In its worst labour stoppage for more than 25 years, GM has been forced to shut 25 of its 29 factories in the US, Mexico and Canada. The action by the United Auto Workers union was also damaging component suppliers and the steel industry.
Observers expected the negotiations to last through the weekend with little sign of either side backing down from their positions. But a GM spokesman said: "Our priority is to reach an equitable agreement as soon as possible, so that we can resume supply to our customers".
The dispute is centred on three brake-making factories in Dayton, Ohio. Workers there went on strike on 5 March in protest over company plans to buy in some anti-lock brake systems from the German supplier Bosch. The union is demanding that GM give the additional work to its members.
GM was forced to begin closing down operations at its other factories early last week as supplies of the brake units began to run out. The only plants still open yesterday were three in Mexico and a small factory in Michigan. There has been no impact on GM's foreign subsidiaries, which include Vauxhall in the UK and Adam Opel in Germany. Attitudes within the union hardened at the end of the week, when it was reported that GM was seeking to block workers laid off at all the other company plants from receiving government unemployment benefit.
Richard Shoemaker, the vice- president of the UAW denounced "GM's illegitimate attempts to deny (workers) benefits to which they are legally entitled". Noting that the original strike was limited to the Dayton factories, Mr Shoemaker added: "The decision to lay off thousands of GM employees was an action taken by the company, not the union."
GM has decided to challenge the union at a time of growing popular disquiet over the way large corporations treat their workers in search of maximum profits and share values. Meanwhile, the strike is believed to have cost the company up to $250m (pounds 165m).
Wall Street seems to be cheering GM for its hard stance. "I don't care about the effect this has on the first-quarter numbers," noted Joseph Philippi, a car industry analyst at Lehman Brothers in New York. "What's more important is that these guys run the business in the most efficient manner".
Brian Jones at Salomon Brothers was less sanguine, however. "What is starting to worry people is the longer-term impact and what this strike means for the September wage negotiations," he said.
GM is vulnerable to union action over supply sourcing because it buys only 35 per cent of its parts externally, whereas Chrysler buys 70 per cent and Ford 45 per cent.Reuse content