GENERAL MOTORS IN MELTDOWN

GM Begins Closing 78-Year-Old Michigan Plant, Laying Off 335 American Workers

Bill Pugliano/Getty Images

JOHN BINDER

30 Jul 2019591

4:10

Multinational automaker General Motors (GM) has started closure of its Warren, Michigan, transmission plant, which has been up and running for 78 years, resulting in the immediate layoff of about 335 American workers.

Last year, GM CEO Mary Barra announced the automaker would stop production at four of its U.S. plants, including Detroit-Hamtramck and Warren Transmission in Michigan, Lordstown Assembly in Ohio, and Baltimore Operations in Maryland.

Already, the Lordstown Assembly plant closure has resulted in the immediate layoff of about 1,500 American workers, while another 8,000 workers in supporting jobs in the community are expected to be laid off as well. GM, though, is still hoping to sell the plant to another manufacturer.

This week, GM is beginning to shutter its Warren Transmission plant, a 78-year-old economic institution of the local community and region that currently provides work for about 335 American workers. Aside from the immediate layoffs, closure of the Warren plant — as well as the Detroit-Hamtramck plant — are expected to lay off 16,000 Americans in the state who work in supporting industries.

United Auto Workers members hold a prayer vigil at the Warren Transmission Operations Plant on February 22, 2019, in Warren, Michigan. Almost 300 people are being laid off at the plant as a result of GM’s decision to idle the Warren facility. (Bill Pugliano/Getty Images)

A number of Americans who worked their last day at the plant reminisced to the Los Angeles Times about their loyalty to GM, the disbelief that they are out of work, and the livelihood that working for the automaker once afforded them:

“It was a little somber. It was a little bittersweet when the last transmission rolled out,” said Jack Arnold, 49, who has worked on the assembly line for more than two decades. [Emphasis added]

“Getting a job at GM 23 years ago, for me, it was like winning the lottery,” he said. “I was trying to start a family. It kept my now ex-wife at home to raise the children. I was able to buy a house. We went to Disney World — all of that.” [Emphasis added]

…

“I’m too emotional,” said a 67-year-old woman who has worked for the company for four decades. She was among a group of women who prayed on the factory floor Friday morning. Others crowded around the last transmission to roll off the line — bound for a 2019 Chevrolet Impala — and signed it. [Emphasis added]

Earlier this year, Barra — who has continued to earn a nearly $22 million annual salary — laid off about 1,300 Americans at GM’s Warren Technical Center as part of a broader layoff, leaving about 4,000 workers without jobs. GM executives said so far about 60 of the Warren plant workers have been transferred to other jobs at the company.

While laying off thousands of Americans, GM is set to expand in China and South Koreaand is now the top automaker in Mexico where the corporation employs about 16,000 workers and keeps open four plants.

By 2023, GM executives have said they will produce 20 new electric vehicles, the vast majority of which are set to be made in China. Likewise, the 2021 Chevy Trailblazer is set to be made in South Korea and imported to the U.S. by 2020. The 2020 Buick Encore GX, too, is to be made in South Korea and imported to the U.S. for American consumers.

Experts have called on Trump to implement a 25 percent auto tariff to protect American autoworker jobs and the U.S. auto industry from Chinese domination. Likewise, Sen. Bernie Sanders (I-VT), vying for the Democrat nomination for president, has told Trump to immediately ban GM from receiving federal contracts for its outsourcing, offshoring, and mass layoff scheme.

American manufacturing is vital to the U.S. economy, as every one manufacturing job supports an additional 7.4 American jobs in other industries. Decades of free trade, with deals like the North American Free Trade Agreement (NAFTA), have eliminated nearly five million manufacturing jobs from the American economy and resulted in the closure of about 50,000 manufacturing plants.

John Binder is a reporter for Breitbart News. Follow him on Twitter at @JxhnBinder. 

Layoffs mount as slump in world auto industry deepens

The global downturn in the auto industry is continuing with warnings of further massive job losses ahead as sales continue to slump in key markets and companies are seeking to put aside cash to carry out research and development of electric and self-driving vehicles. The escalating trade tensions between the US and China are putting additional pressure on automakers.

The global character of the attack on jobs exposes the reactionary nationalism promoted by the unions and big-business politicians around the world including the US Trump administration. The threat to jobs is not a product of the trade policies of this or that country but the failure of the capitalist system itself, which is hurtling toward another major economic downturn.

Workers at the Suzuki Powertrain plant carried out a sympathy strike in October 2011 to support the workers at Maruti Suzuki's Manesar car assembly plant.

This week, a leading industry figure in India warned that the continuing sales slump in India could lead to as many 1 million jobs cuts in the auto components sector out of a total employment of around 5 million in the country.

According to Ram Venkataramani, president of the Automotive Components Manufacturers Association of India, passenger car sales in India fell 18.4 percent in the first quarter of 2019 and sales in June were at the lowest level in 18 years. The auto sector accounts for almost half of all manufacturing in India and the downturn in auto is a major reason for slowing growth in that country. About 35 million jobs are dependent directly or indirectly on auto production.

China, the world’s largest auto market, is continuing to see a sales decline, with new vehicle sales down 14 percent year over year in the first half of 2019. General Motors’ first-quarter sales fell 10 percent and Volkswagen 6 percent. The slump has erased 220,000 jobs, about five percent of the total, in the Chinese auto industry since July 2018.

The decline is having a serious impact on many automakers, with some expected to pull out of China altogether in the not too distant future. Ford auto plants in China, for example, were only running at 11 percent of capacity the first six months of 2019. Profits from sales in China account for a significant percentage of the pre-tax income for many major global car companies, including Audi (over 40 percent), Volkswagen (38 percent) and General Motors (23 percent).

