By on March 19, 2010

Workers at the former Toyota-GM joint venture NUMMI have approved a severance offer from Toyota. Union officials won’t reveal the exact amount involved, and while the Detroit Free Press reports that workers will make a “minimum” of $21,175, the San Jose Mercury says the deal “gives an average severance package of $54,000.” Could it be that some union brothers are more equal than others? What the Freep leaves out is that $21,175 minimum applies to 300 of NUMMI’s 4,700 workers who are already on disability leave. Workers with over 25 years of experience will receive $68,500.

But the minimum payout is drawing fire from local union members, and several workers have said they will file grievances with the UAW. Toyota’s $281m severance pool was made available in the form of a “retention bonus,” and injured workers were not able to meet the attendance requirements for eligibility. “As soon as NUMMI found a loophole to screw people, that’s just what they did,” one worker told the Mercury. But that still didn’t stop 90 percent of the local from voting for the lesser of two screwings.

In any case, union officials refused comment on the situation, prompting anger from workers and a statement by NUMMI spokesfolks confirming that:

The UAW committed of its own accord not to further denigrate NUMMI or Toyota as a term of the shutdown agreement. In fact, the union negotiated and proposed specific language for that provision of the agreement

Now why would that be?

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28 Comments on “NUMMI Workers OK Severance Deal...”


  • avatar
    pgcooldad

    They should shut down a plant in Japan instead of importing 50% of the vehicles they sell here in the USA. Yeah, like that is ever going to happen.

    I am glad this plant is in California. It has contributed billions of dollars into Toyota’s coffers with all the vehicles they bought. Serves them right since Toyota is showing them how much they care about California’s workers. And let’s not deflect that GM left the joint venture, that is why they are closing.

    Again, shut down a plant in Japan and build what you sell here.

  • avatar
    Geo. Levecque

    Toyota is shifting product on some Models to there new plant here in Canada at Cambridge, Ontario, so Toyota is building vehicles for the North American Market right here in Canada, despite our current High Dollar value!

  • avatar

    As the big three was going down in flames Toyota claimed they would never, EVER, layoff without pay any of their US work force. Despite having workers since mid-2008 gardening, taking training classes, and doing other activities that doesn’t involve building cars and trucks, Toyota took the GM pullout as a perfect time to close NUMMI, and give 4,700 US workers their walking papers, reducing their US work force to about 27K to 28K (not including dealer and related jobs, with a total work force of about 167K after these closures). The indirect impact to the region is between 25K to 45K additional jobs.

    But when you look at the bigger picture, one can see the real reason why this is going on. NUMMI has capacity to build about 400K vehicles a year. The Corolla, Tacoma, and Pontiac Vibe were built there (The Toyota Matrix is built in Canada, as NUMMI has no provision for building right hand drive vehicles – it is a common misconception the Vibe and Matrix rolled down the same assembly line built by the same staff).

    If you take a look at the two year snap shot of sales for Toyota, based on year over year numbers, The Corolla and Tacoma have fared better in each of their categories (cars and truck/suv) than other Toyota models. In other words, Toyota isn’t sitting on a bunch of Corolla or Tacoma over capacity.

    But by pulling the plug on NUMMI, and sending Corolla production to Canada and shifting Tacoma production to Mexico, Toyota can make another $500 per unit.

    They’re going to need it. Between lawsuits, recalls, and negative PR, the butcher bill for not being a good corporate citizen (right or wrong, which I don’t care to debate, they’re wearing the label and they handled this PR nightmare horribly) is now run up to between $6 billion to $10 billion.

    With GM and Chrysler bankrupt the UAW is a non-entity now. However I think long term, as jobs continue to leave the country, as wages continue to depress one has to wonder, who exactly is going to be buying these cars as the middle-class continues to erode? I’m all for free trade, but we’re on a slow slide to being a nation of, “do you want fries with that,” shopping at Wal-Mart, and that scares the bejesus out of me.

    • 0 avatar
      crash sled

      With GM and Chrysler bankrupt the UAW is a non-entity now. However I think long term, as jobs continue to leave the country, as wages continue to depress one has to wonder, who exactly is going to be buying these cars as the middle-class continues to erode? I’m all for free trade, but we’re on a slow slide to being a nation of, “do you want fries with that,” shopping at Wal-Mart, and that scares the bejesus out of me.

      .

      Well, David, for a “non-entity”, the UAW is sure piling up a lot of debt onto my grandchildren’s heads, along with the rest of Government Motors.

      I think if you’re worried about the next generation, you might want to consider curbing the debt load piled down onto their young heads. They didn’t ask for it. Some of them can barely speak as a matter of fact, since they’re infants.

  • avatar
    tparkit

    This severance deal shows how the mugging of Toyota by Congress and Ray LaHood continues to bear fruit for the UAW.

    http://www.thetruthaboutcars.com/quote-of-the-day-were-not-finished-with-toyota/

    Toyota’s generosity at NUMMI won’t stop here. The salaried folks will get a nice chunk of cash, too. And I eagerly await the news of Toyota’s next round of caving-in (oops, I mean “reasonableness” and “concern”) in response to extortion by Washington.

