UAW strikes at GM as talks for labor deal set to resume

DETROIT—The UAW declared a national strike against General Motors for the first time since 2007 as contentious negotiations over wages and benefits reached a stalemate.

The union said its roughly 46,000 hourly GM members walked off the line at 11:59 p.m. on Sept. 15. Local television stations captured the beginning of the walkout just after midnight.

"This is our last resort," Terry Dittes, vice president of the UAW-GM department, told reporters earlier Sunday following a meeting of the unit's national council. "It represents great sacrifice and great courage on the part of our members and all of us."

A union spokesman said it was a unanimous vote to strike. Negotiations are set to resume at 10 a.m. on Sept. 16.

The strike caught the attention of President Trump, who tweeted: "Here we go again with General Motors and the United Auto Workers. Get together and make a deal!"

A source with knowledge of the negotiations said many of GM's proposals came very late Saturday night and that the two sides are far apart on many issues, having agreed in principle on just 2 percent of what's in a normal contract.

Dittes, in a letter to Scott Sandefur, GM's vice president of labor relations, expressed disappointment with the late offer—describing it as GM's "first serious offer."

"Had we received this proposal earlier in the process, it may have been possible to reach a tentative agreement and avoid a strike."

GM said in a statement that its offer to the UAW includes more than $7 billion in U.S. investments, higher pay and improved benefits. The offer includes more than 5,400 jobs, the majority of which would be new.

"We presented a strong offer that improves wages, benefits and grows U.S. jobs in substantive ways and it is disappointing that the UAW leadership has chosen to strike at midnight tonight. We have negotiated in good faith and with a sense of urgency. Our goal remains to build a strong future for our employees and our business," the company said.

GM, without providing details, also said it has solutions for unallocated assembly plants in Michigan and Ohio. GM's offer also includes investments in eight facilities in four states and an introduction of electric trucks.

GM's offer to the UAW would allocate an electric truck to the Detroit-Hamtramck assembly plant and battery cell manufacturing to the Lordstown Complex, according to a person familiar with the matter.

GM also offered workers a signing bonus of $8,000 per member if they ratify the deal, plus wage gains or lump-sum payments in all four years of the contract. The carmaker says it's offering to keep members' health-care contributions the same as in the current contract.

"The union is playing some hardball. It seems they are pretty far apart," said Kristin Dziczek, vice president of the labor and economics group at the Center for Automotive Research. GM's offer "still doesn't address some of the union's demands."

Lost production may cost GM about $50 million a day in earnings before interest and taxes, Dan Levy, an analyst at Credit Suisse, wrote to clients.

"I want to be clear: this strike is about us," Ted Krumm, chairman of the union's UAW-GM national negotiations team, told journalists. "It's about standing up for fair wages, affordable quality health care, our share of profits, and job security. We are strong, we are ready. We don't take this lightly."

The Teamsters union said it would stand in solidarity with the UAW. A spokesman confirmed a Fox Business report saying roughly 1,000 Teamsters workers would refuse to deliver GM vehicles to dealerships as long as the UAW was on strike.

Fool me twice

GM already has spent much of the year battling with its union in Canada. Jerry Dias, president of Canada's Unifor union, fought GM over its decision last year to idle its Oshawa assembly plant near Toronto. After several weeks of protests, Unifor won an agreement from GM in May to establish an aftermarket operation on the site, salvaging about 300 of the 2,600 jobs at the plant.

"Workers have had enough," Dias said in a text message. "We gave so much and paid for our blind faith in GM. Things unfold as they should. Fool me twice, shame..."

Unifor also has been on strike against Nemak, a GM supplier, in Windsor, Ontario, and defied a Canadian court order to stop blocking access to the plant. But on Sept. 15 the union reached an agreement with the supplier and returned to work as of 11 p.m. EDT.

The UAW's previous four-year labor agreement with GM expired Saturday at midnight, but workers were told to continue without a contract under the terms and conditions of the 2015 deal. Units negotiating with Ford Motor Co. and Fiat Chrysler Automobiles have extended their contracts while GM talks proceed.

Roughly 850 UAW-represented janitorial workers at five GM plants in Michigan and Ohio struck at midnight, leading to confusion and frustration as UAW-represented assembly line workers crossed the picket lines of their union colleagues.

Corruption probe

The talks have been further roiled by an ongoing federal corruption probe. UAW President Gary Jones has been implicated in the scandal, according to reports. The union's International Executive Board called an emergency meeting the afternoon of Sept. 13, but Jones did not resign and it was unclear whether he was asked to.

A union spokesman declined to say whether Vance Pearson, the UAW Region 5 director charged last week in a federal corruption probe, was still on the union's International Executive Board. When pressed further, he said members in Region 5 were being represented by the leaders that were elected. He remains listed as a board member on the UAW website.

The spokesman said he would talk only about the workers and their fight for fair wages, affordable health care, share of GM profits, job security and a path to permanent employment for temporary workers.

"I will not deviate from that," he said. "This union is standing up for our workers."

While the union struck GM and Chrysler in 2007, the walkouts lasted only a few days. The last prolonged national strikes occurred against GM and Ford in the 1970s. GM workers went on strike for 67 days in 1970, while Ford workers were off the job for 28 days in 1978.

The union has been bracing for a work stoppage for some time. UAW leaders earlier this year announced a 25 percent boost in the strike payments members would get, to $250 a week. That amount is set to rise to $275 in January.

The weekly strike pay goes into effect on the eighth day of a strike. UAW members would also receive healthcare coverage during a strike.

Workers who are actively on strike get strike benefits, while those idled because of lack of parts during a bottleneck strike would collect unemployment insurance and supplemental unemployment from the company.

GM has stockpiled high levels of new cars and trucks in recent months, meaning it would likely take a prolonged strike to dent sales of most vehicles.

The automaker has a 77-day supply of new vehicles, according to a report by Cox Automotive, placing it well ahead of the industry average of 61 days.

Bloomberg contributed to this report.