Is BMW a Union Buster?
Is luxury automaker BMW trying to bust a union in California? It sure looks that way, judging from a letter that Sen. Barbara Boxer sent to BMW North America CEO Jim O'Donnell, asking him to reconsider a poorly thought-out plan to fire BMW's nearly 100 Ontario, Calif., employees later this summer and immediately re-open the facility the very next day with a cheaper, inexperienced workforce. U.S. Rep. Joe Baca, a fellow Democrat who represents California's 43rd District, sent a similar letter to BMW as well.
The German automobile giant, Bavarian Motor Works AG, booked its richest earnings in its 95-year history this quarter. BMW had global sales of almost $81 billion in 2010, or about $848,000 per employee, ranking it number 82 on Fortune's Global 500 Companies.
It was because of these numbers Boxer wrote, "As the economic recovery continues, it is deeply disappointing that these loyal employees would be penalized at a time when your company recently reported 2011 first quarter earnings of $1.78 billion -- triple that of first quarter earnings in 2010 -- and first quarter sales 21 percent greater than last year."
Baca wrote, "[This] will needlessly lay off workers in a region experiencing the highest rates of unemployment in the country. Replacing those positions with a low wage workforce is an injustice and a blow to our local economy."
"BMW would never be allowed to get away with this in Germany -- they wouldn't dare try it," said Bob Lennox, treasurer of Teamsters Local 495, which represents 65 workers at the Ontario parts-distribution facility. "They think they can take an American taxpayer bailout and then treat their American workers in a way they would never treat their German employees."
Ontario BMW workers held a rally on June 16 to protest the layoffs. Tim Kitchens, a 32-year worker at the warehouse, talked about how losing his job would impact his family.
"I need this job and the health insurance to take care of my family," Kitchens said. "Many of us have worked here for decades and have helped make BMW the most profitable luxury car company in America. We stood by them in the dark days of 2009 and now they're throwing us out on the street so they can hire cheaper, inexperienced workers, and pocket the difference."
According to BMW, however, this is much ado about nothing. KABC reports that the company released the following statement: "The business in Ontario is not going anywhere. We want to provide our dealers and customers with excellent service. We are working with the teamsters union to make this an orderly and smooth transition."
The statement is notably unclear on what will happen to the workers.
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