To what lengths will foreign carmakers go to avoid having unionized workforces in their American plants? They often build their factories where there isn't a long history of unionized labor working for American car manufacturers and their suppliers. In cases when they put up plants that are near union strongholds, they are said to take advantage of laws that restrict hiring to nearby counties. While foreign automakers say this is to ensure workers get to job on time, the United Auto Workers (UAW) say that this is done to exclude unionized labor from working in foreign car factories. The Wall Street Journal recently highlighted the case of Honda building a new plant in Ohio. The video clip is above and an excerpt of the article follows:
When Honda Motor Co. announced last year that it was building a new plant amid the farms of southeastern Indiana, Hoosiers cheered. Then Honda announced in August that only people living in 20 of the state's 92 counties could apply for jobs -- a move that excluded most of the state's thousands of unionized laid-off auto workers.
Honda's unusual hiring restriction highlights an often overlooked aspect of the United Auto Workers union's declining power. While Detroit's big auto makers and their unionized suppliers have been slashing jobs, wages and benefits, foreign car companies have added U.S. plants and created thousands of new automotive jobs. Yet they have effectively kept auto workers with UAW membership cards out of their factories, hampering the union from gaining any foothold where the jobs are.
Of the 33 auto, engine and transmission plants in the U.S. that are wholly owned by foreign companies, none have been organized by the UAW, despite repeated attempts. Mainly, foreign auto makers have located plants in Southern states where the UAW has little presence and where right-to-work laws limit union power. When they have ventured into Northern states such as Indiana and Ohio, they have mostly chosen rural locations far from any unionized plants and UAW halls. The moves now are helping the foreign-owned plants begin to lower wage scales.
In the case of Honda's latest plant, in Greensburg, Ind., the company received $140 million in tax breaks and other incentives, at least $50 million of it in statewide funds. But the company wasn't required to consider all state residents for jobs.