Last week Japanese-based Nissan announced the elimination of 12,500 jobs worldwide, including 6,400 in Japan, the US, Britain, Mexico, Spain, India and Indonesia by March 2020. Another 6,100 will be cut in fiscal 2021 and 2022.

The slump in Asia parallels a downturn in auto sales in North America, with a Bank of America/Merrill Lynch analyst warning that sales could fall 30 percent by 2022. Ford, General Motors and Fiat Chrysler have all announced layoffs in the United States and Canada in 2019. In addition, about 2,420 of the Nissan cuts will hit plants in the US and Mexico. Earlier this year Nissan cut 381 jobs at its Canton, Mississippi factory when it eliminated a production shift.

This week GM closed its 78-year-old transmission plant in Warren, Michigan with the loss of 200 jobs. The plant, which as recently as 2006 employed 1,200, is one of five in North America the company has slated for closure by early 2020 at a total cost of 14,000 production and white-collar jobs. GM previously shuttered its Lordstown, Ohio assembly plant and is threatening to close two other assembly plants in Detroit-Hamtramck and Oshawa, Ontario.

Fiat Chrysler eliminated a shift earlier this year at its Belvidere, Illinois assembly plant and has scheduled the layoff of the third shift at its Windsor, Ontario assembly plant with the loss of 1,500 jobs.

Earlier this month, Ford in Canada announced it will lay off 200 workers at its Oakville, Ontario plant in September with the threat of further potential job reductions to come. The announcement follows a jobs bloodbath by Ford, including the elimination of 12,000 production jobs across Europe and 7,000 white-collar jobs in North America, 10 percent of its global salaried workforce.

Opel announced last week another 1,100 job cuts in Rüsselsheim, Eisenach and Kaiserslautern. In June, Ford effectively ended production in Russia, finalizing the closure of three factories.

The attack on jobs is being fueled by the incessant demands of investors for ever-higher rates of return in the midst of tightening market conditions. This requires squeezing ever-more production out of workers, rationalizations and the destruction of labor protections won over decades of bitter struggle.

A malignant feature of this has been the exponential growth of contract and casual labor, workers who are little more than pariahs, paid lower wages with few if any rights. Nowhere is this more evident than India, where contract workers comprise 70-80 percent of the automotive workforce, according to industry spokesman MS Unnikrishnan. The fight against contract labor was the major issue in the struggle of Maruti Suzuki workers at Manesar plant that led to the frame-up on bogus murder charges of the 13 leaders of the newly organized Maruti Suzuki Workers Union.

Terrified by the growing militancy of autoworkers, in June the Tamil Nadu state government invoked India's "essential services" legislation to effectively banstrikes in the auto parts sector.

In the US the use of part-time and contract workers has emerged as a major issue in the ongoing contract talks between the United Auto Workers and the Detroit-based automakers. There is powerful sentiment among rank-and-file autoworkers to convert part-time and contract workers into full-time employees with full pay and benefits while GM wants half its workforce to be temps.

A further assault on jobs and working conditions is anticipated with the increasing use of electric and driverless vehicles, which require fewer mechanical parts than gas or diesel trucks and cars. As one market analyst told investor website S&P Global, “(A)s demand for components related to internal combustion engines decrease, legacy suppliers will be forced to compete on a cost basis in a market of decreasing size to an increasing degree (even more than now) and this will drive benefits to scale players, which will force suppliers to merge over time.”

He noted that in his process “significant financial resources will be required and large and well-capitalized suppliers will have an inherent competitive advantage, again, likely forcing mergers and consolidation over time.” This has been reflected in a series of mergers and partnerships, including the recent alliance between Ford and Volkswagen on the development of autonomous vehicles and electric cars.

Mass Assembly at the Matamoros plaza during wildcat strikes in Mexico earlier this year [Credit: Esteban Martínez]

The assault on the conditions of the working class, which is not confined to auto, is meeting growing resistance. This was expressed by the recent strike of Faurecia auto parts workers in Saline, Michigan and growing struggles internationally, including a general strike earlier this month in Ecuador, mass protests in Algeria, Hong Kong and the US territory of Puerto Rico. Earlier this year a rebellion by 70,000 auto parts workers in Matamoros, Mexico cut off the supply of critical parts to US and Canadian auto factories.

Autoworkers around the world confront the same attack on their jobs, living standards and working conditions. That is why they need a global strategy to unite and coordinate the struggles of autoworkers across national boundaries.

The United Auto Workers, Unifor in Canada, IG Metall in Germany and all other unions are based on the reactionary and outmoded program of nationalism. Far from resisting the attack on jobs and living standards, the UAW and other unions are surrendering further conditions based on the bogus claim that if workers submit to the demands of their “own” capitalist exploiters this will save their jobs by undercutting workers in other countries.

Job cuts are not the result of unfair trade or foreign competition but of capitalism. As Karl Marx said in the “industrial war of capitalists among themselves” the “battles in it are won less by recruiting than by discharging the army of workers. The generals (the capitalists) vie with one another as to who can discharge the greatest number of industrial soldiers.”

In place of the corrupt, bureaucratic unions, workers must organize democratically elected and controlled factory and workplace committees to mobilize a fightback against the auto bosses. These committees would not start with the profit demands of corporate management but the needs of workers to secure jobs, decent wages and a safe and healthy workplace.

The fight to defend jobs poses the necessity of a reorganization of society. Against the right of corporations to close factories and devastate communities, workers must advance the social right to a job and decent standard of living. This is a political struggle, posing the need for the development of a political movement of the working class to unite workers globally in the fight for international socialism.