Motor company looks for alternative to retrenchments, but union says 200 may go
General Motors South Africa, one of Nelson Mandela Bay’s biggest employers, is on the verge of shedding jobs as a weakened economy has knocked the car giant and placed the motor industry under significant pressure.
The company has confirmed that it is in talks with its staff and unions and will be offering severance packages if no other solutions are found.
The news comes amid a national jobs bloodbath, with Statistics SA having said on Friday that the formal economy had lost 67 000 jobs in the second quarter – up from 15 000 jobs lost in the first quarter.
Union Numsa is to hold a meeting with its members today to discuss what the company has already put on the table.
Numsa general secretary Irvin Jim said GMSA planned to shed up to 200 jobs.
But the company would not confirm this figure.
Jim said if the negotiations deadlocked, the workers would down tools.
“We will be meeting with our members at GMSA’s Struandale plant at 11am [today],” he said.
“We have also been in contact with GM to arrange meetings with them.
“Depending on the outcome of these meetings, and the feeling among our members, we might not have a choice but to respond with strike action.”
Jim said the company was offering employees voluntary severance packages that had never been approved by the union.
Employees with fewer than 10 years’ service were being offered two weeks’ salary for every year with the company – a package that needed to be greatly improved before it could be accepted, he said.
“With the packages currently on offer, these workers will join the ranks of the unemployed and be impoverished within three months,” Jim said.
GMSA corporate communications manager Gishma Johnson confirmed that severance packages would be offered to employees if no other solution was found.
However, she would not give details of the packages.
“The economic weakness in sub-Saharan Africa markets has led to a decline in new vehicle volumes in these markets, including South Africa,” she said.
“As a result, we have no other option but to revise our production schedule.”
“We are therefore working with stakeholders to consider all alternatives, with voluntary separation and early retirement being preferred options to minimise the imour business and on our employees.”
Jim also attributed the potential job losses to plans to shut a production line.
The company said last year that it planned to stop the production of its Chevrolet products in Port Elizabeth.
GM said at the time it intended to concentrate all of its manufacturing resources at the Struandale assembly plant in the city on the Isuzu one-ton bakkie.
Johnson did not respond to questions about a planned shutdown of the production line.
The growing financial pressure on GMSA is in line with the latest new vehicle sales statistics released last month, which showed a strong decline in domestic vehicle sales, as well as in exports, compared to the same period last year.
According to the National Association of Automobile Manufacturers of SA (Naamsa), the new car market last month showed a decline of 14.4% compared to September last year.
GMSA said alternatives to retrenchments were being explored.
But Jim said none of the alternatives f ro m the union had been considered.
“We expect to be at loggerheads with GMSA come next week,” he said.
“We have made a number of suggestions that would save jobs, or preserve some jobs until the industry strengthens again, but they seem to be ignoring these proposals.”
One proposal was a “training layoff scheme” that would offer employees training in more than one field, giving them the opportunity to move to different departments within the plant if jobs were cut in their departments.
“This way, the company could retain people until the sector strengthens again, meaning they would not have to go looking for new employees when things start improving,” Jim said.