The UAW Targets GM in Contentious Contract Negotiations
The current four-year labor contracts covering unionized workers at General Motors (NYSE: GM), Ford Motor (NYSE: F), and Fiat Chrysler (NYSE: FCAU) are set to expire on Sept. 15. With auto sales slowing in the U.S. -- but profits remaining buoyant in North America for the Detroit Three -- the current round of negotiations could be the most contentious in over a decade.
As expected, the United Auto Workers union recently announced that it had selected GM as its target as it looks to hammer out a new four-year pattern contract. The terms of the GM contract would serve as a blueprint for subsequent deals with Ford and Fiat Chrysler. With the clock winding down, there is a high risk that negotiations between the UAW and General Motors will break down, leading to a strike at GM -- which could potentially extend to Ford and Fiat Chrysler, too.
General Motors made itself the obvious target company for this year's round of labor negotiations with its late-2018 decision to idle several of its U.S. plants and discontinue various underperforming models. These plants have been underutilized in recent years, because of weak demand for the products they build. Closing them would unlock substantial cost savings for GM.
Source Fool.com
