South African union starts indefinite strike, auto industry fears impact
With around 155,000 members organised in the sector, the National Union of Metalworkers of South Africa (NUMSA) has called for a total shutdown of the engineering industry after wage talks with employer bodies deadlocked. "We are left with no choice but to strike and to withhold our labour indefinitely until the bosses give into our just demands," NUMSA said.
South Africa's biggest metalworkers union on Tuesday launched an indefinite strike to press for wage rises in the engineering sector, action that threatens to spill over and block supplies of parts to make new cars, industry and union officials said. With around 155,000 members organised in the sector, the National Union of Metalworkers of South Africa (NUMSA) has called for a total shutdown of the engineering industry after wage talks with employer bodies deadlocked.
"We are left with no choice but to strike and to withhold our labour indefinitely until the bosses give into our just demands," NUMSA said. The union organised marches and rallies across the country on Tuesday, with thousands attending a march in downtown Johannesburg.
NUMSA had sought an 8% across-the-board wage rise in the first year of a pay deal, and an increase equal to the rate of inflation plus 2% for the following two years. Annual inflation is currently around 5%. Industry body Steel and Engineering Industries Federation of Southern Africa had offered 4.4% for 2021, inflation plus 0.5% in 2022 and inflation plus 1% in the third year
Lucio Trentini, chief executive at the federation which represents more than 1,000 firms, from small family-owned businesses with less than 20 employees to large listed companies, said a poll among members on Tuesday showed a worker absenteeism rate of around 26%. "And I fear ... that this number will grow as the strike continues through the week," he told Reuters.
UNION DEMANDS Trentini said they were in contact with NUMSA to try and reach a "mutually acceptable" compromise and prevent a repeat of a damaging four-week strike in 2014 that cost the economy an estimated 6 billion rand ($398 million) in lost output.
Smaller union, UASA, said it was balloting members to determine if they also supported strike action, with a final decision expected on Friday. South Africa's economy, including its export-focused auto sector, was hit hard by the COVID-19 pandemic, making employers reluctant to give in to union demands for above-inflation salary hikes.
Domestic car sales and vehicle production fell by roughly 30% last year, hitting major brands such as Ford, BMW and Nissan which all have local plants. "We urge parties to speedily resolve the impasse and prevent long-term damage and possible line stoppages to vehicles being assembled in SA and abroad," Renai Moothilal, executive director at the National Association of Automotive Component and Allied Manufacturers, told Reuters.
A Ford spokeswoman said they would not comment for now, while a Nissan spokeswoman said they were monitoring the situation "and do not foresee any impact on our side". ($1 = 15.0522 rand) (additional reporting by Alexander Winning and Siphiwe Sibeko in Johannesburg; editing by Kenneth Maxwell, Jason Neely and Emelia Sithole-Matarise)
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