Categories: Market Overview

U.S. auto industry workers return to jobs amid concerns of second virus wave

Factory workers began returning to assembly lines in Michigan on Monday, paving the way to reopen the U.S. auto sector but stoking fears of a second wave of coronavirus infections as strict lockdowns are eased across the country.

With millions of Americans out of work and much of the economy at a virtual standstill, a growing number of states are relaxing tough restrictions on commerce and social life put in place to slow the outbreak. Some auto suppliers in Michigan, a Midwest industrial powerhouse hard hit by the pandemic and its economic fallout, reopened plants on Monday with skeleton crews to get ready for a resumption of vehicle production next week. Skilled-trades workers and salaried employees also began returning to auto assembly plants to prepare for the wider restart.

The manufacturing reopening approved last week by Governor Gretchen Whitmer was crucial not only to auto plants in Michigan but to vehicle production elsewhere because so many key parts suppliers are based in and around the automaking hub of Detroit.

Detroit’s Big Three automakers – General Motors Co, Ford Motor Co and Fiat Chrysler Automobiles NV – said last week they planned to restart production at North American plants on May 18. The target date was set after tacit approval from the powerful United Auto Workers union, which previously opposed a May restart as “too soon and too risky.”

Ford said it had adopted safety protocols from China, where car production resumed in late February, including personal protective garments on assembly lines, barriers separating employees clustered together and heavily sanitized work areas. Much is at stake. The auto sector accounts for 6% of U.S. economic output and employs more than 835,000 Americans.

A small but high-profile sector of the U.S. auto industry became a flashpoint in California on Monday as Elon Musk, chief executive of electric carmaker Tesla Inc, defied local health officials and restarted his factory outside San Francisco.

California Governor Gavin Newsom had given the OK for manufacturing to reopen statewide on Friday, but Alameda County’s more stringent lockdown orders barring factory operations for another week supersede Newsom’s authority. Musk, who had threatened to move his plant to another state unless officials relented, said on Twitter that production resumed on Monday, adding he would join workers on the assembly line. “If anyone is arrested, I ask that it only be me,” he wrote.

Moves to loosen the clampdown have played out even as the number of lives lost continues to rise. Well over 80,000 people in the United States have died in the pandemic out of more than 1.35 million known U.S. infections reported since Jan. 20, according to a Reuters tally.

U.S. auto industry workers return to jobs amid concerns of second virus wave, Reuters, May 12

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