GM Offers $200m Bribes to End American Axle Strike
May 8th, 2008 5:23 PM
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It should come as a shock to no one that the AP is reporting (via Yahoo! News) that GM has agreed to kick-in up to $200m to end the strike at American Axle. In "a government filing" today, GM said the money would go for [s]bribes[/s] payments to make up for wage reductions for the employees, buyouts and early retirement packages. AA spokeswoman Renee Rogers said there's been no agreement between the UAW and AA. But the supplier is "hopeful that GM's financial assistance to help fund the buyouts, retirement incentives and buy downs… will facilitate an expedited resolution to the international UAW strike." In a separate filing, AA said GM's aid depends on how quickly the strike is resolved. Meanwhile, GM indicated they have enough money to "meet its needs," even though the strike has cut its liquidity by $2.1b. They didn't indicate from which bodily orifice they plan to pull the $200m.
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The other shoe has dropped. Does it set a precedent for other suppliers, though?
Another reason to buy a non-union built Honda next time.
Wasn't American Axle a spin-off of GM? So, "selling" an unprofitable set of businesses, or "spinning them off" has done exactly what for GM? Delphi? Check. (As in, GM sent several larges ones). American Axle? Check again!
Where is the money coming from? Why are they doing this???? AAM can supply parts out of Mexico for the time being. There is no need to give them money. Unless GM is afraid other plants will go on strike (Orion - Malibu, Lansing Grand River - CTS, Lordstown - Cobalt).