The United Auto Workers (UAW) announced that some 48,000 workers at General Motors Co. plants will go on strike starting on Sunday in a move that could hurt the American auto giant and even the whole US economy.

The decision to go on strike was taken after labor contract talks between the manufacturing company and the trade union ended up in a deadlock. It will be the first nationwide strike in more than a decade for General Motors, as the last time its workers took industrial action was in 2007 when they staged a two-day strike over contract talks.

This time, the stakes are a little bit higher. The union opposes the closures of two auto assembly plants in Ohio and Michigan, apart from demanding higher wages following years of record profits for the car manufacturing giant.

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The company appears unrelenting, though, as it argues that the shutdowns are necessary because the plants are lacking products. It also bluntly states that the union members’ wages and benefits are already too expensive in comparison to those of the workers at non-union auto plants in southern US states.

GM, however, said in its statement that it “negotiated in good faith” and offered the union more than $7 billion in new investments as well as 5,400 new jobs together with some pay increases and improved benefits. The workers, who see the plant closures as a betrayal of those who stood by GM when it went through the 2009 government-led bankruptcy, apparently found these terms unsatisfactory.

“General Motors needs to understand that we stood up for GM when they needed us,” Ted Krumm, head of the union's bargaining committee in talks with GM, said at a press conference on Sunday. “These are profitable times ... and we deserve a fair contract.”

Meanwhile, the facilities’ shutdown drew wider criticism, including from the US President Donald Trump, who once vowed to create jobs under his ‘America first’ doctrine and now sees Ohio as a key state for his 2020 re-election.

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It is yet unknown for how long the strike will last but it could quickly bring work at GM plants across the country to a standstill and even damage the US economy at a time when the American auto industry sees slowing sales and rising costs of curbing emissions, as well as some problems with launching electric vehicles.

One of the solutions proposed by GM for the troubled factories involves turning the Ohio plant into an electric vehicle battery production facility. Yet, for now, its fate still remains unknown.

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