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NewsTrucking

Volvo Trucks will lay off 3,000 workers because of UAW strike at Mack Trucks (with video)

Both companies get engines and transmissions from strikebound Maryland plant

The impact of a United Auto Workers’ strike at Mack Trucks will nearly double next week when Volvo Trucks North America lays off about 3,000 employees because of a lack of engines and transmissions that come from a Maryland plant the companies share.

A Volvo Group spokesman on Thursday confirmed the ripple effect of the 4-day-old strike on its New River Plant in Dublin, Virginia.

“We communicated to our employees this morning that NRV will stop production Monday because of the effects of the strike at our Hagerstown powertrain operations,” spokesman John Mies told FreightWaves. “This will unfortunately result in the temporary layoff of about 3,000 employees.”

First strike in 35 years

Mack Trucks employees went on strike Oct. 13 at six facilities in three states, led by the walkout of 1,900 workers at Mack’s assembly plant in Lower Macungie, Pennsylvania. More than 3,500 workers are on strike for the first time in 35 years. 

Mack and Volvo Trucks are both part of the Volvo Group of Swedish truck maker Volvo AB. That means a labor disruption at one company impacts the other because of shared facilities like the powertrain operation that employs 1,300 in Hagerstown, Maryland.

The UAW lists a host of unresolved issues, including pay, benefits and the future of Mack production in the United States. 

Mack has invested $400 million in its U.S. operations over the last decade, Mack Trucks President Martin Weissburg said. Mack and Volvo are the only heavy-duty truck makers that produce all their trucks for North America in the U.S.

The three-year agreement at Mack expired Oct. 1. The union and company continued talks under the 2016 contract until Oct. 13. Negotiations are set to resume on Oct. 22, Mack spokesman Christopher Heffner said.

“Prior to the strike, we presented a substantial offer to the UAW, which included significant increases in both pay and total benefits for our employees and their families,” Heffner said.

Supplier layoffs likely

The UAW reached a tentative settlement Oct. 16 that could end a month-long national strike affecting 49,000 workers at 30 General Motors Co. plants and facilities. The impact of the GM strike caused the layoffs of thousands of employees at suppliers across North America.

“Second Tier suppliers could be hit pretty quick,” depending on how long the strike lasts at Mack, said Art Schwartz, president of Labor and Economics Associates, who worked in labor relations at GM. He also teaches in the labor studies department at Wayne State University in Detroit.

Strike timing

The Mack strike coincides with a falling backlog of trucks in production queues across the industry. Both Mack and Volvo plan two weeks of downtime this quarter to address 10 consecutive months of lower year-over-year orders.

Mack Truck strikes picket outside a joing Volvo Trucks North America-Mack parts distribution center in Jacksonville, Florida on Oct. 14. The facility is one of six in three states affected by the strike. (Photo: Jim Allen/FreightWaves)

“I tell my students ‘You don’t go out on strike if no one notices you’re gone,’” Schwartz told FreightWaves. “If they were going to go out on strike, they may have picked a bad time.”

Contract expirations dictate the timing of labor actions. A year ago, the industry could not build enough new Class 8 trucks to meet demand.

“Given the industry has too much inventory and is on the cusp of rolling off the massive pace of the last six quarters, this would seem a not-too-fortuitous time to go on strike,”  Kenny Vieth, president of ACT Research, told FreightWaves.

GM-UAW influence

While not linked to the GM strike, the Mack negotiations could feel the influence from the tentative UAW-GM agreement. UAW members at GM would each receive an $11,000 bonus upon ratification of the new four-year agreement. They would receive 3% raises in two of the four years and lump-sum bonuses in the other two years. 

As part of the settlement, GM can close plants in Lordstown, Ohio, and Baltimore, Maryland, that had no future products assigned to them.

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Alan Adler

Alan Adler is a Detroit-based award-winning journalist who worked for The Associated Press, the Detroit Free Press and most recently as Detroit Bureau Chief for Trucks.com. He also spent two decades in domestic and international media relations and executive communications with General Motors.

6 Comments

  1. It’s truly sad to see people “fighting” to generally obtain more backed by faith fiat currency that is repeatedly debased ,especially during a time of “financial repression” .

    In my humble opinion …………

  2. Apples and Oranges I’m afraid. Volvo is partially owned by Geeley. A Chinese car company. The Chinese will not capitulate to pressure from a Strike. That would give the impression they are “loosing Face” and are weak. I’m afraid that the UAW member at Mack have forgotten who signs their checks,. Small hint, Its not GM !!!

