By on July 17, 2012

Brazilians are unhappy with GM. GM is cutting capacity and jobs at a Brazilian plant. This made the Brazilian government unhappy, because it had cut taxes on domestically made cars, in exchange for manufacturers maintaining the size of their workforce. It also made unions unhappy. They voiced their displeasure on Monday by going on strike, Reuters says.

The Metalworkers Union of Sao Jose dos Campos told Reuters that the strike had paralyzed production at the plant near Sao Paulo. A GM executive said it is not true:  “On the first shift, which is the most productive, we had enough workers to continue above half capacity” said Luiz Moan, GM’s head of institutional relations in Brazil.

Workers are flexing their muscle a day before the union meets with government officials in Brasilia, Brazil’s capital, to protest what they say are imminent layoffs.

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9 Comments on “GM Gets Brazilian Tax Cut, Then Culls Workforce...”

  • avatar

    GM Gets Brazilian Tax Cut, Then Culls Workforce – Well Not Exactly

    (Read the Reuters Report in its entirety. Below are details left out in this article.)

    The facility, like others in a country where a slowing economy has led to a glut of new vehicles in recent months, has struggled to adapt.

    Because the assembly line produces older models, the company could cease their production altogether.

    Investments in newer vehicles that would have gone to the plant have been redirected elsewhere in Brazil, Moan said, after earlier labor negotiations stalled in Sao Jose.

    Automakers in Brazil idled production lines and cut output by 9 percent in the first half of 2012 after weak demand and tighter lending pushed inventories to a nearly four-year high.

    Now manufacturers are watching July sales numbers to see if a June sales surge reflects a genuine recovery or a fleeting boost from government incentives.

    (It would seem GM is doing what other manufacturers are doing during a slowing economy. The devil is in the details)

    • 0 avatar

      Yep they are. The problem is that the gov tax break has given the auto sector a big boom in an otherwise slowing economy. The Unions in the state of SPaulo are the most difficult to deal with. The workers there get more than double their peers elsewhere in the country. This is a long-term trend. Much like America and elsewhere in the industrialized world, SPaulo is facing a de-industrialization as companies seek other states where the workforce is more pliable and the govs more accommodating.

  • avatar

    What a good name to be talking about this!

    Anyway, this is just posturing to extend the deadline of the break in taxes that was awarded back awhile (check on TTAC if you’re interested). All makers are running at full speed capacity and there are some cars you have to wait over a month to lay your paws on.

    GM is changing their line-up. The factories are just now coming on to produce. A good momment for the union to put pressure.

  • avatar

    My wife’s Aunt works for GM in Sao Jose dos Campos (“SJC”). I’m going to have my wife give her a call tonight & see if she can give us some more insight.

  • avatar

    Bertel Schmitt, I am Ashamed of you!!

    How DARE you not take advantage of this Glaring opportunity to make both a salacious and corny 7th-grade lady-parts joke out of this headline!!!

    GM Gets A Brazilian Haircut

    GM Waxes Workforce, Brazilian-Style

    Brazilian Workers Get Close-Shave, Courtesy of GM

    …, etc. etc. etc.

    Come ON, man! :D

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