Health-care costs are a bigger headache for GM. Its workers pay just 4% of their medical costs, a pittance by the standards of corporate America. Like other carmakers, GM is desperate for them to foot more of the bill, which is swelling as workers age and American health care grows pricier. The same rising costs mean that many workers would struggle to pay for treatments out of pocket. But not all Americans will sympathise. The UAW’s battle on behalf of a blue-collar aristocracy, many of whom earn around $30 an hour, loses emotional appeal compared with McDonald’s burger flippers fighting for a $15 minimum wage or Uber drivers demanding the barest of benefits. (It doesn’t help that several UAW bigwigs have of late been convicted for corruption.)
For all its profits, GM is in a precarious state, too. Last year Ms Barra, a company lifer, unveiled a $6bn-a-year savings drive. It involved shedding up to 14,000 jobs and shutting factories in North America to focus on making high-margin Suvs and trucks, as well as developing electric vehicles and self-driving cars. She sees disruption barrelling down the freeway from rival carmakers but also tech firms investing in autonomous vehicles. To stop GM from becoming the next Studebaker, she is determined to curb the firm’s reliance on old factories and wants to be able to shift output up and down as needed by hiring temporary workers. That requires relations with the union to be more flexible than they have ever been, says Patrick Anderson of Anderson Economic Group, a Michiganbased consultancy. GM’s very vulnerability over the future of the vehicle reduces the union’s leverage.
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