South African car industry fears impact as union goes on strike | Business and economic news


Largest South African metal workers union calls for indefinite strike after salary talks with employers’ organizations fail.

South Africa’s largest metal workers union has gone on indefinite strike, seeking wage increases and threatening to block supplies of parts for making new cars and accessories, industry and union officials said.

With about 155,000 members organized in the sector, the National Union of Metalworkers of South Africa (NUMSA) called for a total shutdown of the tech industry on Tuesday after wage talks with employer bodies stalled and arbitration failed.

“We have no choice but to go on strike and withhold our labor indefinitely until the bosses give in to our just demands,” NUMSA said in a statement.

The union staged marches and rallies across the country on Tuesday, with thousands of attendees attending a march in downtown Johannesburg where protesters wearing NUMSA’s signature red colors held up placards that read: “An injury for one is an injury.” for everyone.”

NUMSA had aimed for an overall pay increase of 8 percent in the first year of a pay deal, and an increase equal to inflation plus 2 percent for the next two years. Annual inflation is currently about 5 percent.

The Steel and Engineering Industries Federation of Southern Africa had bid 4.4 percent for 2021, inflation plus 0.5 percent in 2022 and inflation plus 1 percent in the third year.

Lucio Trentini, chief executive at the federation which represents more than 1,000 companies, from small family businesses with fewer than 20 employees to large publicly traded companies, said a poll of members on Tuesday showed employee absenteeism rates of about 26 percent.

“And I fear…that number will grow as the strike continues throughout the week,” he told Reuters news agency.

NUMSA members march in Johannesburg indefinitely on Tuesday [Siphiwe Sibeko/Reuters]

Economy hit by COVID

Trentini said they were in contact with NUMSA to try to reach a “mutually acceptable” compromise and prevent a repeat of a damaging four-week strike in 2014 that lost the economy an estimated 6 billion rand ($398 million). output cost.

The smaller union UASA said it was voting members to determine whether they also support the strike action, with a final decision expected on Friday.

South Africa’s economy, including the export-oriented auto sector, was hit hard by the COVID-19 pandemic, leaving employers reluctant to give in to union demands for wage increases above inflation.

Auto sales fell about 30 percent last year for both the domestic and export markets, hitting major brands such as Ford, BMW and Nissan, all of which have local factories.

“We urge parties to quickly break the deadlock and avoid long-term damage and possible line interruptions to vehicles assembled in SA and abroad,” said Renai Moothilal, executive director of the National Association of Automotive Component and Allied Manufacturers, to Reuters.

Mark Roberts, a lead convener at the Retail Motor Industry Association, said that if NUMSA’s strike lasted more than a week, inventories could be affected.

Separately, the country’s largest trade union federation called on its members not to work on Thursday.

COSATU, which aligns with the ruling party of the African National Congress but is sometimes critical of its policies, has accused the government of economic mismanagement during the coronavirus crisis.

It aims to pressure policymakers to adopt a more lenient fiscal stance in next month’s medium-term budget.

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