GM cuts continue, will the UAW still be “tone deaf”?

As reported by CNN/Fortune and the AP, General Motors has announced that over 10,000 salaried employees will be cut and the remaining salaried employees will take a 3% to 7% reduction in pay. The salaries of those in the executive ranks will be cut at least 10%. The expected effective date is May 1, 2009.
This will affect GM on a global level; previous cuts were felt only in the US. This announcement indicates that an additional 3,400 US employees are to be released, leaving the majority of the cuts to the global sales and manufacturing operations in Asia and Europe.
This round of reductions in staff and salaries, like others previously, are intended to qualify for government funding. Under the terms of the agreement, GM (and Chrysler) must show “positive net present value” or, in layman’s terms, positive cash flow that justifies the initial investment.
The UAW, ever the foil, has stated in the past that it will fight any attempt to reduce worker’s pay to the levels specified in the US government plan. At this moment, it is unclear what Rick Wagonner means when he says that “there’s good dialogue” with the union. However, what is clear is that the UAW is still clinging to the hope that they will get what they want without regard to the health of GM.
Mr. Gettlefinger, your conditional bluff has been called. You’ve said: “The union will do its part to help find savings as long as other stakeholders accept concessions.” I’d say that those “other stakeholders” are being forced to accept concessions. Big ones. If you are half as savvy as you think that you are, you will get out in front of this media wave and you’ll greet the world arm in arm with the GM management with a determination to get this program to recovery working.
I don’t think that’s going to happen. My guess is that the UAW leadership will reluctantly come to the podium, carp about the fact that they’ve been so put upon and then defeatedly say that they’ve given all they can give. Meanwhile, they will force Rick Wagonner to go back to Capitol Hill, hat in hand, to squirminlgy deliver the message that GM has not fully met the terms of the bailout loans.
I’ll say one thing that I like about President Obama: he is a gifted communicator. His choice of the term “tone deaf” to describe the automotive CEO luxury travel early in this process was brilliant. I will absolutely apply the same term to the short-arming, recalcitrant Ron Gettlefinger: he’s “tone deaf” about the state of his industry if he believes that these conditions are going to allow him to keep his “business as usual” paranoia about management and government and negotiate as if it’s 1999.

By continuing to use the site, you agree to the use of cookies. more information

The cookie settings on this website are set to "allow cookies" to give you the best browsing experience possible. If you continue to use this website without changing your cookie settings or you click "Accept" below then you are consenting to this.