Auto workers face tough battle in contract talks

DETROIT – Contract negotiations for the 110,000 members of the United Auto Workers at Ford, GM and Chrysler opened last week as the current contract expires Sept. 14.

Two years ago, many wondered if there would be an industry to negotiate with. In 2009, the future of auto production, and the union itself, was in doubt as both General Motors and Chrysler went through bankruptcy. Autoworkers here note that it was President Obama who helped engineer a bailout that allowed the industry and its workforce – albeit a much smaller workforce – to survive.

Today the companies are paying off loans, recalling some workers and increasing production. GM earned $4.7 billion in 2010.

In addition to the government’s help, another big lifesaver for the auto companies came from the workers themselves. Union concessions on work rules, health care and wages allowed the companies to erase debt and bring their labor costs down to those of non-union foreign auto factories in the U.S.

But the auto CEOs are declining to share the sacrifice, according to the UAW. At the union’s June bargaining convention, UAW President Bob King brought up a sore point for many autoworkers when he asked why Ford CEO Alan Mulally can make over $50 million in bonus and stock options while 2,000 workers at Ford have only temporary jobs. Making those temporary workers permanent would be a goal of negotiations, King said.

While the industry seems to be reviving, the challenges facing the union remain significant. First of those is the large non-union auto sector in the U.S. Between parts and assembly plants, the UAW no longer represents a majority of the industry.

Another huge challenge facing the union is that auto production is increasingly global. General Motors sells its cars in almost 120 countries and has production facilities in many of them. Forty percent of Ford’s workforce is outside the U.S. This enables the companies to whipsaw workers in one country against those in another, in what’s been called the “race to the bottom.”

UAW leaders say the pathway to regaining bargaining leverage runs through building global solidarity and union organizing.

To that end, the union has significantly stepped up its global outreach, and has been meeting with autoworkers from Germany, South Korea and Mexico and elsewhere. It has helped set up an international steering committee of autoworkers that has ties to the International Metalworkers Federation.

The UAW is also stepping up its organizing efforts at the non-union foreign auto plants, known as “transplants,” here in the U.S. King has set a goal of organizing one Asian or German automaker before the end of the year.

Success in organizing the transplants requires the UAW to be viewed as a protector of both jobs and worker rights in its negotiations with GM, Ford and Chrysler.

That is no easy task. In earlier negotiations, the union agreed to a two-tier wage structure, enabling the companies to bring in new hires at about half of current workers’ hourly rate. In today’s depression-like economy, auto companies, whether they have unionized workforces or not, have no difficulty hiring at the bottom of the two-tier rate. Just last week it was reported that 17,000 workers applied for 1,800 jobs – at $15.51 an hour – at Ford’s Louisville, Ky., assembly plant. Everywhere people are desperate for jobs, and for many people such wages are better than whatever else is out there for them. The same phenomenon is happening in the auto plants in heavily unionized Western Europe.

The union wants to see its membership compensated for the sacrifices they made in saving the companies. However, given the real difficulty of winning significant wage increases in this period, it sees gains as more likely to come through demands for increased profit sharing.

In addition, the union hopes to show non-union autoworkers that successful negotiations with the Detroit Three can be a prelude to stronger contracts and more secure jobs when all autoworkers are organized.

Photo: A GM factory opens in Mexico. Federal Government of Mexico // CC 2.0


John Rummel
John Rummel

Activist John Rummel covers events in Michigan. It's not politics-only for John; he loves sports, the outdoors and a cold beer or two!