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Temporary layoffs for 1,200 GM Oshawa workers as U.S. strike continues

OSHAWA, Ont. — About 1,200 General Motors employees at the company's assembly plant in Oshawa, Ont., have been temporarily laid off because of a strike in the U.S., with more job cuts expected soon.

The employees, who work on the Oshawa truck line, will still receive full wages while the strike by more than 49,000 GM workers in the U.S. continues.

Unifor president Jerry Dias said Wednesday he expects the second line at the Oshawa plant to also be disrupted because of a lack of parts from the U.S. as early as Thursday, which would leave all 2,600 workers at the plant off the job.

The plant makes the previous-generation Chevrolet Silverado and GMC Sierra full-size pickups. The Silverado is GM's top-selling vehicle in the U.S.

The strike has already halted production at the company's 33 plants in the U.S., affecting parts supplies for GM plants elsewhere.

Operations at GM's other Ontario plants in Ingersoll and St. Catharines aren't affected yet but could be next week, said Dias. Workers at those plants will still be compensated in a shutdown but not as fully as the Oshawa workers.

Dias says some other operations are also issuing temporary layoffs, including a trucking company in Windsor, but that the auto plants will be most affected.

"There will be an impact in some industries, but the key hit will be the GM plants here in Canada."

Parts manufacturers including Magna International, Linamar Corp, and Martinrea International did not say if their operations had been affected yet.

GM workers in the U.S. walked off the job for the first time in over a decade on Monday over issues including wages, health care, and job security.

Dias said it was impossible to say how long the U.S. strike might go on, but that the UAW president told him Tuesday that no meaningful discussions have happened since the strike began. He said a Unifor strike in 2017 lasted longer than expected.

"It's tough to say. Our Cami strike I thought would be a quick one, and it turned out to last the better part of a month."

UAW spokesman Brian Rothenberg said Wednesday the talks were moving slowly but progressing.

In a note to investors, Citi analyst Itay Michaeli estimated the strike is costing the company US$100 million per day in earnings. However, GM has enough inventory to supply U.S. dealers for 77 days at the current sales pace, although it's running lower on big SUVs, according to Cox Automotive.

GM and the union are negotiating at a time of troubling uncertainty for the U.S. auto industry.

GM is facing weakening sales, a deteriorating global economy and an unpredictable trade war as it tries to keep its labour costs in check through 2023. But workers want a bigger share of GM's healthy profits, which totalled more than $30 billion in the past five years.

 

This report by The Canadian Press was first published on Sept. 18, 2019.

With files from Associated Press

Companies in this story: (TSX:LNR, TSX:MG, TSX:MRE)

The Canadian Press