This morning Ford joined General Motors to temporarily suspended production at one of its plants as a result of the wage strike by the National Union of Metalworkers of SA (Numsa). Numsa rejected the latest pay offer from engineering and steel sector employers on Sunday, saying black workers were still underpaid and threatened to widen its two-week old strike.
Industrial action by 220 000 Numsa members, which followed on the heels of a crippling five-month strike in the platinum sector, has already forced General Motors to close its assembly plant in the southern city of Port Elizabeth. Other companies affected are construction companies Murray & Roberts and Aveng, which are working on the construction of two major power plants for state power utility Eskom.
Numsa is demanding a 12-15% annual wage increase for its members and on Sunday rejected employers’ latest offer of a 10% increase this year, 9.5% in 2015 and 9.0% the year after that.
Numsa general secretary Irvin Jim said the union would not accept anything less than a 10% annual rise over three years at the very least. “While we are fully aware of the state of the industry in the metals and engineering sectors we are also very acutely aware of the miserable conditions of life of the majority of the black and African working class who … survive on extremely low, colonial and very inferior racist-inspired wages,” Jim told reporters. “We are making a very clear statement that the strike continues and we call on our members to intensify the strike.”
That could mean calling 100 000 Numsa members in other industries to join the strike as well. “Should the employers continue with their reckless shenanigans and unreasonable demands, we might be left with no option but to call for targeted solidarity in all our sectors,” he said.
The Steel and Engineering Industries Federation of South Africa (Seifsa), which represents employers in the sector, said it was disappointed with Numsa’s rejection of what it called its “very good final offer”.
“We have now done everything that we could possibly have done to end the strike,” chief executive Kaizer Nyatsumba said in a statement, adding that the Seifsa leadership had exhausted its mandate. Jim said Numsa was due to meet with employers again today. “Numsa’s militancy is a direct product of our rejection of the inhumanity of our work and super exploitative wages and conditions,” he said. “We remain committed to return to serious negotiations on the demands of our members.”
h3. Economy under Pressure
A continued or wider strike by Numsa would put further pressure on the economy, which contracted in the first quarter of the year as the platinum miners’ strike hit mining and manufacturing output. A four-week strike last year by more than 30 000 Numsa members at major automakers cost the industry around US$ 2bn. Ratings agency Standard & Poor’s cut South Africa’s credit rating last month while Fitch put it on negative watch, both citing poor growth prospects mainly because of strikes.
Analysts have long singled out the volatile labour environment as a deterrent to investment. Seifsa has said the local head of US vehicle maker Ford Motor was under pressure from head office to sell up its operations. Ford, which has invested over ZAR 3.4bn (US$ 317m) in two South African plants, producing its Ranger pick-up truck for the domestic market and for export to nearly 150 other markets, indicated that it is committed for the long term. However, this morning Ford announced that it temporarily suspended production at one of its South African plants due to a strike at some of its suppliers.
“Production at our Silverton assembly plant has been temporarily suspended due to the strike,” spokesperson Alicia Chetty said.