A current labor strike in South Africa by 30,000 metalworkers demanding higher pay has affected the production of several carmakers in the country like BMW, General Motors Co. and Volkswagen. Castro Ngobese, a spokesman for the National Union of Metalworkers of South Africa, confirmed to Bloomberg that the strike has started and negotiations have broken down.
He added the NUMSA is waiting for companies to submit a revised offer. The union wants 14 percent annual wage increase alongside improved medical benefits and shift flexibility, according to NUMSA National Treasurer Mphumzi Maqungo.
The labor strike also affective operations at Daimler, Nissan Motor Co., Toyota Motor Corp. and Ford Motor Co. The National Association of Automobile Manufacturers of South Africa expected the strike to cost the auto industry up to ZAR700 million ($69.1 million) daily as it cuts vehicle output by 3,000 vehicles.
Lunga Ntsendwana, product communications manager for GM, told Bloomberg by phone that the around 80 percent of carmaker’s workers are on strike since Monday morning, adding that the striking employees have gathered outside GM’s plants in Port Elizabeth. GM’s South African unit builds Chevrolet cars and Isuzu trucks.
Dudu Mwelase, a spokesman for Nissan's South African unit, told Bloomberg said that their daily vehicle production of around 245 units is disrupted due to the strike. The auto industry accounts for nearly 7 percent of South Africa’s gross domestic product, according to the country’s Department of Trade & Industry. [source: Reuters]