General Motors Lays Off Workers, Halts Some Production Due To Japan Disaster

DETROIT -- General Motors Co. on Monday is halting some production and temporarily laying off workers at a Buffalo, N.Y., engine plant, another sign that Japan's disaster is affecting automakers around the globe.

GM's Tonawanda plant in Buffalo makes four- and five-cylinder engines for the Chevrolet Colorado and GMC Canyon compact pickups, which are assembled at a GM plant in Shreveport, La. GM has shut down the Shreveport plant this week because of a shortage of parts from Japan.

GM spokeswoman Kim Carpenter Carpenter said Tonawanda has the parts it needs to make the engines, but it's not producing the engines because Shreveport doesn't need them.

She said GM doesn't know when production will resume at either plant.

Carpenter said 59 of the 623 workers at the engine plant will be affected. Workers will get around 75 percent of their pay while they're laid off.

GM hasn't said which parts are affected in Louisiana. Automakers tend to withhold such information for competitive reasons. GM uses a five-speed manual transmission made by Japanese supplier Aisin Seiki Co. in the Canyon and Colorado, but Aisin said last week that it has enough transmissions and parts to continue supplying GM and hasn't shut down any of its plants in North America.

So far, GM is the only U.S.-based automaker to be affected by parts shortages. Ford Motor Co. and Chrysler Group LLC said Monday that they haven't slowed production but are monitoring the situation.

Also Monday, GM slowed production of its Corsa compact car in Europe because of a shortage of parts. GM cancelled two of the three shifts at its Eisenach, Germany, plant and closed another plant in Zaragoza, Spain.

GM said last week it was cutting unnecessary spending companywide as it assesses the impact of production disruptions from the March 11 earthquake and tsunami in Japan.

Comments

[Heyman]

06:15 PM on 03/23/2011

Moral of this story? Make it here. In the United States. Less transportation. Less cost.

[Viper]

01:19 AM on 03/23/2011

Its not free or even fair trade if we dont do business like the rest of the world. We stand alone in our government non support for workers or industry.

A Japanese part maker has the following advantges even with their higher wages, better benefits (same is true for the EU, Canada, China and etc)..

1) They get interest free loans from the government (this is true around the world).

2) They have national healthcare and the cost (half of ours) is none of its cost is in the cost the goods they produce(this is true around the world).

3) The goverment gives them an 18% rebate on any thing they export.. so they can sell at even below cost and make a profit from the government rebate ( this is done every where in the world).

Add them up and they have at least a 30% pricing advantage and you wonder why we lost 80% of our industry and now the high tech that follows the MFG jobs.

Regards

[subdolphin]

09:33 PM on 03/22/2011

I wonder if any of the anti-union posters here could enlighten us as to how much an American worker would have to be paid to compete with slave labor in China or even India?
Remember, Mexico is now losing jobs to China.

[UpNorthGuyWI]

11:47 PM on 03/22/2011

Honda, Toyota, VW, Mercedes, Kia, are all hiring thousands in the USA. They want non-union workers (who get paid similar to UAW rates). They find the flexibility that union-free provides helps them stay competitive. They also have more productive workers, less negative workers, and are not bogged down in bloated unfunded union pensions.

[subdolphin]

12:16 AM on 03/23/2011

But I thought UAW pay rates were bad.
When the foreign owners took over the former GM/ Delphi plants in Saginaw and Flint MI, workers who stay on got their pay cut from around $28/hr to $16/hr. Is that what you mean by similar?
Come to think of it slaves in early America enjoyed 100% employment didn't they?...Just following your logic here.

[Viper]

01:00 AM on 03/23/2011

Again they are assembly line jobs.. they are a very small part of MFG about 300 bucks per car, or the amt they save on tarrifs by assembling here... NET zero for the country.

Toyota has said that if the UAW goes away they will cut wages.

Honda is much better and has always hired union workers also.

Mercedez in Germany is completely unionized ( union is on boards, has ownership) as in Japan and they have higher wages and they are not allowed to outsource anything that would result in a loss of jobs in Germany and Japan..

