Union local tells GM Flint workers that parts shortages could disrupt production
Detroit — General Motors Co. said it is working to stave off any impact from the coronavirus crisis on its U.S. production, after a union local in Flint said parts shortages could cause production disruptions there and at two other plants.
A post on a members-only app by United Auto Workers Local 598 representing Flint Assembly workers said a shortage of certain components could cause disruptions at three GM plants: Flint Assembly, which builds heavy-duty pickups; Fort Wayne Assembly in Indiana, which builds light-duty pickups; and Arlington Assembly in Texas, where large SUVs are built. The Detroit Bureau first reported about the post on Friday.
The post, obtained by The Detroit News, says: “We had a much more in-depth report from the corporate material department about the impact on our parts supply. They have given up on their everything is fine message. In February, we have two parts that potentially will be impacted. They are both decal applications so we will build shy if we run out."
Come March, more significant parts, including trailer harnesses, could be affected, the post said. The Flint plant has been set as priority and GM "will sacrifice volume at Arlington and Fort Wayne to keep us running," the post said.
Trucks are an incredibly valuable portion of GM's lineup, with more than half of GM's North America revenue — about $65 billion annually — from truck sales.
Union officials at Local 598 in Flint, Local 276 in Arlington and Local 2209 in Fort Wayne could not be reached for comment Friday.
"We are taking all necessary steps to make sure our employees have the full support of the company," GM spokesman David Barnas said in a statement. "The situation is still quite fluid, but GM, other automakers and suppliers have begun the process of restarting vehicle and parts production in China. We continue to monitor our supply chain and are in close communications with our Tier One suppliers to attempt to mitigate risks to production in North America. We do not anticipate any impact on full-size truck production at this time.”
Automakers, including Ford Motor Co. and Fiat Chrysler Automobiles NV, are moving with caution as they slowly restart production this week and next week in China.
GM shuttered its 15 assembly plants in China because of the virus. It plans to restart production at those plants beginning Saturday. Next week, the automaker will halt production for two days at a South Korean plant so the parts supply can catch up.
Meanwhile, Fiat Chrysler said Friday it would halt operations at its assembly plant in Serbia due to a lack of parts from China.
Any interruptions to North American production as a result of the virus are expected to be minimal, analysts have said, since automakers have alternate suppliers lined up. Battery-electric vehicles would be the most affected because there's a limited number of battery makers.
The virus is expected to hit automakers' bottom lines this year. Auto sales in China, an already declining market, are expected to drop 50-80% in February as consumers stay in instead of venturing to dealerships.