UAW strike hits GM's popular Chevy Malibu

ByABC News
May 5, 2008, 11:15 PM

DETROIT -- A local strike on Monday at General Motors' Fairfax plant near Kansas City threatens production of one of GM's hottest-selling vehicles, the Chevrolet Malibu, at a time when the industry is struggling because of the sluggish economy.

Sales of the Malibu were up 40% in April compared with a year ago, and transaction prices on the cars are up 30%, the automaker says.

Disrupting production of a strong-selling, profitable model at a time of collapsing auto sales is "stupidity of the highest order" on the part of the United Auto Workers union, says David Cole, chairman of the Center for Automotive Research.

The Fairfax plant, which employs about 2,200 workers, makes the Saturn Aura sedan and is one of two plants making the Malibu. GM's Orion Township, Mich., factory also builds Malibus.

"We are obviously disappointed that UAW Local 31 took strike action at Fairfax Assembly," says Dan Flores, a spokesman for GM. "From a GM perspective, we remain focused on reaching an agreement in Fairfax and in Lansing/Delta Township as soon as possible."

Says Cole, "I have no comprehension of what's going on. One of the theories is that this strike was an attempt to get GM to step up to the plate with American Axle but that's nearing the end. So I don't know what's going on."

Also, production most affected by the American Axle strike has been that of GM's large trucks and truck-based SUVs. Sales of those vehicles have plummeted as gasoline prices remain high. The automaker said last week that it's taking advantage of the American Axle strike to keep production levels low to avoid creating overstocks.