The world does not work like you think!

Regards.

[sophiemaki]

07:48 PM on 03/22/2011

do i feel another .."bail out".
why do we have to be reliant for parts..?????

[LibertarianJon]

08:44 AM on 03/22/2011

I wonder if Limiting the power of the UAW would prevent layoffs??? Hmmmm....

[RagingHawk]

09:01 AM on 03/22/2011

Probably, but no one wants to hear that. The UAW only has the power to drive jobs away, not create them. By artificially driving up the cost of labor, above what the free market would naturally bear, this only makes autoworkers overpriced, which is not sustainable in the long term. But if automakers insist on giving fat bonuses to executives, they just lose credibility: the pain has to be felt from top to bottom.

[bridge to somewhere]

12:35 PM on 03/22/2011

The great free-market race to the bottom. I can't wait till we're all worth $3 a day while the guys at the top rake in their $100M bonuses and continue to sell products at the same price.

[StJames]

09:06 AM on 03/22/2011

Care to explain just what the UAW has to do with parts production in Japan?

[stape45]

07:58 AM on 03/22/2011

This “global dependency’ thingy will always go against the increasingly-dependent USA.

[StJames]

09:07 AM on 03/22/2011

Yep...but it works just fine for the uber rich.

[stape45]

09:51 AM on 03/22/2011

Therein lies the problem.

[bgofca]

09:35 PM on 03/21/2011

maybe they can make more of those american car parts in the us instead of japan. I'm not against japan, but i get tired of people complaining about people buying toyotas, hondas, kias and hyundai and other foreign "made" cars. however, my hyundai was made in alabama and gave some us person a job.

[RagingHawk]

08:57 AM on 03/22/2011

Seconded. Makes me laugh when people say I should buy an American brand of car because they're built here, and when I point out that Honda Accords are built in Illinois or Toyota Camrys in Kentucky, they tell me that the profits made on those vehicles still goes to Japan. So what? I don't care if the profits go to Neptune, as long as it means thousands of Americans have good paying jobs.

[Viper]

12:22 AM on 03/23/2011

They are not made here.. they are just assembled here! Thats a couple of hundred bucks per car, less than the tarrif they save. Net zero for America. The biggest import is car parts for their assembly lines.

Regards.

[StJames]

09:08 AM on 03/22/2011

What Alabama is in the US?   ;-)

[wowme]

09:14 PM on 03/21/2011

Calling GM an american company is too much of a credit given

[UpNorthGuyWI]

11:49 PM on 03/22/2011

It is an Obama owned company that produces poor quality cars and trucks.

[Viper]

01:09 AM on 03/23/2011

PURE BS.. the ratings for Fords and GM are top notch now.

And it was US taxpayer owned company since we bailed it out. It went public, we sold the stock, got our money back and its making a profit for 1.5 years now and its only been 2 years. Its stock is at 30 per share.

Pls note that all those China products you buy are at least made by a 50% communist government owned company or up to 100%..

AirBus is government owned and we buy planes from them for defense, and the government and union have seats on the boards in Japan and EU companies and gives them interest free loans.

Regards

Regards

[April22]

08:54 PM on 03/21/2011

No mention of the number of people who have lost their jobs in Shreveport, LA.

Will unemployment figures continue to go down, as we have been led to believe?

[OzzieVoodoo]

08:37 PM on 03/21/2011

I love my Prius and love shopping at Wal Mart. The Prius runs better than anything General Motors could dream of building.

As far as Wal Mart. I have a family of 7 to feed. I shop where I get the best price and don't get a hoot where it is made or come from.

[bgofca]

09:36 PM on 03/21/2011

applaud you for the prius, but wish you shopped somewhere other that the walmart which hurts americans so much.

[Osapient1]

10:25 PM on 03/21/2011

Walmart hurts Americans so much??? Only if your aspirations are to STAY working at Walmart for your entire adult life...

