GM-UAW war must end before it destroys both
General Motors and the UAW need to step back and take a look at their long-term interests.
These two huge old institutions are killing each other with a focus on short-term interests. GM gets cheers from Wall Street each time it takes a nasty little local strike that costs it a few hundred million in profits but allows it to continue cutting jobs. The UAW is winning short-term skirmishes to add a few people here and there, even though the long-term outlook for those jobs is dark as a dungeon.
The UAW has a legitimate gripe: GM is forcing sweatshop hours on some workers. It's anti-family, and it's not sustainable. Meanwhile, GM argues that it can't give relief because sometime in the future it won't need new employees because of the clever new designs of future products.
The results: strike after strike in which some new jobs are finally promised, and GM continues to sink.
Look what's happening to GM and its employees:
In June, GM took just 28.4 percent of the U.S. market for cars and light trucks. That's just 1.4 points ahead of a resurgent Ford Motor Co., and only 5.5 points ahead of the combined Japanese automakers.
GM forever missed almost half a billion dollars in profit because of production losses to strikes in the first half. GM is missing a fairly strong market.
While cutting jobs overall, GM is still adding jobs to settle the strikes.
American customers don't have to return to GM after they've jumped from a GMC pickup truck to a Dodge. If the Chevrolet Malibu flops because of lost production or poor quality, there are plenty of Hondas, Toyotas, Fords and Dodges to take up the slack. Some of those GM customers will be lost forever.
While GM shows Wall Street its resolve to get lean, and while Steve Yokich, Richard Shoemaker and other UAW leaders show the lengths they'll go to add jobs, GM is sinking as a North American powerhouse.
In the long run, this series of labor battles is destructive for GM's workers, suppliers and dealers.
The age of electronics
Today's supplier hot spot is electronics.
If you don't make the electronics that go with your component, you'd better be hooked up with a company that does, because that's where the action is.
In the 1997 Automotive News ranking of the world's 50 largest suppliers, 26 rely on electronics for some of their business. About 15 percent of the value of a new car consists of electronic componentry. Electronics has displaced steel, long the leader in that category.