Auto talks rev up
The negotiations are likely to be messy
Prepare for a messy round of national contract talks this summer between the United Auto Workers and the Detroit Three automakers. The crux of the talks will be about job security and what new products will be built at which plants in the next few years.
Talks officially opened about a week ago, with the car firms and the union each talking tough. Framing the talks are the recent big profits by General Motors Co., Ford Motor Co. and Fiat Chrysler Automobiles as well as the pronounced shift in the public buying many more light trucks and sport utility vehicles and fewer small cars, and an ongoing decline in overall U. S. vehicle sales.
The four- year contracts that cover 150,000 workers with the Detroit Three expire the night of Sept. 14, so bargaining likely will be done quietly until late August when the UAW typically picks a target company. It then hammers out an agreement with that automaker and will try to impose most of the wages, benefits, and other terms on the other two companies.
Key issues will range from the use and pay of temporary workers and the amount of worker cost- sharing for health care to the amount of profit sharing and keeping existing plants open. Talks at GM in particular but all three in general will seek explicit commitments to produce new vehicles, and jobs, at U. S. factories, instead of at plants in Mexico or elsewhere. Future use of GM’s Lordstown, Ohio, assembly plant, which was essentially shuttered this year, displacing thousands of workers, likely will be hotly debated.
GM, Ford and Fiat Chrysler all want to cut costs, especially with slumping sales. The Center for Automotive Research in Ann Arbor, Mich., says Fiat Chrysler pays $ 55 an hour in wages and benefits to UAW workers, while Ford pays $ 61, GM pays $ 63 and foreign- owned U. S. plants pay about $ 50.
To temper that cost difference with the foreign automakers, automakers will seek the ability to use more temporary workers and pay them well under the $ 30 an hour
made by a full- time UAW worker. This becomes especially critical for the Detroit Three for competitive reasons as many Americans don’t shop for a UAW- made vehicle and often don’t distinguish between a U. S.branded car company and those such as Honda and Toyota, which have U. S. plants making vehicles.
Of all the issues, however, the UAW would most likely strike if it does not get what it desires on firm commitments to build products and add jobs. Each automaker presumably will be prepared to address this demand.
A backdrop to this year’s talks, particularly at Fiat Chrysler, is the union corruption uncovered since the last national contract. One top UAW official and four other unionrelated people have been convicted of improper use of money from funds jointly run by Fiat Chrysler and the UAW. A federal criminal investigation into related problems continues.
The scandal could lead some UAW members who might dislike the terms of a tentative agreement to feel their union leadership sold them out for a behind- the- scenes deal. That will make it tougher for the union bargainers to reach a contract acceptable to the rank- and- file.
The outcome of the negotiations is monumental and affects not only the plants and workers of the Detroit Three, but many auto suppliers and their workers. It can have a rippling effect through the economy. Let’s hope for earnest discussions and reasonable solutions.