[Viper]

12:33 AM on 03/23/2011

GM products and Ford now match the Toyotas. Some Toyotas have been built at GM plants for years by UAW workers as honda have also been built by UAW workers since 1976. .. and the VOLT is better than the Prius, other than cost.. but then your prius gets an 18% export rebate that reduces its price from the Japan Government as do all exported cars to the U.S. .. All other countries give 18% export rebates... but us. Toyota sells here at no profit, pays no taxes, sells at cost to get market share and the government them pays them 18%.
I have a GM vehicle and a Toyota. Both are excellant.

However I will buy now only the Big 3 going forward, just as you can only realistically buy Japanese cars in japan...


Regards

[KCate]

07:23 PM on 03/21/2011

A naive question perhaps, but you guys seem to know what you are talking about: Can we pass a law as China has done that says that if you want to sell in the US, you must employ some US workers. That happened recently in the pharma business where Pfizer (I believe) agree to set up manufacturing in China in exchange for access to their market.

[Osapient1]

10:28 PM on 03/21/2011

We can barely say that if you want to work in America, you must have legal documentation. A law could certainly be passed if it is in concert with current trade agreements, but like everything else, it would be "more honored in the breach than in the observance".
Nice thought though. Especially if there were strong enforcement mechanisms.

[Viper]

12:38 AM on 03/23/2011

The same polcies exit in the EU and in Brazil.. we are the pnly country w/o such policies and accoringly the one with the worlds largest trade deficits( larger than everyone else combined), dropping wages and almost no priavte sector job creation in the last decade.

They( the rest of the world) also have 18% export rebates and national healthcare which does not go into the cost of the goods... another 40% pricing advanatge.

Its not free or even fairr trade if the rest of the world plays a different game and they do. We have to play by their winning rules or go out of business. Repugs have chosen the later.

Saying we cant get back the jobs we lost, cant keep the jobs we have and cant create new jobs ( or even build bridges,dams, roads or trains).

Regards

Regards

[Mister Grumpy]

06:53 PM on 03/21/2011

Whose to blame for this?.......... It's those who made purchases using only price as the decision maker..........

Walmart is not the only company to employ the reverse auction to determine suppliers, but it was the first........ it's a process that forces US based companies to off shore their manufacturing facilities so they could continue to sell to Walmart at a price Walmart demanded......

So if you shop at Walmart.......... you helped destroy the US manufacturing base........... and the millions of lost jobs that will NEVER return...............

[johnnymainstreet]

10:53 PM on 03/21/2011

Mister Grumpy, you are 100% correct! I have been employed (mid management) at a few different corporations who sold their products to Walmart. As you stated, Walmart was the "first" company to employ "the reserve auction to determine suppliers". For those who are not familiar with the process, basically, Walmart dictates the price on a product that they intend to purchase from the seller (manufacturer). So, if it's a coffee maker, Walmarts will tell the suppliers that are bidding for the business, here are the specifications of the coffee maker and we have to retail it at $19.95 and we have to make X as a gross profit. So, we will only buy this coffer maker at a certain price(set by Walmarts) What happens is that the manufacturer is locked into the product specifications and is forced to cut the only cost he has control over and that is labor. So, guess what the end result is? 50 coffee maker factories spring up in Third World countries and thousands of workers laid off in the USA. That is why we need to stop shopping at Walmarts. Sam Walton must be spinning in his grave. He started Walmart with a "made in USA"mantra.

[MichaelMcKLA]

04:53 AM on 03/22/2011

$30 an hour manufacturing job lost, $10 an hour sales associate job gained. No wonder so many people have roommates.

[johnnymainstreet]

08:04 AM on 03/22/2011

Not to mention all the benefits, like health care and pensions that went down the drain along with the lost manufacturing jobs. It's no wonder that the middle class is on the edge of the cliff waiting to be throw over

[gerald4]

06:42 PM on 03/21/2011

General Motors does not need any more Financial Genius Type Master Criminals to manage their affairs.

Are there any more Lee Iacocca type people in that industry that could revive these sick Auto Manufacturing companies from their impending deaths? Is Lee Iacocca still alive?

