DETROIT (CN) – The United Auto Workers announced they will go on strike Sunday night against General Motors in a move that will halt all its vehicle production in the U.S.
Talks broke down when the sides could not find common ground with wage increases and sharing the cost of healthcare. The union let its contract with GM expire Saturday evening. In a Sunday morning meeting in Detroit, 200 union leaders unanimously voted to strike.
“We stood up for General Motors when they needed us most. Now we are standing together in unity and solidarity for our members,” union Vice President Terry Dittes said in a statement.
General Motors touts a commitment to America on its labor news website. GM said they have invested more than $23 billion in United States manufacturing and accounts for more than one dollar of every four invested by U.S. automakers in the United States since 2010, citing a study from the Center for Automotive Research.
The website also states GM employs three American workers for every job in Mexico and the $90,000 a year average by hourly employees tops the median average salary by close to $30,000 more a year.
General Motors said in a statement that it is willing to increase wages and improved benefits to workers.
“It is disappointing that the UAW leadership has chosen to strike at midnight tonight. We have negotiated in good faith and with a sense of urgency. Our goal remains to build a strong future for our employees and our business,” the statement said.
A strike by the union’s 49,200 members means a halt to GM’s production across all its plants in the U.S., and would likely affect production in Canada and Mexico as well.
UAW members were expecting a salary increase for hourly workers. According to a report posted by the Center for Automotive Research, wages have fallen 2.1% since a high in 2010 with senior workers only receiving two 3% wage increases in 2015 and 2017.
Workers want a bigger slice of the profits that swelled to $8 billion for General Motors last year. The union wants pay raises annually to protect against the possibilities of a recession, but the company wants to pay lump sums tied to earnings in order to protect themselves in an economic downturn.
The union also demands the automaker keep four factories they are trying to close open and functioning, two are in the Detroit area, one in Lordstown, Ohio, near Cleveland, and another outside Baltimore. GM currently says it has too much U.S. factory capacity.
Health benefits are often a major point of contention between the groups and weigh heavily on the profit margins of automakers when vehicle sales cycle downward. An uncertain trade market and a push for tighter emission standards led by California could have played a role in complicating the talks.
“While we are fighting for better wages, affordable quality health care, and job security, GM refuses to put hard working Americans ahead of their record profits,” said in a statement Saturday night.
The strike begins as the powerful union is under intense scrutiny from a federal investigation inching closer to top leadership. The Detroit News reported Friday that UAW President Gary Jones and former president Dennis Williams are named in a criminal complaint alleging a vast embezzlement scheme where union funds were used for personal gain.