DETROIT, United States (AFP) — Some 73,000 workers at General Motors plants across the United States went on strike Monday after contract talks broke down over issues of job security and health care.
The strike forced the closure of at least one plant in Canada and could also affect plants in Mexico which supply parts to US facilities.
GM has been seeking concessions from labor as it undergoes a massive restructuring in the face of a steady loss of market share to Asian competitors.
Thousands of United Auto Workers (UAW) members streamed out of 80 plants 10 days after their contract expired, many holding signs reading "UAW on Strike" and joining picket lines.
It is the first strike at GM since 1998 -- when plants across North America were shuttered for 53 days and cost the automaker some two billion dollars -- and the first nationwide strike at GM since 1970.
GM has sufficient inventory of vehicles to meet short-term demand and significant cash reserves to cover the costs of a brief strike.
But a protracted strike, which most analysts see as unlikely, could be fatal for the largest US automaker.
The strike will cost GM about 880 million dollars a week, estimated Deutsche Bank analyst Rod Lache, who wrote that a long-term strike is unlikely given that the union realizes that "GM has never completely recovered market share it lost during prior strikes."
GM said it was "disappointed in the UAW's decision to call a national strike" and would "continue focusing our efforts on reaching an agreement as soon as possible."
The union, which had extended negotiations on an hourly basis since the contract expired September 14, said it would return to the bargaining table shortly and also hoped to reach an agreement quickly.
But union president Ron Gettelfinger blamed GM for engaging in "a one-way set of negotiations" despite the many concessions the union had already made in recent years to help the automaker recover from staggering financial losses.
"It was going to be General Motors' way at the expense of the workers," Gettelfinger told a news conference.
"As much as workers do, they can't do enough and as much as executives get they can't get enough," he said.
"Nobody wins in a strike but there comes a point when someone pushes you off a cliff."
Gettelfinger declined to discuss details of the impasse but he said the health care issue, while still unresolved, was not the main trigger for the walkout.
The problem was that GM was not willing to match the union's flexibility on health care with commitments to build vehicles in the United States in the future, he said.
"I don't think we need to get any clearer. It's about job security. It's about investment in new products and it's about economic issues that affect our membership," said Gettelfinger, who had avoided using the word strike until the day before the union's old contract expired on Sept. 14.
In a statement warning of the approaching strike, Gettelfinger said the union had made "extraordinary efforts" to help GM deal with its restructuring plan.
These included billions of dollars in health care concessions, accepting the loss of some 30,000 jobs, and halving the wages of workers at GM's bankrupt former parts subsidiary Delphi Corp.
But in a statement issued before Gettelfinger's press conference, GM hinted that more was needed.
"The bargaining involves complex, difficult issues that affect the job security of our US work force and the long-term viability of the company," GM said.
GM has been pressing the UAW for further concessions, including two-tier wages and moves to make it easier to lay off workers, sources close to the negotiations have said.
One of the chief stumbling blocks was a proposed voluntary employee benefit association (VEBA) that would assume responsibility for health care benefits of more than 460,000 GM retirees, limiting the costs to GM.
A main issue of union concern is preventing GM from shifting more production out of the United States, particularly production of low-cost small cars.
Negotiations at Ford Motor Co. and Chrysler LLC have been extended while the union focuses on reaching an agreement with General Motors.
Contracts at the Big Three automakers have traditionally been linked to produce near-identical agreements.
The union chose GM as its main target this year and plans to pressure Ford and Chrysler to accept the same contract it wins from GM.
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