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New GM Strike Could Lead to Wide Shutdown

May 14, 1997|From Reuters

The third strike to hit General Motors Corp. in about five weeks threatened Tuesday to force a broad shutdown of GM's North American vehicle operations and affect other auto makers that buy GM electrical components.

In Warren, Ohio, about 8,200 members of the International Union of Electronic workers walked off the job at 18 plants operated by GM's Delphi Packard Electric Systems division just after midnight.

The plants produce vehicle wiring harness components and other electrical parts for nearly all of GM's North American-built cars and trucks. The harnesses are used to distribute electrical power and signals throughout a vehicle.

Analysts estimate that GM could begin shutting down factories by late next week. Much of the assembly work for the harnesses is done in Mexico, so GM probably has more inventory in transit but not immediately available for its factories.

In March 1996, a 17-day strike against two GM brake plants in Dayton, Ohio, forced GM to idle 26 of 29 North American assembly plants. The walkout idled more than 150,000 workers and slashed GM's profit by $900 million.

The issues keeping IUE Local 717 and GM from reaching a new local labor agreement, as with ongoing assembly plant strikes in Oklahoma City and Pontiac, Mich., involve job security. The union, among other things, has demanded that GM guarantee that it will not unilaterally move more jobs to Mexico.

Negotiations to resolve the dispute resumed Tuesday afternoon.

GM shares fell $2 to close at $56.75 on the New York Stock Exchange.

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