UAW officials said early Tuesday that is decision to summon its National Council to a meeting in Detroit was simply to update them on the state of negotiations, not that a new deal was near; however, now that GM CEO Mary Barra is at the table, reports are that the two sides are getting close.
Barra was joined by GM President Mark Reuss at the talks. How long they were involved isn’t clear, but what is certain is that two sides are making progress toward a new four-year contract. The UAW has been out on strike since Sept. 16.
According to Associated Press, the two sides have resolved nearly every issue with the exception of are faster pay increases for workers hired after 2007, apprenticeships for skilled trades workers, and the details of closing a joint union-company training center. The person also didn’t want to be identified because the talks are ongoing, the news outlet reported.
Neither side has offered official comment today about the status of talks or if they’re close to a deal.
Earlier, there was some excitement that a new deal could be close, when it was discovered the United Auto Workers summoned its General Motors Council leaders from around the country to Detroit for special meeting this week.
The official agenda for the meeting issued by the union calls for an a “Contract update and another agenda item to be determined.”
“I wouldn’t read too much into it,” said a source familiar with the progress of the talks but who is not authorized to speak publicly. “There is no tentative agreement,” they said despite a series of meetings during the weekend to review the details of a UAW contract proposal.
The 30-day long strike has reportedly cost GM as much as $2 billion. GM made more than $8 billion last year and has racked up more than $30 billion in profits in the past five years.
Meanwhile striking workers gave up an average of $4,800, minus their strike pay of $250 a week, which was upped to $275 starting this week. The UAW has been looking for ways to pressure GM to make a deal. The strikers were supposed to start picketing dealerships across the country this week.
Morgan Stanley Analyst Adam Jonas said in a note to investors that he believes GM has the upper hand in the strike.
“In our view, today’s concerns about lost unit volume, cash drain, potential credit downgrades and impact on suppliers and SAAR will at some stage flip to ‘tight’ inventory levels, replenishing dealer stocks and improved working capital. We do not expect GM’s 2020 outlook to be radically impacted,” Jonas said.
Morgan Stanley has an Overweight rating on General Motors despite the rising cost of the strike, putting pressure on both sides to end the walkout.