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  Devastating News from the American Auto-Industry

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Unions shooting Themselves in the foot, and Their Workers' Families in the stomach!

Enrique Mora

Dear readers, I know how important the contribution of unions was at the beginning of the Industrial era to prevent abuse on the workers. Today though, my perception is that their mindset should switch to keeping our lapidated economy afloat. Job Security should be the main objective of the organized labor leaders. When you read the following notes from the SME daily briefing you will probably understand my great concern about what is today their behavior.

"American Axle strike expected to close GM plants.

In continuing coverage from a previous briefing, USA Today (3/28, 3B, Carty) reports that auto supplier American Axle & Manufacturing (AAM) is entering "its second month with much of its union-represented workforce on strike," and the impact is now affecting General Motors' (GM) car production.

        "GM confirmed Thursday that the strike will force it to idle the Detroit-Hamtramck assembly plant after Friday's lone shift, and a local union president in Lordstown, Ohio, said Thursday that his complex will be shut down on April 4," the AP (3/28, Krisher) adds. "Closing the Lordstown complex, which makes the Chevrolet Cobalt and Pontiac G5 small cars, could hurt GM the most since the cars are selling well due to high gasoline prices."

        Bloomberg (3/28, Ortolani, Green) points out that the "strike at American Axle, GM's largest source of axles, forced the automaker to stop or slow production at 29 plants that build pickup trucks, sport-utility vehicles, vans, engines and vehicle parts. About 3,650 UAW members at Detroit-based American Axle struck on Feb. 26 over pay and benefits."

        "American Axle has said wages and benefits run more than $70 per hour, about three times higher than at its competitors, and it will have to close plants unless it gets wage cuts to as low as $14 per hour," according to Reuters (3/27, Krolicki).

        American Axle CEO says outsourcing a possibility. The Detroit Free Press (3/27, Walsh) reported that, in response to the UAW strike, Dick Dauch, chairman and chief executive officer of American Axle & Manufacturing, on Wednesday said AAM has "the flexibility" and "the right" to outsource all of its business "to other locations around the world." Dauch added, "We will not be forced into bankruptcy in order to reach a market-competitive cost structure in the United States. If we cannot compete for new contracts in the U.S., there will be no work in the original plants," which are located in Detroit, Pittsburgh, and two New York towns. However, "Dauch insisted he has no intention of turning American Axle...into an offshore company." "

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