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A strike by the United Auto Workers has forced General Motors to shut down 25 of its North American plants, affecting nearly 90 percent of its production capabilities. Following a background report, Elizabeth Farnsworth and guests discuss the reasons behind the strike and its economic implications.

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A RealAudio version of this segment is available. NEWSHOUR LINKS: June 19, 1998: A discussion on the GM strike. March 12, 1996: The United Auto Workers strike in Dayton, Ohio. Browse the NewsHour's coverage of business. OUTSIDE LINKS: General Motors United Auto Workers

KWAME HOLMAN: In the pre-dawn hours today, the Lordstown, Ohio assembly plant became the 22nd General Motors facility to shut its doors. The initial strike against the world's largest auto-maker occurred 15 days ago. That's when 3400 United Auto Workers Union members walked away from their jobs making auto body parts at GM’s metal stamping plant in Flint, Michigan. Seven days later, another 5800 UAW workers walked off the job at the Delphi parts plant also in Flint.

The shut down of 90 percent of GM's facilities.

The resulting parts shortages caused a ripple effect that now has idled 90 p ercent of GM's facilities in North America. The main issue for the United Auto Workers is job security. Unlike in many strikes, the UAW in Flint has a current contract. The union says the workers –whose annual pay averages $69,000--struck over concern about the future.

AUTO WORKER: This is a last resort. We are fighting for American jobs here.

AUTO WORKER: There’s got to be a stand somewhere. They’re shipping all the jobs out to the other countries. I can’t understand it myself. They ship all the jobs out, then people aren’t going to have—it don’t make any sense.

KWAME HOLMAN: They worry jobs soon will be lost because of consolidation of some production and GM's use of outside contractors. Workers at the metal stamping plant say General Motors broke a 1995 commitment to spend $300 million to upgrade the facility. Since the 1970's, GM has cut more than half the jobs at the metal stamping facility. Workers at the Delphi plant say their concern is over so-called out-sourcing. The union says GM may send as many as 2500 jobs out to nonunion plants in North America and abroad. The company responds changes are necessary because strict union work rules have made both Flint plants inefficient and uncompetitive.

At a cost of $500 million a week.

The shutdowns reportedly are costing GM some $500 million a week. GM dealers around the U.S. report shipments of new cars have slowed just as the big summer sale season gets underway. Currently more than 100,000 UAW workers from 23 factories—one of which closed this afternoon—are laid off without pay and are not eligible for strike benefits. Negotiations between General Motors and the UAW continued today in Flint as more factories around North America prepared to closed down on Monday.

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