A decade of union and management flexibility at this engine manufacturer keeps jobs at home and improves workplace productivity.

In Partnership With: IUE-CWA

A team approach to building engines and keeping auto manufacturing jobs in the U.S.

While the U.S. auto industry is suffering from low sales, high layoffs, and imbalanced trade agreements, an Ohio auto parts manufacturer underscores how flexible partnerships between labor and management are good for business and can prevent jobs from being sent overseas.

DMAX-Ltd. began as a joint venture between General Motors (GM) and Isuzu Motors. It was born after GM initially chose to cease domestic production of diesel engines and open new operations in Mexico. After this announcement, the International Union of Electrical Workers-Communications Workers of America (IUE-CWA), which had represented many local GM employees for generations, worked overtime to stop the jobs from being lost. The union sought compromises and creative solutions, and in 1997, entered into a landmark agreement with GM that kept these jobs in the U.S. while maintaining family-supporting wages and benefits. The plant reopened, and DMAX started manufacturing Isuzu-designed diesel engines for GM trucks in 2000.

The agreement made sure that workers could form a union if they wanted, without any management interference in their decision. It also created a unique team concept: groups of five to 10 employees and a team leader work together and resolve labormanagement issues, largely determining how DMAX conducts business. “Our team concept has always come through for us. It seems to work in our manufacturing environment,” says John Cooper, Labor Relations Manager for DMAX. Each team also has a safety coordinator, and the company’s safety record is impressive. As of July 2008, the company has operated nearly five million hours without an OSHA lost workday case. The OSHA recordable injury rate per 100 employees has been reduced to just 1.10, ranking the manufacturing plant among the best in the auto industry.

As a result of this empowering team approach, productivity and quality are high. By April 2007, the workers produced DMAX’s one-millionth engine, and the company has earned numerous accolades, including Motor Trends magazine “Engine of the Year” and top rankings from JD Power and Associates.

Thanks in large part to the flexibility of its union employees and unique business model, DMAX has been able to work through the instability of the domestic auto industry. Though the company has seen minor layoffs, wages have remained high relative to the local market, and employees are guaranteed a rehire once demand for production increases. DMAX stands out as a model for how others in the auto industry can weather tough economic times through flexibility and cooperation.