GM moves parts contract from American Axle
The five-week UAW strike at GM’s parts supplier American Axle prompted the North American carmaker to transfer a small contract to Axle rival Dana. Production of 30,000 prop shafts for GM’s small trucks should begin in a matter of weeks, according to sources at Dana. The strike stopped all of GM’s light-truck production in the US at seven plants, one of its passenger car plants is idling and now threatens a second car factory.
The move shows GM’s growing lack of patience with American Axle CEO Richard Dauch’s inability to resolve the strike, according to unnamed sources in an Automotive News report. North America’s biggest automaker can’t afford not to build its highly-profitable truck plants any longer, but the 30,000 prop shaft order is part of Axle’s current contract, on which it has the right of last refusal.
Dauch threatened to move his American Axle operation, which would affect 3,600 U.S jobs, to Mexico, so this isn’t likely to be the last we hear on complications regarding the matter.
The strike started as a result of American Axle asking the UAW for pay and benefit cuts so the supplier can stay competitive with others.
The latest plants affected by the strike include the Detroit-Hamtramck plant that assembles the Buick Lucerne and Cadillac DTS was idled last week, while the Lordstown, Ohio plant, where the Chevrolet Cobalt and Pontiac G5 are built could be idled by the end of this week. American Axle makes brake components for the four models.
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