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VW, GM, Toyota Raise For South African Employees
South African automobile producers and a union representing thousands of auto workers have reached a deal on wages, ending a pricey eight-day strike. The Automobile Manufacturers Employers Organisation and union Numsa signed a three-year wage offer on Friday that will see employees obtaining a 10 percent increase this year, and 9 percent within the next two years.The unions had been seeking 15 percent wage hikes, more than triple the country's inflation rate.
The strike hit companies including Toyota, Ford, Volkswagen, General Motors, Nissan, BMW and Daimler. The stoppage led to lost production of about 17,000 vehicles, the employers group stated. South Africa's car industry, which the business stated accounts for about 6 percent to 7 percent of the country's GDP, produces about 420,000 vehicles a yr. About half of South Africa's auto production is exported to other African states, Europe and North America.
The strike has not stood out in the global context simply because employees in several major markets have sought wage hikes, feeling they have leverage after carmakers slashed personnel throughout the worldwide monetary crisis and are scrambling to man assembly floors now that demand has picked up. But some of the risks GM is needed to disclose to investors are a small more telling about where the automaker stands a year following bankruptcy.
They consist of less than robust internal financial controls, uncompetitive pay for senior management as a result of caps imposed by GM's government bailout, and the harm that GM's shrinking dealer body could do to U.S. sales and market share. GM said its plan to shrink its U.S. dealer network and drop several brands could undermine sales and market share.In the end of June, there were about five,200 GM dealers within the United States, compared with about five,600 at the end of 2009.
The automaker initially wanted to decrease the quantity of dealerships by about 3,600 to 4,000 over the long term. In 2009, GM terminated franchise agreements with a lot more than 2,000 dealers. But under a new federal law, GM agreed to reinstate more than 700 of them. Some dealers also have been reinstated via a federally mandated arbitration procedure.The company now intends to decrease the number of U.S. dealers to about 4,500 by the finish of 2010.
The strike hit companies including Toyota, Ford, Volkswagen, General Motors, Nissan, BMW and Daimler. The stoppage led to lost production of about 17,000 vehicles, the employers group stated. South Africa's car industry, which the business stated accounts for about 6 percent to 7 percent of the country's GDP, produces about 420,000 vehicles a yr. About half of South Africa's auto production is exported to other African states, Europe and North America.
The strike has not stood out in the global context simply because employees in several major markets have sought wage hikes, feeling they have leverage after carmakers slashed personnel throughout the worldwide monetary crisis and are scrambling to man assembly floors now that demand has picked up. But some of the risks GM is needed to disclose to investors are a small more telling about where the automaker stands a year following bankruptcy.
They consist of less than robust internal financial controls, uncompetitive pay for senior management as a result of caps imposed by GM's government bailout, and the harm that GM's shrinking dealer body could do to U.S. sales and market share. GM said its plan to shrink its U.S. dealer network and drop several brands could undermine sales and market share.In the end of June, there were about five,200 GM dealers within the United States, compared with about five,600 at the end of 2009.
The automaker initially wanted to decrease the quantity of dealerships by about 3,600 to 4,000 over the long term. In 2009, GM terminated franchise agreements with a lot more than 2,000 dealers. But under a new federal law, GM agreed to reinstate more than 700 of them. Some dealers also have been reinstated via a federally mandated arbitration procedure.The company now intends to decrease the number of U.S. dealers to about 4,500 by the finish of 2010.
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