Global Fastener News

1998 FIN – GM Strike Caused Only Temporary Shutdown

February 03
00:00 2015

August 28, 1998 FIN – Fastener companies report little impact from the seven-week General Motors strike this summer and expect stepped up production will make up for reduced fastener sales during the work stoppage.
“We did not lay off,” Semblex Corporation president James Wittersheim told FIN. “Fortunately the strike coincided with our vacation schedule. It hit the perfect time for us.”
Semblex used the strike as an opportunity to reduce inventory, Wittersheim said.
Noting that GM represents about 14% of Semblex sales and is his largest customer, Wittersheim added that “I’m not going to say it helped us.”
He is glad the strike didn’t continue and cause serious disruptions for Semblex. “It is nice that they are back,” Wittersheimm expressed relief.

Dean Lamb, manager of marketing communications for Camcar Textron, said his company expects to make up any lost production and sales.
“As most of us who produce automotive fasteners, we felt a slowdown,” Lamb acknowledged. However, by “rearranging production schedules” Camcar avoided layoffs.
“We are hopeful we’re going to make up as GM ramps up, similar to what they did after a 1996 strike,” Lamb told FIN.

At the end of the first quarter Fastenal Company estimated that the GM strike had cut sales about $250,000 and that if the strike continued the lost sales would total a half million dollars a month.

Linda Williams of Illinois Tool Works Inc. investor relations said the initial indications are that the strike had a “minimal effect.” ITW reported no layoffs.
In addition to fasteners, ITW makes components such as door handles, welding equipment and industrial suppliers for the automotive industry worldwide.

Charles Griee, CEO of SPS Technologies Inc., said the automotive fastener group of SPS “had a strong quarter for booking new business, which more than offset the decline in orders due to the General M an estimated $75 million per day, or a total of about $2.5 billion.

But the analysts say the real costs to GM and the economy may not be as high as was once feared. Maryanne Keller of INF Baring Furman Selz predicted GM will recover as much as 40% of lost revenue this year through overtime and stepped-up production schedules.
Some economists say GM was building more cars than it was selling before the strike and thus actually helped reduce inventories.  ©1998/2015 Fastener Industry News.
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