GM workers worry about paying bills as strike continues

John Kirk, right, a 20-year-employee, pickets with co-workers outside the General Motors Fabrication Division, Friday, Oct. 4, 2019, in Parma, Ohio. (AP Photo/Tony Dejak)
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TOLEDO, Ohio (AP) — Nearly four weeks into the United Auto Workers' strike against General Motors, employees are starting to feel the pinch of going without their regular paychecks.

They're scaling back at the grocery, giving up on eating at restaurants and some are taking on part-time jobs while trying to get by on weekly strike pay of $250.

"In a couple of more weeks, I think everybody's going to be calling the bank or their creditors, going, 'Hey, probably going to be late or delinquent,'" said Mike Armentrout, who works at GM's transmission plant in Toledo.

While pressure is intensifying to reach a deal, the losses for both sides are mounting and spilling over into the auto supply chain.

Striking full-time workers are losing roughly $1,000 each week, and that's not counting the overtime many of them make.

Dolphin Green, a temporary worker at an engine and transmission plant in the Detroit suburb of Romulus, Michigan, took a job washing dishes at a restaurant to help make ends meet.

"I'm willing to sacrifice as long as possible," he said.

He's only been with GM for four months, making just under $16 per hour, but has hopes of going full-time so he can support a family.

Use of temporary workers has been a major issue in the contract negotiations, along with outsourcing work to other countries, a point that surfaced on Tuesday.

Green has cut spending and has a girlfriend with a good job. But he's worried about a child support payment coming up at the end of the month and has talked to his case worker about temporarily reducing the payments.

Dennis Earl, president of UAW Local 14 in Toledo, said the union is doing what it can to help workers by advising them how to deal with bills that are piling up.

The union hall's kitchen is serving meals around the clock and donations of food and household items are pouring in from other labor groups in the area. "Nobody's going to go hungry," he said.

"As this goes on and becomes more difficult, there's going to be some agitation, but for the most part these people are in it for the long haul," he said.

A Wall Street analyst estimates that GM has lost over $1.6 billion since the work stoppage began, and is now losing about $82 million per day. At some point, the losses will exceed what GM would save in holding out for more favorable terms from the union.

GM dealers across the country report still-healthy inventory on their lots, but they're running short of parts to fix their customers' vehicles, and some have had to cancel service appointments.

The strike immediately shut down about 30 GM factories across the U.S., essentially ending the company's production. Factories in Canada and Mexico remained open for a while, but one assembly plant in Canada and another in Mexico have been forced to shut down due to parts shortages.

Analysts expect the closures to spread to the few remaining plants that are open.

Many workers stocked away emergency cash after being warned for months by union leaders about the possibility of a strike, but they said GM's temporary workers who make much less couldn't do that.

"We all knew this was coming for a long time, I'm set up. A lot of guys aren't in that same spot," said Tim Leiby, an eight-year employee in Toledo. "I've got all my bills paid, but I know some people who don't."

Still, he's cutting back on eating out, going to the movies and spending money on hobbies because "we don't know how long this will last."

He also said he has a cousin who won't talk to him now because the strike has shut down the welding shop where she works.

"It's affecting everybody, it's affecting families. Even families that don't work here," he said.

The Anderson Economic Group, a consulting firm in East Lansing, Michigan, estimates that 75,000 workers at auto parts supply companies have been laid off or had their wages reduced because of the strike.

That doesn't include waitresses, convenience store clerks and others who are seeing their hours cut because striking workers aren't out spending money.

Truck driver Glen Hodge, who hauls scrap metal from a stamping plant in Spring Hill, Tennessee, has been off the job the past three weeks.

Since then, he's filed for unemployment, dropped his cable TV package, stopped going out to eat with his wife and even cut back on dog treats. It upsets him a bit when he sees gift cards and donations pouring in for the striking workers.

"What about the rest of us?" he said on Wednesday. "There's a bunch of us sitting around getting nothing."
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(Associated Press video journalist Mike Householder contributed to this report.)

Talks between General Motors and the United Auto Workers union hit a snag Tuesday over what the union says is a lack of commitment by GM to build new vehicles in U.S. factories.

In a letter to members, union Vice President Terry Dittes wrote that the union has told GM that it doesn't see a commitment from the company to a workforce that has helped make it billions of dollars.

"We believe that the vehicles GM sells here should be built here," Dittes wrote. "There is no job security for us when GM vehicles are made in other countries for the purpose of selling them here in the U.S.A."

GM did not immediately respond to a request for comment Tuesday night.

Although both sides were still talking, the union demand could be a major sticking point because GM produces pickup trucks and several SUVs in Canada, Mexico, China, South Korea and other countries, and imports them to the U.S.

Dittes wrote that GM's alleged lack of commitment is one of the union's top priorities in talks to end the strike, but little progress has been made.

"Economic gains in this agreement will mean nothing without job security," Dittes wrote, adding that the union is fighting for a middle class way of life.

In the past GM has said it has invested over $23 billion in U.S. factories since 2009, and has created more than 2,000 U.S. jobs so far this year. GM's U.S. factories built about 2 million vehicles last year, including 300,000 that were exported.

Just before the strike began Sept. 16, GM said it offered $7 billion worth of U.S. factory investments resulting in 5,400 new positions, a minority of which would be filled by existing employees. GM would not give a precise number.

A person briefed on the talks later said that $2 billion of that investment would be from joint ventures or parts suppliers that would pay less than what GM assembly line workers earn. The person didn't want to be identified because the talks are confidential.

On Sunday, the union voiced concerns in the talks about GM increasing production in Mexico, where it now builds pickup trucks, small cars and two SUVs. GM led all companies in automobiles produced in Mexico at just over 833,000 last year, according to LMC Automotive and the Center for Automotive Research, a think-tank based in Ann Arbor, Michigan. Of GM vehicles sold in the U.S., 22% are produced in Mexico.

The strike by 49,000 workers, now in its 23rd day, began Sept. 16, and immediately shut down all of GM's U.S. factories. Later two factories in Canada and Mexico were forced to close due to a lack of parts.

The strike has cost the company production of 165,000 cars and trucks and has passed the point where the GM can make up lost volume, according to auto industry analysts.

That means losses are starting to mount for GM even though its dealers have enough inventory to get by for several more weeks.

Talks also were hung up on hourly wage increases versus lump-sum payments favored by the company, according to a person briefed on the talks. They're also haggling over pensions, faster wage increases for workers hired after 2007, and guarantees of new products for U.S. factories, said the person, who didn't want to be identified because the talks are confidential.

Fifteen of GM's 18 North American assembly plants have been shut down by the strike, including everything in the U.S. and one plant each in Mexico and Canada, according to Bill Rinna, director of Americas Vehicle Forecasts for the LMC consulting firm.

"Once the strike ends, it may still take up to a week to get the parts pipeline going again. So we are likely looking at a loss of well over 200,000 vehicles," Rinna wrote in a note distributed Tuesday.

Much of that production can't be made up, especially at factories that make popular pickup trucks and large SUVs that already were on three shifts per day before the strike, said Kristin Dziczek, vice president of the Center for Automotive Research, an industry think tank.

The strike has cost GM about $1.6 billion according to numbers from JP Morgan analyst Ryan Brinkman, who estimates that GM is losing $82 million per day.

Strikers, meanwhile, are in their fourth week without earning a full paycheck from GM of around $1,200 per week before deductions. Instead they have to live on $250 per week in union strike pay.

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