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Honda Crippled By Chinese Strike

Workers demanding wage, benefit bump to $340 a month.

by on Jun.01, 2010

A strike at a southern Chinese transmission plant has shut down production of the Honda Jazz subcompact, which is exported to Europe.

A rare strike has crippled Honda Motor Co.’s growing Chinese production operations, despite efforts to fire or coerce workers who’re hoping to boost their $230 a month  wages.

The walkout was launched on May 17 at a parts plant in the southern province of Guangdong at a transmission plant that supplies Honda’s auto assembly operations in China.  The strike has cost the Japanese carmaker thousands of units in lost production, including versions of the Jazz subcompact that are shipped to Europe.

The walkout is unusual in that the official Communist-backed All China Federation of Labor Unions normally seeks to avoid confrontation with management.  Some workers at the transmission plant, which is located in the city of Foshan, claim they were physically assaulted by union leaders.  Others were reportedly fired when they declined to accept Honda’s initial offer.

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The Honda plant has a well-educated workforce, most of its line employees boasting college or 2-year technical degrees.  But the automaker has been able to hold down wages, in many cases, by bringing in many employees as “trainees.”

An early proposal by Honda, according to reports from China, would have offered the striking workers less than $2 a day to settle their grievances, but the latest offer, the maker said, would increase pay and benefits by 24%.  Workers had sought a 53% bump, to $340 a month, or 2,300 yuan.