GM Shutters 11 Plants Due to Supplier Strike

March 10, 2008
GM purchases more than 70% of the parts made by fomer subsidiary American Axel and Manufacturing Holding Inc. ,which has been on strike since Feb. 26.

General Motors Corp. on March 10 said it had shuttered 11 plants and trimmed production at 18 others because of a strike at a key supplier.

Many of the plants affected produce two of GM's best-selling vehicles: the full-size Chevrolet Silverado and GMC Sierra pickup trucks. Production of the hulking Hummer H2 and Chevy Tahoe has also been affected.

GM said last week that the strike has not affected sales because dealers have more than enough vehicles to keep up with customer demand for the next 60 to 90 days. However, an extended strike could have an impact on the automaker's bottom line because of the cost associated with temporary layoffs and the loss of future revenue should it not be able to make up lost production.

GM purchases more than 70% of the parts made by its former subsidiary American Axle and Manufacturing Holding Inc., which makes heavy axles, drivetrain and chassis systems and related components for light trucks, sport utility vehicles and crossover vehicles.

The United Auto Worker strike against American Axle began February 26 after the company and the union reached an impasse over management's demands for deep cuts in wages and benefits.

Copyright Agence France-Presse, 2008

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