GM, auto workers resume national contract talks

DETROIT (AP) - General Motors Corp. and the United Auto Workers resumed talks on a national contract yesterday as Canadian autoworkers overwhelmingly ratified a pact to end a three-week strike.

The Canadian Auto Workers held eight meetings in Ontario and Quebec to explain the tentative agreement to its 26,300 GM workers. The deal, reached Tuesday, was approved by 89 percent of those voting.

The final vote was 12,973 to 1,648.

In Detroit, GM's talks with the UAW continued, but there was no word from either side on how close negotiators were to a settlement. Analysts expect a deal within days now that the CAW contract has been ratified.

"It doesn't seem like there's a lot of controversy," said Nicholas Lobaccaro of Bear, Stearns & Co. "It doesn't sound like there's the threat of a strike right now."

The UAW and CAW are independent unions, but have coordinated their strategy in this round of Big Three contract talks.

While the strike against GM of Canada Ltd. was over, its effects were expected to keep rippling through the North American manufacturing operations of the world's largest automaker for at least another week.

GM said the number of workers in the United States and Mexico laid off because of the strike fell slightly yesterday to 19,159. A total 1,830 parts workers, mostly in Mexico, returned to their jobs while 1,058 new layoffs occurred in Mexico, and Mansfield, Ohio, and Flint.

There were no new slowdowns or closures of assembly plants, though third-shift workers at the Lordstown, Ohio, Pontiac-Chevrolet plant were told not to return to work tomorrow from their regular days off of yesterday and today. A GM source, speaking on condition of anonymity, said the entire plant may close this weekend, followed soon by the Buick City complex in Flint.

Plant slowdowns and last week's closure of the Cadillac plant in Detroit resulted from shortages of Canada-made parts. It could take two or three weeks for full production to resume as new parts are shipped from Canada.

GM stockpiled many parts, which drastically lessened the effect of the strike south of the Canada border.

Analysts estimate the fourth-quarter cost of the strike will be from $225 million to $350 million, depending on how much production is lost. That compares with the $900 million after-tax cost of the 17-day UAW strike at two GM brake plants in Dayton, Ohio, in March, which virtually shut down GM's North American production.

Analyst David Healy of Burnham Securities Inc. said lost production could total between 65,000 and 100,000 units, but that much of that could be made up with overtime in the fourth quarter.

The UAW and GM talked throughout the CAW strike and reached agreement on many issues, sources say. But the UAW held off on the final push to work out remaining details while it waited for the strike to play itself out.

"The UAW and General Motors are very, very close to signing an agreement," said analyst Ronald Glantz of Dean Witter Reynolds Inc. "I expect the UAW to sign within two weeks without any labor disruptions."

The key issue here, as in Canada, is outsourcing - farming out parts work to outside, lower-cost suppliers.

In its recent contracts with Ford Motor Co. and Chrysler Corp., the companies agreed to guarantee 95 percent of their current union jobs for the next three years, with major exceptions for productivity gains and an economic downturn.

Analysts expect the UAW and GM to agree to the same 95 percent provision, but with workers at several major parts plants that GM wants to sell excluded from GM's base work force number.

GM already has for sale two Delphi Automotive Systems plants in Michigan, in addition to two in Canada. The CAW agreed not to oppose the sale of the Ontario plants as part of its settlement.

The CAW is expected to initiate talks with Ford's Canadian unit on Monday.

10-24-96

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