GM strike closes another plant

THE EFFECTS of the strike at a General Motors parts factory in Lordstown, Ohio, spread yesterday, when another 4,200 workers were left idle at the factory in Wentzville, Missouri, which produces luxury models such as the Buick Park Avenue.

The strike, which involves 2,300 members of the United Auto Workers union at the Lordstown metal-stamping factory, began last Thursday to protest against GM's plans to eliminate 240 unionised tool and die-making jobs at the plant.

Negotiations were continuing yesterday, but 24,000 workers at five plants have already been laid off as a result of parts shortages, and a spokesman for GM said that at least one additional plant might be closed as early as today.

The use of 'just in time' manufacturing techniques means that many assembly plants carry small inventories and depend upon a steady flow of parts, making them prone to rapid shutdown if upstream factories cease production.

The strike has already hit the Spring Hill, Tennessee, plant where GM's high-selling Saturn model is assembled, and is resulting in losses of millions of dollars per day for the company.

Despite these losses, GM stock rose by dollars 1.125 to dollars 34.625 on Monday, and yesterday morning rose another 12.5 cents to dollars 34.75. Wall Street has taken the view that the showdown over job cuts is necessary for GM to regain its competitiveness.

GM has announced that it intends to source more of its parts from outside suppliers, and is in the midst of a cost-cutting programme, involving tens of thousands of job lay-offs, that has precipitated a running battle with the UAW.

Car industry job losses have become an issue on the US presidential campaign trail, particularly in view of plans for a North American free trade agreement between the US, Canada and Mexico, that unions believe will see even more jobs being lost to low-wage car plants in Mexico.