'The strike is being estimated to cost GM up to $100 million per day. Even if it lasts a month, that’s a tiny fraction of its $147 billion in 2018 sales.' OPINION
The most famous example is the 1936 to 1937 Flint strike that resulted in higher wages and the union being recognized for the first time as the sole collective bargaining representative of workers by GM. GM, -0.35% For the next 15 years, UAW strikes were relatively common and extremely successful, culminating in the Treaty of Detroit in 1950, which shaped management-labor relations for decades. Even today, worker strikes in most industries are still generally considered an effective tactic.
Why past strikes succeeded In “Wrecked: How the American Automobile Industry Destroyed Its Capacity to Compete,” sociologist Michael Schwartz and I looked at the history of labor relations and production systems in the U.S. and Japanese auto industry to better understand the decline of the “Big Three” auto makers — General Motors, Ford F, -0.11% and Fiat Chrysler FCAU, -0.81%.
During the first half of the 20th century, General Motors produced cars using a just-in-time delivery system called “flexible production.” The auto maker carried no stockpiles of inventory; it ordered vehicle components as it needed them. It also clustered its suppliers — which were often the sole source of key parts — around its American plants, where virtually all of its cars were built at the time.
The result of the current production structure is that while a national strike shuts down U.S. production, that is only a minor part of GM’s total capacity.
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