  • avatar
    50merc

    If you read the San Jose paper’s article, you’ll learn the bye-bye pay is structured as “retention” pay worth $285 a day. That’s a pretty nice incentive to stay to the end. No wonder 90% of the union voted for it.

    The minimum of $21K goes to, um, “workers” who are home or wherever on disability leave. In effect, they’ll be paid a bonus for continuing to not work. One fellow, who has been gone since September due to a knee replacement, is angry he’ll get only $21K to never come back. One wonders if that was his plan all along.

    All my life I’ve heard that California is like paradise. Presumably, once the economy is again booming, new businesses will be latching onto ex-NUMMI workers at top wages.

  • avatar
    Steven02

    This severance deal is why Toyota is closing this plant. They don’t want to deal with the UAW anymore. This was the only UAW plant Toyota has. GM leaving is the excuse. I believe, over the past several years, productions has been at least 80% Toyota from this plant.

  • avatar
    crash sled

    I suspect that NUMMI plant was doomed, as Tundra sales in the US have never really taken off, and thus that San Antonio plant can easily absorb the Tacoma production. Dumping the UAW is icing on the cake, I’m sure, although it looks like Toyota is paying for that icing. But they’d likely be moving that Tacoma production in any event, no matter where it was and whether or not it was UAW-organized. It just so happened the Tacoma plant was in California. Too bad for the Calis, but welcome to the real world.

    This happens here in SE Michigan seemingly every other day, to Tier II’s and suppliers all around us, and outside of a lucky few UAW members and Detroit 3 management slugs, NOBODY gets those sweet buyouts. They just get fired. So pardon us if we don’t spend much time worrying about the poor UAW Local 2244 members out in Cali, who are all cashing those fat checks.

    • 0 avatar
      mikey

      Yeah I keep a copy of my “sweet,fat” check framed and hung right over my keyboard.

    • 0 avatar
      crash sled

      “Yeah I keep a copy of my “sweet,fat” check framed and hung right over my keyboard.”

      .

      And for every one of you UAW or Detroit 3 management slugs who have a framed copy of their sweet fat check hanging from their keyboard, there are probably 10 Tier I’s, II’s and suppliers’ people who got fired, with nothing, and don’t even have a keyboard to hang a check from.

    • 0 avatar

      Tacoma production is going to Mexico, Corolla production is going to Canada.

      The investment that Toyota made in the Tundra, Sequoia, and supporting V8 factory has turned into a $4.5 billion black hole. Capacity to build 250 units and sold 79K last year. Positively Detroit grade over-capacity that will probably never come back given the overall climate toward full-size trucks in general.

    • 0 avatar
      crash sled

      No, David, Tacoma production is going to San Antonio, as mentioned… not Mexico.

      http://pressroom.toyota.com/pr/tms/manufacturing/document/TMCreleaseNUMMI090827_FINAL.pdf

  • avatar
    mikey

    Toyota doesn’t give a rats ass about the USA or the workers at NUMMI. This severance package is a POS,but its the best that could be had from the likes of Toyota.

    As crappy as it is,the package is far sweeter than Toyota would ever cough up to one of the non union plants. The workers in those plants are very aware of this fact.

    I have said this before,and I will say it again. The Toyota transplants are ripe for UAW plucking. As soon as one goes the rest will fall like Dominoes. Hyundai and Kia will go next.

    Honda will be the only holdout, thier better managed have a better product. Above all they treat thier employees with respect and dignity.

    • 0 avatar
      JeremyR

      This severance package, well into the five digits, is far more than many workers in the auto industry–or any other industry–will ever see when they lose their jobs. And yet it’s “crappy” and a “POS”? This takes feelings of entitlement to a whole new level.

    • 0 avatar
      wsn

      I can understand, from the point of a (ex)UAW member, any severance package of less than $1M cash is a POS.

      But then again, Toyota is not funded by North American tax payers. This is as good as any non tax payer funded company can do. At least, they still got dignity and would not be as low as and as cheap as the GM/UAW.

    • 0 avatar
      CarShark

      I’d like to see them try. I have not heard much about Southern states trending more pro-union, especially after seeing two of the unionized Detroit 3 melt down recently. I’m sure they’re also well aware that the first plant to do so is the first one on the chopping block when Toyota restructures. That’s why flexibility is a good thing.

      Besides, it’s not like that GM cares any about the USA or their workers, or they wouldn’t have been so useless the past…forever.

    • 0 avatar

      @wsn reply:

      Nope. Toyota is not funded by US taxpayers. They did take out a three-billion dollar emergency loan from the Japanese government to keep ToMoCo afloat and floor financing going, so they got help from the Japanese government.

