June 5

This Day in History

Automotive

Jun 5, 1998:

Autoworkers' union calls strike at GM parts factory

On this day in 1998, 3,400 members of the United Auto Workers (UAW) union walk out on their jobs at a General Motors (GM) metal-stamping factory in Flint, Michigan, beginning a strike that will last seven weeks and stall production at GM facilities nationwide.

In the late 1970s and early 1980s, after rising fuel prices had left the "Big Three" American car manufacturers reeling, the UAW had agreed to a series of concessions as a way of saving one of the three--Chrysler--from bankruptcy and help the other two--GM and Ford Motor Company--recover. Among these concessions were wage cuts, pay freezes and the elimination of jobs. By the late 1990s, however, years of improved profits had helped the union gain back the ground it had lost with those concessions, and relations between labor and management had subsequently become more adversarial again.

In the year leading up to the walkout in Flint, GM faced no fewer than seven strikes at factories across the country, mostly over issues of job security. In 1998, Flint was home to some 33,000 GM workers at 18 factories and offices--more than any other place in the country, but still less than half the number GM had employed in Flint in the late 1970s, when the company held more than 50 percent of the U.S. automobile market. Over the years, as its dominance weakened, GM had eliminated more than 40,000 jobs in Flint in order to streamline its operations.

At the metal-stamping factory where the strike began on June 5, 1998, the UAW argued that GM had broken a commitment made in 1995 to spend $300 million to upgrade the facility. A week later, 5,800 workers walked out of a Delphi parts plant, also in Flint, citing their concerns about GM's outsourcing of labor to non-union plants in North America and abroad. Before it was over, the 54-day strike in Flint stalled GM's operations nationwide and cost the company more than $2 billion, as other facilities waited for the parts they needed to manufacture the company's cars and trucks. Announced on July 29, 1998, the strike-ending agreement included concessions by both sides: GM promised not to close several of the striking factories and to invest $180 million in new equipment for one of them, while the workers agreed to changes in work rules, including a 15 percent increase in the required daily output of parts for some workers.

The 1998 strike didn't end GM's problems with the UAW: In September 2007, the union launched a nationwide strike against GM, with 73,000 workers walking out and halting operations in 30 states for two days until a resolution was announced.

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