GM's PE car plant closed

2014-07-05 06:00

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Cape Town - General Motors suspended production at its main plant after the strike hit parts supplies, the US manufacturer said on Friday, becoming the latest victim of the relentless labour unrest.

Violence erupted on some picket lines, as the wage strike by the National Union of Metalworkers of South Africa (Numsa) dealt a further blow to an economy damaged by a five-month walkout in the platinum industry that only ended last week.

It will also further unnerve investors, increasingly frustrated by the unremitting labour strife and perceptions that the government is unable, or unwilling, to rein in militant unions.

GM's suspension of output at its plant in Port Elizabeth showed the escalating impact of the walkout, after Numsa rejected an increased wage offer from the Steel and Engineering Industry Federation of Southern Africa (Seifsa).

"The plant has been shut since yesterday because of the parts supplier issues," spokesperson Denise van Huyssteen said.

Numsa's more than 200 000 members went on strike on Tuesday, a move employers say will cost the economy more than $28m a day in lost output.

Seifsa said it offered wage increases of up to 10% late on Thursday, revised from 8%. The union wants hikes of 12 to 15%, more than double the inflation rate.

"Regrettably, it would appear that we continue to be miles apart with the union," Seifsa chief executive Kaizer Nyatsumba said in a statement.

In contrast, Numsa boss Irvin Jim said on Friday he believed the two sides were "not very far from each other". Issues like a youth wage subsidy and the removal of labour brokers were key to a settlement, he told Reuters.

Other sticking points have been Numsa's insistence that any agreement should apply for one year, while employers want to lock down a three-year deal.

Read more on:    gm  |  seifsa  |  numsa  |  port elizabeth

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