American Axle Workers Come To Deal
After the long existing strike of the UAW workers at the American Axle & Manufacturing Holdings Inc., they went on a tentative contract with the motor parts maker on Monday, that would cut their wages by more than one-third.
A huge number of UAW workers went on the strike on February 26, of which 3,600 workers walked off their job in the wage-and-benefit dispute as the American Axle CEO Richard E. Dauch had threatened to move work out of the United States, if the company failed to win the wage cuts it has said it needs to remain competitive.
The strike caused a parts shortage for its major customer General Motors that accounts for about 80 percent of its business. More than 30 plants of the GM were affected by the strike. It is noteworthy that Detroit based American axle makes axles, drive shafts, stabilizer bars mainly for GM’s pickup trucks and large sport vehicles.
During the UAW’s strike, workers at GM plants also made a walk off their jobs. In order to begin the production at the plants, GM agreed to kick in $200 million to help end the dispute between the company and the union. As a result, the Detroit supplier American Axle and the UAW agreed on a tentative four-year contract late on Friday. The tentative contract would cut hourly wage rates to a range of $10 to $26 and offers up to $105,000 over three years in exchange for lower wages.
UAW President Ron Gettelfinger said that the deal was the best, bargaining team could do in tough circumstances. He explained the contract to the workers in a meeting on Sunday. But, the meeting was followed by anger and shouting as most of the workers were not happy with the tentative deal.
Ron Gettelfinger told a local radio station, "We started at ground zero and we tried to build back. It’s not an agreement anybody is touting as, ‘This is great.’ Absolutely not. It is not a good agreement."
Apart from wage cuts, according to the agreement , the company will run a voluntary buyout program. It will pay up to $140,000 for employees who leave. An early retirement program has also been included in the proposed contract.
The contract also stated that, the American Axle closes its Detroit and Tonawanda, N.Y., forge operations within a year and as far the axle plant in Buffalo, N.Y. concerns, it would close immediately.
GM shares rose 0.9 percent to $20.87 Monday, while American Axle shares fell about 5 percent to $21.42 in the New York Stock Exchange.
