Detroit Three, UAW Agree to Production Cuts

The United Auto Workers, under pressure from members concerned about threats to their health, said Detroit’s automakers have agreed to cut production by using rotating shifts intended to give them more cleaning time to keep the lethal COVID-19 virus out of assembly plants.

UAW President Rory Gamble said after a meeting with executives from General Motors, Ford and Fiat Chrysler Automobiles the automakers have agreed to trim production for the next two weeks to safeguard the health of workers.

Said FCA CEO Mike Manley in a statement: “I spent time today with a number of our employees in our assembly and stamping plants. I wanted to see for myself how we are implementing our new cleaning and workplace protocols, and be assured that we are putting their welfare first as we continue to support the effort to arrest the spread of this virus.” 

FCA said it will implement a series of shift pattern and production changes throughout its U.S. manufacturing plants.

“Ultimately this will pass, and when it does, it is important to me that we can say we worked hard with our UAW partners to provide the safest work environment for our people,” Manley said.

The FCA and UAW statements followed a three-and-half hour meeting Tuesday of a task force created over the weekend that includes Gamble, Manley, GM CEO Mary Barra and Ford executive chairman Bill Ford.

“All three companies have agreed to new measures that will increase adherence to CDC recommendations on social distancing in the workplace,” Gamble said.

Rory Gamble at Rouge 100 event Sept 2018 - Copy

Gamble (pictured, left) said rotating shifts will minimize risk. If a plant has operated on two shifts, it will switch to one shift with union members working on alternate days, union officials said.

“The companies also have agreed to work with us in Washington, D.C., on behalf of our members as we manage the disruption in the industry,” Gamble said.

UAW members have been pressuring the union’s leadership, which has been compromised by scandal. Local union officials have filed several health-and-safety grievances over plant conditions as the concern mounted, union officials acknowledged.

Under existing contracts, union members are allowed to strike if health and safety issues aren’t addressed in a timely fashion.

FCA said in a statement it will allow for greater separation of employees and further enhance sanitation protocols to provide a safe environment for employees.

“Despite the continuing economic turmoil caused by the COVID-19 outbreak, FCA continues to work on fulfilling a strong North American order book from both fleet and dealer partners,” FCA said.

Ford, meanwhile, was facing a shutdown of its critical Chicago assembly plant because of a parts shortage that was created by an outbreak of COVID-19 at a Lear plant that builds seats for Ford.

GM said, “We will continue to take aggressive steps to help prevent the spread of the virus and keep families safe” but did not offer specifics.

GM said it learned an employee who works at the Cole Engineering Center in Warren has tested positive for the virus, prompting the company to take steps to protect other employees.

“We have been in contact with the family and put our emergency response plan into action, building on the preventive measures we have already taken, which include directing employees at the Cole Technical Center and other sites to work remotely if possible,” the GM statement said. 

The production cut coming now could help prepare GM, Ford and FCA for an impending drop in sales brought on by the economic slowdown triggered by the pandemic.

ALG, a subsidiary of TrueCar, updated its 2020 new vehicle sales forecast, calling for a major downshift in car sales in what could be a long-term economic slowdown as the financial wreckage from the COVID-19 hits home. 

ALG forecasts a 14.2% decline in new vehicle sales, down 2.4 million units from ALG’s initial 2020 forecast and down 14.9% from 2019 sales.