Harley-Davidson: Strike means motorcycle shipments will be short
Emily Fredrix
Fri, Feb 09, 2007
AP (Associated Press)
Harley-Davidson Inc. said Thursday an ongoing strike at its largest assembly plant means the motorcycle maker will miss shipment guidance for the first quarter.
The Milwaukee-based company had expected to ship between 82,000 and 84,000 bikes during the first three months of the year.
The company declined to provide its updated shipment guidance for the first quarter and also would not say whether the strike at its plant in York, Pennsylvania, will have an effect on full year financial guidance.
Nearly 2,800 unionized employees have been on strike since Friday after they overwhelmingly rejected the company's contract proposal last week. The three-year proposal offered annual raises of 4 percent, but it also would have reduced pay rates for new hires, required employees to begin paying part of their health insurance premiums and forced pension concessions.
The company and the International Association of Machinists and Aerospace Works Local 175 held federally mediated negotiations on Tuesday and Wednesday, though nothing was resolved, Harley spokesman Bob Klein said. No further meetings are planned, he said.
Harley also informed the union it would cancel its workers' health and life insurance on Monday, a normal action during strikes, Klein said.
Messages left with union officials were not immediately returned Thursday.
Harley has said the strike may force it to temporarily lay off as many as 740 employees at two Wisconsin plants as early as next week. The company said it expects to reduce production of engines and transmissions in Menomonee Falls, Wisconsin, and injection-molded components in Tomahawk, Wisconsin. Initial layoffs would be voluntary, Harley said in a news release Thursday, but they could be followed by forced layoffs.
The York plant employs more than 3,200 union and nonunion workers who make Touring and Softail motorcycles.
In November, 1,600 union workers in the Milwaukee area approved contract concessions that Harley-Davidson demanded to proceed with a $120 million plant expansion. Members of United Steelworkers of America Local 2-209 initially rejected the proposals, which included lower wages for workers hired after Jan. 1 and a decrease in health insurance, pensions and cost-of-living adjustments for all workers.