From south Korea to the US. The management of General Motors decided to make its new compact car in the US, after securing new pay concessions from the United Auto Workers (UAW). “No American carmaker has done this in 25-30 years” said Arthur Wheaton, professor at Cornell University’s School of Industrial and Labor Relations (ILR), pleased to see production back on the American soil. Indeed, Mark Reuss, GM North American President, announced that GM was investing $145 million at the Orion plant, near Detroit, Michigan. This investment is supposed to prepare for the reopening, next year, of the plant closed in November 2009, to make two new cars: the replacement of the compact, Aveo, and another, bigger, the Buick Verano. Mark Reuss bargained with UAW leader Bob King, for the wage cost reductions: 60% of the plant’s 1,550 employees will receive $28 an hour plus retirement and health insurance contributions. However, the remaining 40% will only make $14 an hour.
Mark Reuss bargained with UAW leader Bob King, for the wage cost reductions: 60% of the plant’s 1,550 employees will receive $28 an hour plus retirement and health insurance contributions. However, the remaining 40% will only make $14 an hour.
Until now, General Motors assembled the Aveo in Asia. Ford makes its own compact, Fiesta, in Mexico, and so does Chrysler. Indeed, wage costs are much cheaper in Asia or Latin America. General Motors is coming back to the US, probably encouraged by the
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