CAN LEE IACOCCA BE DRAFTED INTO THE U S ARMY, AND THEN BE ASSIGNED TO HEAD GM BY THE US GOVERNMENT, IF HE IS STILL ALIVE?

Lee Iacocca was a mechanical engineer that knew how to design, market, and manufacture automobiles.

He supposedly fought the Ford financial MBA educated managers tooth and nail to let him build the financially successful Ford Mustang.

Later in his career he was credited with saving Chrysler from their MBA financial geniuses.

I tend to suspect that GM is probably managed by MBA financial geniuses that are experts at draining company assets into their own pockets, but know very little about making automobiles.

[Viper]

12:42 AM on 03/23/2011

GM was turned around very quickly and we got our money back, the stock is at 31 per share, they are making a profit. .Repugs said that would never happen.Always wrong. The only money we will not get back is the unsecured money that Bush gave to GM Bond Holders.. 20 billion. Iacocca was bailed out by reagan in the 1980s if you may recall.

Regards

[gerald4]

05:30 PM on 03/21/2011

What if I start a wind powered electrical generator factory in the USA?

What if I import wind driven electrical generators from China and then hire a couple of US citizens (or maybe illegal aliens) to remove the Chinese nameplates and then attach a new nameplate with my factory name, address, serial number, with "Made in the USA" on the nameplate in my factory, and then that product will be "Made in the USA"?

What if I make sufficient political contributions to a sufficient number of congressmen and/or hire lobbyists to have a law passed to require that only "US Made Products" be installed on all of the federally funded "Green Energy" projects, then I will be able to sell these wind driven electrical generators at any price that I desire, and the US unemployment statistics will not be changed.

If the US government objects, then I will have the wind driven electrical generators delivered to my factory without nameplates and then they will be parts for final assembly in the USA by Americans when US citizens add only the nameplate to each of the Chinese wind driven electrical generators.

[gerald4]

05:31 PM on 03/21/2011

I will pay the Chinese with freshly printed paper US dollars for these wind driven electrical generators, and the Chinese will then use my freshly printed paper US dollars to buy title to more privately owned businesses, factories, casinos, hotels, farms, land, ports, breweries, refineries, forests, ports, breweries and other privately owned wealth and other assets located in the USA that were created by previous US generations.

In many cases, various US companies did sent their technical people to the foreign plants to train the foreign workers to make the products that were developed in the USA. These actions transfered US technology to foreign lands!

Only extremely high import tariffs of 500%+ if our labor is five to twenty times as expensive) will make it economically feasible to manufacture any products in the USA. This has to apply to imported parts and assemblies also.

Additional import tariffs need to be also applied to overcome the lower environmental, lower electricity and lower labor manufacturing costs available in foreign countries. This will vary product to product, and I do not know how to quantify that differential cost.

[Skepticat]

05:54 PM on 03/21/2011

The big trick is to create dis-incentives to outsourcing rather than reward bad behavior.
Alternates to 500% tariffs, could be to:
1) have a stiff outsourcing tax which wipes out products
2) Require multinationals to employ US citizens here for decent pay on a scale proportional to their actual or desired market share - or lock them out of the market.
3) require these other countries comply with all the environmental, labor, quality etc standards that used to be enforced here.

[Viper]

12:55 AM on 03/23/2011

The largest wind generators being imported into the US are made by GE Germany. The goverment gives 18% export rebates like the rest of the wiorld. Thier wages are much higher, 7 week paid vacations and fully unionized with national healthcare and cap and trade.....

They weigh 50 tons, 106 ft wing span and power 1000 homes each.

Regards

[Leothelion33]

05:27 PM on 03/21/2011

I guess that means I shouldn't apply for a job with GM.

[gerald4]

05:34 PM on 03/21/2011

Or maybe you can apply for Mexican citizenship and then work for mexican wages in a Mexican General Motors factory that only hires Mexican Citizens to make engines to be installes into GM vehicles that are sold to US citizens.

[Leothelion33]

05:56 PM on 03/21/2011

Too far to drive. Gas prices you know.