      But make no mistake about it, the good citizens of Texas, Mississippi, Alabama, West Virginia, Kentucky, Tennessee and Indiana sure do fund Toyota. In hundreds upon hundreds of millions in tax incentives and breaks to locate their factories there.

      The state of Mississippi and the folks in Blue Springs are feeling pretty damn screwed over by the Lazy T about now, and despite continued rumors that Toyota one day will start building Prii in Blue Springs, “when things get better,” with global over capacity around 30%, even after the NUMMI closure, “when things get better,” is a long, long way off. But hey, its OK, Toyota got big breaks to build the factory, promise the jobs, and not deliver. So who exactly is paying again?

      And when NUMMI shuts down and the support jobs go away, won’t the great citizens of California be paying for the secondary job losses, and the tax hit that comes with that?

      And the last I checked, Ford didn’t take one dime from uncle Sam, and the UAW is building their products that is on par for quality and design with the Japanese, minus the stuck accelerators of death of course.

    • 0 avatar
      crash sled

      “And the last I checked, Ford didn’t take one dime from uncle Sam, and the UAW is building their products that is on par for quality and design with the Japanese…”

      .

      And last time I checked, David, Ford had their hand stuck out begging for loan guarantees, same as the rest of the Government Motors beggars. Toyota didn’t do that, and by the way, your claims of parity in quality and design don’t seem to be confirmed by the customers, nor by the Detroit 3 themselves, as I’ve seen in their in-house presentations.

  • avatar
    mikey

    @ WSN.. So Toyota doesn’t consider tax breaks,when they decide where to locate thier new plants?

    Who picks the bill up for that eh?

  • avatar
    Omoikane

    Nothing new here. The UAW shills have no shame.
    GM contributed zero dollars to the severance deal despite the fact this was a plant they have owned for 48 years! The profit was shared 50-50 with Toyota starting 1984. And most of the time, the plant actually lost money.

    Before the ongoing smear campaign against Toyota, encouraging messages were coming out of Japan about having the Mississippi plant running full production (200k Corollas) starting sometime in 2011.
    There was even talk about the possibility of shutting down NUMMI for a year or two and re-tooling for Prius while the patent lawsuit would be sorted out.
    As a result of the sudden acceleration witch hunt, the Mississippi plant was put on hold again.
    And after Waxman’s and UAW’s circus, you can now be sure there is never going to be a Toyota plant in California.
    As for the eventuality of UAW getting into a Toyota plant – Toyota will close that plant the very next day, come hell or high water.

    • 0 avatar

      You’re kidding me? Right. Toyota has global capacity to build close to 10.8 million cars a year. Shut down NUMMI that capacity goes down to 10.4 million. They are hoping to build 7.5 million, give or take this year. That is positively Detroit grade over-capacity. Oh and before any mention of Toyota accelerator pedals of death was even whispered in the media, their over capacity situation was worse, moving only 6.8 million pieces of iron in the year prior.

      It’s the Toyota witch hunt’s fault? Shoot they can build 250K Tundras if they wanted to and they aren’t even at 40% capacity. Lexus sales are down almost 60% from 2008. And the year-over-year blood bath if you look at 2008 to 2009 to 2010 to-date sales continues.

      Toyota grossly over invested in not only overall capacity – but the wrong capacity. You’re completely rewriting history when you say Blue Springs was going to build Corollas. Wrong answer. Blue Springs was going to be building Toyota Highlanders. You have the Tundra factory in San Antonio. The new RAV4 factory in Canada that just went online, running one shift, barely.

      The days of 17 odd million cars being sold in the United States a year are OVER. It is never coming back. China is now the largest car economy in the world, 13.8 million last year and growing. In the next ten years we may very well be the third largest car economy behind China and India.

      But Toyotas production woes aren’t because of some magical witch hunt that started in November of 2009, it is rooted in incredibly bad decisions to invest in the wrong things (big, gas guzzling trucks and SUVs) while pretending to be a green company.

    • 0 avatar
      crash sled

      “You’re kidding me? Right. Toyota has global capacity to build close to 10.8 million cars a year. Shut down NUMMI that capacity goes down to 10.4 million. They are hoping to build 7.5 million, give or take this year. That is positively Detroit grade over-capacity.”

      .

      “Detroit grade over capacity”, David? Quite the bit of hyperbole, no?

      75% utilization, in the midst of carmageddon, isn’t even CLOSE to the Detroit 3′s levels of incompetence, in terms of capacity. They were lucky if they were at 75% during BOOM times.

      You’re right though, the industry’s main problem is overcapacity, both worldwide and in NA. Good thing we bailed out the Detroit 3. That should fix the problem, eh?

  • avatar
    Geo. Levecque

    If only the CAW and UAW where more democratic in there dealings with People and Owners of Firms, they might face a different outcome, but they are still mired in the old ways and if that continues, they will be on a downward slope in the History of the Union movement in North America.


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