GM to pay up to $200M to end strike

May 8, 2008 8:52:11 PM PDT
General Motors Corp. has agreed to kick in up to $200 million to help bring an end to a bitter 10-week strike at parts supplier American Axle and Manufacturing Holdings Inc. The automaker said Thursday in a government filing that the money would go for temporary payments to buffer reduced wages for the workers, as well as employee buyout and early retirement packages in the event of a deal.

About 3,600 United Auto Workers at five American Axle factories have been on strike since Feb. 26 in a dispute over the company's quest for lower wages and benefits.

The strike has crippled GM's production of pickup trucks and sport utility vehicles and hurt its bottom line. About 30 GM factories have been either fully or partially closed due to the strike.

American Axle and the UAW were still talking as of Thursday afternoon, American Axle spokeswoman Renee Rogers said.

"We are hopeful that GM's financial assistance to help fund the buyouts, retirement incentives and buy downs...will facilitate an expedited resolution to the international UAW strike," Rogers said. "It's been costly and disruptive. A quick return to work will be a win-win-win for everybody."

American Axle said in a separate filing with the U.S. Securities and Exchange Commission that the aid from GM is contingent on a quick end to the strike.

"We believe the offer will help bridge the gap between American Axle and the UAW and that they will be able to reach a mutually satisfactory agreement in the near future," GM spokesman Dan Flores said.

GM shares fell 30 cents to $21.10 in late afternoon trading Thursday while American Axle shares gained 38 cents to $21.75.