By on March 28, 2012

Today, the Supervisory Board of GM’s ill-fated Opel division is meeting. For the first time, the unions are in the majority on the board. In addition to half of the seats in the boardroom being occupied by representatives named by labor, UAW boss Bob King is taking part in the meeting. It is unlikely that King’s vote will strengthen the labor side. King comes as an emissary of GM, where the UAW, through VEBA, owns 10 percent of the stock.  Representing the capitalist side of the equation, King will have to vote for job losses and plant closures. If not today, then soon.

Says Reuters:

“The gathering is expected to last into late afternoon. It is not clear whether management will submit a mid-term business plan, which would include plant closures, or focus on less sensitive issues such as the appointment of a new sales chief.

“All signs point towards escalation regardless,” said one source close to the board, who said plant closures would be the elephant in the room even if they weren’t discussed.”

Another UAW sympathizer is the chairman of the supervisory board: Steve Girsky. Girsky came on (the) board at GM as representative of the UAW’s VEBA trust. As the chairman of the supervisory board, his vote counts twice in case the board is deadlocked.

Sending Girksy and King into the battle in Europe was a smart move by Akerson et al.  Forced to vote against labor, Girsky and King will end up as cannon fodder in the intricate European labor dealings, which will weaken the position of the UAW.  German auto executives watch this with great amusement. One anonymous exec said today on the phone:

“With these guys pushing for plant closures, the UAW has become enemy number one with the European unions. They will be treated as traitors. There goes their last chance for IG Metall help in the South.”

Other moves are not so smart. GM leaked too early that Bochum and Ellesmere port will be closed. 7,000 jobs will be lost. A smart tactician would have known to keep this option open as long as possible. A seasoned source close to Bochum labor leaders told Reuters:

“GM won’t announce any plant closure today anyway, since they’d be crazy to give up their trump card. The moment they say which plants are safe, they can no longer play them off against each other in the hopes of extracting concessions.”

The trouble is: The closures of Bochum and Ellesmere Port have already been leaked, galvanizing the union side into a united front.

PS: 48 hours later, it was announced that Bob King will take the seat for the labor side.

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21 Comments on “UAW’s Bob King Will Fire 7,000, Close Two GM Plants...”

  • avatar

    Bochum and Ellesmere Port have been closure targets for years, even before the GM-FIAT partnership. I doubt there’s any real surprise there.

    Interesting scenario with Bob King voting in Europe, though. Should be interesting to see this one play out.

  • avatar

    This is a classic tactic that I used many times when dealing with unions during my career: union leaders alway want to play management, so when there are ugly decisions to be made…. let them.

    Here’s an example case: business is good so we’ve been working so much overtime that the union is complaining. We should start a second shift – this will mean less overtime but more union members: agreed. Some workers from day shift will have to move to second…it will mean an opportunity for promotion for some of them and everyone will get shift differential pay: agreed! Now the fun part – who will transfer to second shift since there aren’t enough volunteers? Answer: a joint panel is formed with the union and it is agreed that they will select the 100 workers who (must) get to go to the new shift. Management may only overrule because of disciplinary issues or lack of necessary skills.

    Shazaam! The union is the bad guy telling people they don’t care about your childcare problems. The added benefit is that for a while they are gun-shy of playing management.

    However, I see at the end of the article GM management has managed to screw up deployment of this tactic too. Come on guys!

  • avatar

    hows the ROI on union dues coming along guys and gals?

    • 0 avatar

      For the fat cats, it’s pretty good. For the plebes, not so good. So it is with the cannibalistic union economy (see also, the two-tier wage system in the UAW).

      But another perspective is that the ROI is pretty good for the duration while you’re sticking it to The Man.

  • avatar

    Maybe the euro unions will fall in love with Bob’s euro style haircut and demand one for their wages and work rules.

  • avatar

    This just shows how impotent the UAW has become. They can’t do much except help rearrange the deck chairs on the sinking ship called Opel.

  • avatar

    The UAW owning a big chunk of GM’s stock is probably the best thing to happen to both organizations.

  • avatar
    bumpy ii

    I feel sorry for that pen.

  • avatar

    The idea of a united labor / unions front, while it could be highy desirable for workers, it is rather utopical. There is no common European labor legislation and all labor negotiations and agreements in the various European countries where GM has plants have to be conducted locally.

  • avatar

    for years the UAW has tried to play ball with German unions to help organize workers at German-owned plants in the US.

    the German unions response was to ignore/decline the UAW.

    you reap what you sow….

  • avatar

    Of course, this could all go horribly sour (from management’s perspective) and the UAW and IG Metall might find common ground.

    Playing labour against itself works, for a while. Eventually, though, it paves the way for trans-national solidarity movements.

    • 0 avatar

      “Playing labour against itself works, for a while. Eventually, though, it paves the way for trans-national solidarity movements.”

      If this was true, then why does the CAW exist?

    • 0 avatar

      Ok. I’ll bite. Can you describe a situation where playing labor against itself resulted in a “trans-national solidarity movement”? Bonus points if that example is from the last half century.

  • avatar
    Felix Hoenikker

    This story reminds me of my first new car – a 1975 Opel Manta two door RWD with a four speed manual. As an employed, recent college graduate with not a lot of money, I had to choose carefully. The American compacts like Vega and Pinto were cheaper, but not very good values IMHO. The Japanese cars were better, but you had to deal with thinly disguised, white collar criminals posing as Toyota and Datusn dealers. I’m not making this up. The local Honda dealer in my town was convicted of torching his Chrysler store to buy the Honda franchise.
    That left the Germans. BMWs were way over priced, at least to me, then. One day, I saw an ad for an Opel Manta at a local Philly Buick dealership. I went down to check it out and was impressed by the build quality and the technology. This car had Bosch Jet K electronic fuel injection similar to Mercedes and Volvo. Also, the Opel met emissions regulations without a catalytic converter. I bought the car and drove it for seven very trouble free years until 1982 when I traded it in. In 1979 I went AWOL from graduate school and took a three week 7,000 mile cross country tour starting in Phila and ending up in Yosemite park in CA and back without incident when the car was four years old. It could cruse all day at 75 mph without breaking a sweat.
    The sharp rise of the German Mark against the dollar eventually killed US Opel sales, and in 1976 or 77, Buick replaced the German Opels with a POS Isuzu model. I saw the same problem at Saturn in 2009. They replaced their plastic paneled Ions with Opel sourced Astras. While the Astra hatch back was a nicer car than the Ion, it was way overpriced and didn’t sell. It seems that the Europeans can only sell high margin luxo cars in this counry because of their very high manufacturing costs. Now it looks like Opel will permenantly down size in Europe too unless the Unions find a way to cut costs so Opel can undersell their rivals and get back their market share.

  • avatar

    This has been going on for almost 40 years now. Unions push for higher nominal wages and legacy benefits. Higher pay means fewer jobs; therefore, union members must be dismissed. The blame corporate America.

    Unions are still living in the 1960s, when our only global competitor was a communist state that would never sully its people with capitalist jobs. If they don’t find a new business model, they will cease to exist no matter how much politicians try to prop them up.

  • avatar

    I love the phrase: “union sympathizers” it almost reads like “nazi collaborators” if you blink. Nicely done.

    So you read the future now? Your headline states as fact something that didn’t happen and, according to your own article, won’t happen. That’ll teach those union sympathizers!

  • avatar

    Funny how things change when you own a company, eh Bob?

  • avatar

    This is pretty funny, Bob King representing GM stock instead of any unions.

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