $450 million per week and the UAW strike fund $12 million per week.
GM stock has fallen about 9 percent since the beginning of the strike and analysts estimate the company is losing $50 million to $100 million per day in production. The strike has set off a ripple of layoffs at GM plants in Canada and Mexico as well as at GM suppliers.
Sandy Williams
Read more from Sandy WilliamsLatest in Steel Markets
Week in Review: Sept. 29 -Oct. 3
Let’s take a quick tour of some key stories from SMU in the week of Sept. 29 - Oct. 3.
Hot-rolled coil sources lament stagnant conditions
Participants in the hot-rolled sheet market expressed frustration with the continuing lack of demand this week.
Plate market sources critique mill hikes amid current market conditions
Following spot market plate price increase notices issued by domestic mills this past week, participants are contemplating the rationale behind the increases and whether they will stick. Some sources anticipate that current market conditions will shift in November and believe the increases may set a new "pricing floor."
ITC’s final ruling: Dumped, subsidized CORE imports are harming domestic market
The US International Trade Commission (ITC) finds that corrosion resistant steel (CORE) imports from 10 countries have caused material damage to domestic product producers, according to the ITC’s statement.
HR buyers report mixed market conditions
Hot-rolled coil market participants said they’re staying on their toes amid a market that continues to be characterized by uncertainty. A veteran Midwest-based service center operator contends that current conditions are unprecedentedly volatile. Being flexible with customers and strategic with mills is the only way to navigate through the uncertainty, he said. “No one wants […]