AFL-CIO worries GM job cuts are a 'smokescreen for offshoring' 

  • GM has a 'particularly bad' history of using every excuse to offshore work, said one union leader.
  • The AFL-CIO's Damon Silvers said the automaker uses "bottom feeder" tactics like paying $2 an hour wages in Mexico.

The AFL-CIO labor union is worried that General Motors' decision this week to halt production at several factories and cut thousands of jobs in the U.S. could be a pretext for sending work outside the country where labor costs are significantly cheaper.

"This situation is really about whether or not GM is going to put new work into these plants or whether this is a smoke screen for offshoring work," AFL-CIO policy director, Damon Silvers said on CNBC's Power Lunch.

"GM is committed to maintaining a strong manufacturing presence in the U.S., as evidenced by our more than $22 billion investments in U.S. operations since 2009," GM said in a statement. "Yesterday's announcements support our ability to invest for future growth and position the company for long-term success and maintain and grow American jobs. Many of the U.S. workers impacted by these actions will have the opportunity to shift to other GM plants where we will need more employees to support growth in trucks, crossovers and SUVs. GM's transformation also includes adding technical and engineering jobs to support the future of mobility, such as new jobs in electrification and autonomous vehicles.We appreciate the actions this administration has taken on behalf of industry to improve the overall competitiveness of U.S. manufacturing."

The automaker said Monday it will begin phasing out the production of several vehicles at a number of factories in the United States and Canada.

GM has said it is cutting production of these vehicles in part because they are slow-selling, but Silvers said GM recently decided to start making the Chevrolet Blazer SUV in Mexico, rather than the plant in Lordstown, Ohio that it plans to wind down.

GM has a "particularly bad history" compared with Ford and Chrysler of looking to move jobs off shore he said.

Successful auto companies worldwide pay decent wages and benefits to high-skilled workers, Silvers said.

"The bottom feeders do things like exploit $2-an-hour wages, which is what GM pays in some of its factories in Mexico," he said. "What we want them to do is to be in a first tier strategy that really takes advantage of the skills and capacity ... of America's workers and America's communities."