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Talk between the UAW and American Axle & Manufacturing has been more encouraging lately with greater hope of an end in sight. Despite the level of progress behind closed doors, several noteworthy developments have arisen in the past week, most notably that the Chevrolet Malibu will be affected by the strike as early as next week. American Axle supplies a rear suspension knuckle for the Epsilon-based Malibu as well as the Saturn Aura and Pontiac G6, which will affect production at GM’s Fairfax and Orion plants.
Despite the strike, GM has secured enough parts to resume temporary production at Janesville and Fort Wayne beginning next week. The Janesville plant produces GMT900-based SUVs and returns to work on 7 April 2008 following a week of planned downtime to lower the line rate. Production is currently planned to run for just one week with both shifts before supplies are diminished again. GM’s Fort Wayne plant builds GMT900 pickups and will return on 7 April 2008 as well, but with production planned for only two weeks running single shifts each week.
An interesting side development resulting from the strike is a strike notification from the UAW to GM to push along the agreement process with the local contract. Despite ratification of a national UAW contract, GM is still negotiating with numerous UAW locals at the plant level. GM’s Arlington plant has continued production despite the strike having sourced the necessary components from American Axle’s Mexican operations and could strike by the end of next week. Arlington builds GMT900-based SUVs and is the sole source for Escalade and Escalade ESV models in addition to the Two Mode Hybrid Tahoe and Yukon.
Production of the Hummer H3 at Shreveport was suspended in early March due to differing axles from the Chevrolet Colorado and GMC Canyon, which continue to run unaffected. The table below reflects an estimated daily production rate for the H3 independent of the other Shreveport-built products. If the strike continues through the week of 14 April 2008, CSM is projecting that GM will have lost nearly 200,000 units of production due to the strike.
Negotiators from American Axle & Manufacturing have provided the UAW with additional financial information for review and the company has also restored benefits to some affected UAW members. These actions have resulted in further discussions scheduled into the weekend which are aimed at resolving the impasse. Additionally, recent comments made by UAW head Ron Gettelfinger reflect guarded optimism, as he hopes that contract ratification will enable him to cancel a member rally now set for 18 April 2008 in downtown Detroit.
For questions, please contact:
Joe Langley
Senior Analyst, North American Vehicle Forecasts
joelangley@csmauto.com or +1 248 465 2832
Mike Jackson
Director, North American Vehicle Forecasts
mikejackson@csmauto.com or +1 248 465 2833
CSM Worldwide provides trusted automotive market forecasting services and strategic advisory solutions to the world’s top automotive manufacturers, suppliers and financial organizations. CSM Worldwide covers the global automotive environment from Detroit, Grand Rapids, Frankfurt, London, Paris, Shanghai, Tokyo, São Paulo, Budapest, Delhi and Bangkok.