  3. Correct !

    In 1999 Volvo Group began to refocus on heavy trucks and sold Volvo Cars to Ford in 1999 , then Ford sold Volvo Cars to Geely Holding Group in 2010 . Volvo Trucks / Mack Trucks & Renault Trucks are separate entities(subsidiaries) which are owned and controlled by Volvo Group ,not Geely Holding Group .

    In my humble opinion …………


  4. Interesting article on Business Insider today .

    Title : There’s a stark reason why America’s 1.8 million long-haul truck drivers can’t strike

    You should read it !

    The biggest excuse for truck drivers not being able to strike is :
    Quote:

    “In order for a movement like (Black Smoke Matters) to actually happen, you need the two things independent owner operators like myself do not have,” Epling told Business Insider. “That’s the luxury of time, and a whole lot of money.”

    WRONG !

    Number 1- OO”s cannot strike ! They can’t strike due to the law that states you are not “employees” , you’re a business and businesses “striking” would be considered to be equivalent to PRICE FIXING ! Therefore it is ILLEGAL for OO’s to strike !

    Number 2- THE PROBLEM is that you think that you need to “fight” in order to obtain a change ! YOU DON’T ! You need to be clever and create a REALISTIC PLAN along with a REALISTIC “LEGAL” STRATEGY to bring that prosperous plan into existence !

    It doesn’t take tons of capital per driver , and it doesn’t take truck driver time per se . What unfortunately takes time is getting it through your stubborn minds to unite amicably without the need to fight in order to obtain an ethical desire !

    You’re roughly 3 million truck drivers in the USA ! If only 1% of you united at first and pitched in $1 measly dollar per business day per month ie; $20 multiplied by 30,000 members equals $600k at the end of 30 freakin’ days ! Now multiply that by 12 months ! That’s $7.2 Million that you CAN OBTAIN collectively ONE PEANUT at a time too get your capital generating PLAN off the ground .

    A strike is a form of bullying . And all it will get you are pennies while costing you dollars aside from the aggravation you will cause , until the NEXT TIME ! A strike is not a permanent sustainable solution ! It’s old school ! It’s a temporary Band-Aid on a cancer ! A cancer ? Yes demanding more fiat based currency that is repeatedly being diluted . Fiat currency continuously loses its purchasing power unless you have a plan to multiply it which outpaces it’s diluted quantity/percentage !

    Assembling a like minded “frustrated crowd” and CONTROLLING it is a lot more easily accomplished in theory than in reality . Learn from history . Some turn out into riots . Some get comprised with anti protestors to disrupt the movement . Then more laws are created which will reduce your FREEDOM furthermore !

    And “if” the general public and economy suffers due to your “strike” , they(General Public & Government) will turn against you ! Truck driver reputation has been tarnished enough , we don’t need to add more fuel to the fire !

    Number 3 – The reason the BSM movement didn’t succeed from my perspective was due to its poor structure and lack of organization . They were advocating hatred , war , fighting , causing disturbances , disrespect , and they were not listening to their members . Furthermore the group was compromised . I certainly did not agree with the ways they were advocating to create change . They didn’t have a realistic solution . They simply wanted to cause an economic problem based on their grievances and push it into another’s hands to find a solution while they were telling and making gestures to the world to go F*** themselves ! That “group” was lead by hostility and a lack of class with zero diplomacy . Their demise was not due to being unrelated to a labour union . Their demise was due to their attitude and ill founded “plan” along with a lack of ethics , in my humble opinion .

    Number 4- Owner Operators are suppose to be “Business minded” . They should act as a “Role-Model” . Develop a business plan to counter their current monetary & political frustrations . They should form a “mastermind group” that will create a realistic prosperous business plan for them to follow and put into action . They should be pioneers rather than follow old school striking mentalities .

    And that “plan” should include PR(Public Relations) to help change the publics opinion concerning truck drivers . A strike would inconvenience the public . You don’t want to do that . You want the public to be your ally . After all , the public are “consumers” to whom you cater through your transport service . Their consumption is what offers you your livelihood . We wouldn’t consumer organizations to get fed up themselves and start organizing major boycotts without us . (wink)

    Boycotts are the only form of “strike/protest” that I do condone . It’s a form of protesting for change with your dollars without the need to protest in the street which would attract government retaliation . And if it’s well organized it can payoff tremendously .

    In my humble opinion ………….

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