UAW, GM reach tentative pact, strike not over

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DETROIT — The UAW and General Motors on Wednesday reached a tentative deal on a new four-year labor contract covering wages and benefits for 46,000 hourly workers after a 31-day national strike against Detroit’s largest automaker.

It was not immediately clear when the work stoppage, currently the longest against GM since 1970, would end.

The union’s national GM council will gather in Detroit Thursday morning to decide if they’ll accept the tentative deal and vote on whether to immediately end the walkout or continue it until the tentative agreement is ratified by members. Union officials plan to discuss the contract journalists following the meeting. The union’s ratification process typically takes several days, perhaps as long as two weeks. 

“We can confirm the UAW’s statement regarding a proposed tentative agreement,” GM said in a statement. “Additional details will be provided at the appropriate time.” GM shares rose 1.1 percent to close at $36.65 on Wednesday. 

“We have been working very hard on getting an agreement that makes the most amount of sense for our employees, for our business. We’ve been working around the clock on that,” GM CFO Dhivya Suryadevara said at the Automotive News Leading Women conference Wednesday.

An end to the strike would bring relief not only to union members who have lived for nearly a month on $250 weekly strike pay (which on Oct. 13 was bumped up to $275 weekly), but to dealers desperate for repair parts, suppliers waiting to fulfill orders and an automaker that has hemorrhaged an estimated $50-$100 million per day as its inventory has dwindled.

Details of the proposed pact were not immediately available, although the union, in a statement, said it had achieved “major wins” for its members. GM’s most recent offer to the union included plans to invest $7.7 billion directly in U.S. plants, a person familiar with the negotiations told Automotive News. The total amount committed to GM’s U.S. plants would be $9 billion, including indirect investment related to battery-cell manufacturing in Ohio, the person told Automotive News.

Reuters reported GM’s proposal included guarantees to hire temporary workers to full-time positions after logging three years with the company. 

The deal also would create or retain 9,000 UAW jobs, Reuters reported. CNBC earlier reported that figure. GM in September said its initial offer would support 5,400 jobs — and a majority of those would be new jobs.

GM had also proposed 3 percent pay raises in the second and fourth year of the four-year pact, and 3 percent and 4 percent lump sum payments in the first and fourth year, respectively, Reuters reported. GM would reportedly offer full-time workers a $9,000 ratification bonus and temporary workers a $3,000 bonus, according to Reuters.

Prior proposals from the automaker have called for an electric pickup to be built at the automaker’s Detroit-Hamtramck Assembly Plant, and to retain carryover health care benefits that include a 3 percent cost-share for members. 

Union members are expected to hold ratification votes on the deal in the coming weeks.

“The number one priority of the national negotiation team has been to secure a strong and fair contract that our members deserve,” said UAW Vice President Terry Dittes, director of the UAW GM Department, said in a statement. “We are extremely grateful to the thousands of Americans who donated goods and helped our striking workers and their families. As we await the Council’s decision, please know that the outpouring of community and national support will be etched in the memories of all of us at the UAW for years to come,”

The union struck GM late Sept. 15. Analysts estimated the work stoppage cost GM about $1 million per plant, per hour. The union, facing the prospect of plant closings in Michigan and Ohio, sought greater job security, protections for temporary employees, wage increases and a quicker path to top wages for all workers.

‘Hopeful and confident’

“Today we’re feeling hopeful and confident,” said John Hatline, a 35-year skilled trades training representative at GM’s Detroit-Hamtramck plant. “We won’t know for sure until they roll it out to us and explain more, but as long as we can get something for the temporary workers, in-progression workers, traditional workers and people who are retiring, I think the contract will pass.” 

“People are upbeat,” said Hatline, 64. “We’re also suspicious. We’ve been suspicious of General Motors for years so until we actually see the contract and what’s inside of it I really can’t say what our membership is going to do

“What’s important for us outside this plant today is that we retain a product,” he said. “This plant was unallocated and scheduled to close. If we can retain a product here to keep our families fed and keep our people employed would be fantastic.”

Scott Ferguson, 65, a paint repair employee at the plant for 46 years said he believes the Detroit-Hamtramck plant will have product to produce after the strike.

“I’m assuming we’ll have an electric truck,” he said. 

GM, Detroit’s most profitable automaker in recent years, wanted greater flexibility to manage employment levels in the event of a downturn in the U.S. new-vehicle market. It also pressed the union to shoulder more costs for health care coverage.

GM CEO Mary Barra and President Mark Reuss met UAW leaders on Tuesday at main table discussions. It was the second time Barra was directly involved, after calling a meeting with top union officials the week prior to help speed up negotiations. 

“GM probably knew we’d be out about this long,” Ferguson said. “This is a big game, in a way.”

He added: “I feel good about the fact that we’re fighting this time not just for us at Detroit-Hamtramck, but fighting more for the middle class as a whole.” 

If members ratify the deal, negotiations would move to either Ford or Fiat Chrysler Automobiles. Representatives for both automakers have continued initial discussions with union bargainers while the focus was on GM.  

International impact

The strike has also impacted auto suppliers and thousands of workers in Canada and Mexico. 

Flavio Volpe, head of the Canadian Automotive Parts Manufacturers Association, said Canada’s supply chain will be back to work “as quickly as [GM] can get their assembly plants back up.”

“Everybody is frustrated.” he said. “You started with 30 plants and it infected all the plants north and south of the border.”

Volpe warned of the strike’s lasting impact when it comes to new investment in the United States.

“Certainly the UAW has shown it is willing to shut down one of the world’s biggest automakers for weeks,” he said. “That’s not something site selectors are going to forget any time soon.”

Hannah Lutz, Greg Layson, Sarah Kominek and Reuters contributed to this report.

This is a developing story and will be updated.



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