Strike Sends American Axle to Loss

American Axle & Manufacturing Holdings AXL said it had a first-quarter loss as the company dealt with a strike by the United Auto Workers over a labor agreement.

The auto components and systems maker said it swung to a first-quarter loss of $27 million, or 52 cents a share, from a profit of $15.7 million, or 30 cents a share, in the year-ago period. Sales fell to $587.6 million in the first quarter from $802.2 million in the same period last year.

American Axle said the UAW strike in February, where about 3,650 employees represented by the union went on strike at plants in New York and Michigan, forced a reduction in sales and operating income by $132.6 million and $45.8 million, respectively. The Thomson Financial consensus estimates were for a loss of a penny a share on revenue of $664 million.

Earlier this week, American Axle said that the latest proposal aimed at ending the two-month-old strike was "not market competitive" and that it may close striking production plants if the UAW workers do not accept pay and benefit cuts.

"While it would be tragic to dismantle AAM's original U.S. manufacturing base, AAM will be forced to consider additional restructuring and capacity rationalization actions if the International UAW refuses to accept the structural and permanent changes needed to achieve market cost competitiveness at these facilities," CEO Richard Dauch in the earnings release.