Do we really understand how auto makers closing plants and cutting jobs affect people who are impacted by these actions? Some of the companies move the plants to Mexico or other countries because workers will work for less and it is cheaper to run these businesses in these countries. There is nothing wrong with moving the companies to other countries but the automakers need to keep the plants in America open as well. Whole towns have been abandoned because of automakers shutting down plants. Economies in these towns just could not survive when the auto plants closed down.
People lose their jobs, homes and in some extreme cases their families. It is traumatic for a person to lose their job—especially if it is the only job they have worked all their lives—it goes way beyond how it will impact the automaker.
Ford to Close Plants
Ford Motor Company was founded in 1903 by Henry Ford and 11 associate investors most notably John and Horace Dodge.He passed away on April 7, 1947 and left a great legacy; the second-largest U.S.-based automaker and the fifth-largest in the world.
Sources close to the contract reported that the Ford Romeo plant in Michigan will close its door. The 600 workers there, fortunately, will be offered jobs in a transmission plant about 15 miles away. So, the bad thing is the plant will close but the employees will not lose their jobs as a result of the plant closing. The employees will be offered a $9,000 dollar ratification bonuses. The plant is a plant that manufacturers engines for Ford cars.
If the employees do not take the job offers then they will receive very attractive buy out packages. The plant closure is a part of the deal Ford worked out with the United Auto Workers union and the union is working out deals with the three big automakers. If this particular contract is ratified then it will be the 5th closure the auto makers have agreed to with the union.
Another factor is if the agreement is ratified it would be similar or the exact same lump payments and annual salaries as the deal worked out with GM. The deal also involves 3% raises or 4% lump sum payments each year of the contract. Other positive factors of the closure will be that Ford will invest 6 billion dollars and either create or retain 8500 jobs in the United States.
Employees Affected
All is not rosy concerning the closure in Romeo some employees are not happy about the potential closure. Plant officials notified the plant workers 12 hours after a tentative agreement was reached. The news was not received warmly by everyone. Here is what one skilled tradesman had to say “People are shocked and very disappointed," said one skilled tradesman who has worked in Romeo more than 10 years. “We have a small workforce now but, at one time, we had over 1,800 people. We believe our union failed us and management wasn’t much help." He added, "We were once the best in the world, building the 4.6 liter V8 engine."
These are some strong words coming from this particular employee, so not everyone is happy with this potential closure. The workforce was at over 1,800 employees at one time and they are now at 600 employees so over time the company has cut 2/3 of the Romeo workforce.
The plant builds engines from high-performance mustang Cobra engines to F-Series pickup trucks. The work will distributed to different plants in the United States and none of the work will outsourced to other countries. This will help to save jobs in the United States.
One report says the will be no jobs lost but the company is offering a buyout to the 600 employees so the jobs will be lost if the buyouts are accepted. The Romeo closure is the only U.S plant that will be closed by Ford. Another Ford worker—who wished to remain anonymous because he was afraid of reprisal by Ford—asked why the Ford plant in Mexico is not closing.
He added that “"We have 200 people who probably could retire here, especially in the trades. They're older. I think, for some, they're ready to retire. If given the opportunity, they'll make the decision to go sooner. If they were going to wait another four years, they'd be glad to go in two."
Yet another Ford employee said the whole deal was handled professionally and with integrity so he was one of the Ford employees who was happy with the Ford plant closing. It just depends on which employee you give to.
GM Closing Plants
GM recently settled a strike with the United Auto Workers which lasted 40 days. It cost the company two Billion dollars and part of the deal is they will invest 7.7 billion in current plants, create new jobs, and shorten the length of time employees can reach the top rate of pay which is $32.00 an hour.
GM is closing 3 plants including a large assembly plant in Ohio in an agreement made with the union. The closures will cost thousands of employees their jobs. The company will also close two powertrain facilities in Michigan and Maryland that closed in November of 2019 but the closures had to be agreed to by the union and it was agreed by the union.
Oddly, enough GM is supposed to be the largest automaker in the United States but yet they too are closing 3 plants. There is also a parts plant in California that will be closing under the deal. There was a plant in Michigan that was supposed to close down but it was spared and it will not be closed. The plant will remain open so they can build an all-electric car for the company. There will be other plants that will be closing in the future but details of these closings were kept secret.
Conversely, the company said they will be creating 1,000 new jobs in Ohio because they will bring battery cell production. They also sold the Lordstown plant to Lordstown Motor Company a new company that will build electric pickups for commercial carriers.
Chrysler LayingOff
Fiat Chrysler is laying off 32 more employees at its Belvidere Assembly Plant bringing the total to 1403 employees as the company has moved to a two shift operation as their only product the Jeep Cherokee is falling in demand. Sales have dropped significantly. The 32 layoffs were in the administration section of the company.
The layoffs have affected two suppliers in the local area as well. The suppliers Syncreon and Android had to let employees go as well and the implication was because of the Chrysler layoffs the suppliers had to let employees go as well.
Here is another ramification that when an automaker lays off employees that other related industries will be affected and will have to lay off employees as well. So, when the autoworkers lay off employees and then there are all kinds of ramifications.
The employees at the plant must make the hard decision to either stay at the plant as temporary employees or relocate to other plants in Toledo and Detroit. Here is another repercussion of automakers closing plants and laying off employees; is the employees will either retained as temporary workers or they will have to relocate to other parts of the country to work.
This means they have to sell their homes and relocate and start life in a new community or a new state which will cause major upheavals in their lives. The kids—if there are kids—have to leave their schools and friends. They have to start in new schools and make friends all over again. Moving can be traumatic for children needless to say for parents as well.
There may be cases where families will have to leave family behind to relocate to other areas to stay employed by the autoworkers. One worker said he was 57-years-old and is thinking how am I going to be employable at my age. Some workers will be forced to retire early because of the layoffs.
Brian Pasch, 33, said this “I signed up to go back as a temporary worker,” Pasch said Tuesday. “It’s kind of like a waiting game on the transfers to Toledo or Michigan — they don’t know when that’s going to happen. I’d rather just get back to work.”
He said he chose this path because he does not know when the actual job transfers will take place. He also wanted to get back to work as soon as he could. He is hoping he can get 2 days a week of steady work this from the layoffs. He held a full-time position in the Chassis department. He is considering the transfers and he thinks that other employees will not take the temporary job offers.
