Supplier says plans paid more than rivals; GM to restart Hamtramck plant with new parts source.
Sharon Terlep and Eric Morath / The Detroit News
American Axle & Manufacturing Holdings Inc. said the United Auto Workers has rejected several wage and benefit proposals that are more generous than what its unionized competitors pay.
In a statement Tuesday, the Detroit-based supplier said tentative agreements had been reached on many issues but the UAW repeatedly rejected economic proposals that were "considerably higher than the market rate." It is the first time the company has indicated a willingness to pay more than its UAW-represented rivals.
American Axle did not provide details of the rejected economic proposals. The company said Dana Corp., Bharat Forge and other rivals pay $30 per hour in combined wages and benefits, and reiterated that it needs a package close to that or it may close its "uncompetitive" U.S. plants.
Executives have said American Axle's combined wages and benefits equal $73.48 per hour; union officials have said that number is in the $40-$50 range.
The union's latest offer is nearly double the market rate, the company said.
UAW spokesman Roger Kerson did not return calls seeking comment. Dana Edwards, shop chairman of UAW Local 235, which represents American Axle workers in Detroit, said there has been some improvement in the company's offer but not enough. "I wish they would understand our plight as much as they are asking us to understand theirs," he said.
American Axle Chairman and CEO Richard Dauch said the supplier "will continue to work in good faith to achieve a market-competitive labor agreement."
The development comes as General Motors Corp., American Axle's biggest customer, said it plans to resume regular production at its Hamtramck factory beginning Monday, a month after it was idled because of the strike at American Axle. GM is buying the parts from another supplier to build Cadillac DTS and Buick Lucerne sedans, according to sources familiar with production.
GM spokesman Dan Flores would not discuss the source of the parts for Hamtramck.
"We were able to secure enough parts to resume regular production," he said Tuesday.
The factory runs one shift, employing 1,550 hourly and 250 salaried workers.
It is one of more than two dozen plants idled or slowed by the American Axle strike, which began Feb. 26. Most build or provide parts for GM's slow-selling large trucks and SUVs, though GM on Monday cut one shift at an Oshawa, Ontario, plant that builds its high-volume Chevrolet Impala sedan.
The move to resource the parts could signal the start of efforts by GM to find other suppliers as the strike continues with no end in sight, said Jim Gillette, director of supplier analysis for CSM Worldwide in Northville.
The trade journal Automotive News reported last month that GM shifted a small parts contract, for Chevrolet Cobalt and Pontiac G6 cars, to Axle rival Dana Corp.
"When it starts to get to the point where it's affecting GM's bottom line -- at some point you don't have a choice," Gillette said.
A Dana spokesman declined to comment Tuesday.
Switching suppliers is difficult, especially given the massive machinery used to build the parts provided by American Axle. "There is some capacity in North America when you consider ... we were building 17 million vehicles in 2007 and now we're pushing toward 14 million vehicles," Gillette said. "There are suppliers out there."
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