God knows how the United Auto Workers' leadership thought they could strip the already contentious GM contract of its job guarantees and sell it to 45k Chrysler members. While the union was entranced by another multi-billion dollar bribe contribution to the Mother of All Health Care VEBA Superfunds, Chrysler workers were listening to WII-FM (What's In It For Me?). Despite a whack on their heads six-hour strike, some members have decided the contract isn't in their best interests. The AP is reporting that UAW workers at Chrysler's St. Louis (MO)  plant have rejected the new deal by a staggering 80 percent. Their thumbs-down follows a thumbs-up by 800 workers at Chrysler's Kinosha (WI) engine plant– by an equal though opposite margin. Interestingly, only 1400 of 2100 Missouri workers voted (disinterested or fear of reprisals?). AP reporter Jim Salter didn't speculate on the final outcome, but he did set the scene for the struggle to come: "The votes come as UAW officials in Detroit stepped up efforts to convince the rank-and-file to approve the pact in the face of dissent by a top bargainer." We'd love to know the exact nature of those "stepped-up" efforts. 

When Cerberus liberated Chrysler from its German captors, we speculated on the role parts maker Magna would play in the ailing automaker's future. At the time, we were looking for the three-headed canine to perform a quick strip and flip, off-loading a big ass chunk of Chrysler's production onto the cash-rich Canadians. Perhaps we spoke too soon. Bloomberg reports that Magna has reversed decades of anti-union efforts and signed a "Framework of Fairness" with the Canadian Auto Workers Union (CAW). Under the terms of the agreement, the CAW agrees to a no-strike clause, in favor of independent arbitration.Today's Globe and Mail prints a joint statement by Magna's Frank Stronach and the CAW's Buzz Hargrove claiming that they've put away their differences "for the sake of the industry." Apparently. "economic studies have suggested that companies that pair union representation with extensive mechanisms for worker involvement and participation attain the best possible combination of high productivity and high morale." Who knew? A more likely explanation: at a stroke, the deal removes Chrysler's United Auto Workers members' objections to Magna's purchase of Chrysler production facilities, if not the entire company. Rock and roll!

After the United Auto Workers (UAW) ratified their new contract with GM, the automaker's stock price soared to $40.06 per share. The Detroit Free Press now reports that GM's stock price fell nearly four percent on Tuesday, as Wall Street has begun re-considering the whole GM/UAW/VEBA thing. Morgan Stanley analyst Jonathan Steinmetz is having second thoughts about the wisdom of establishing The Mother of All Health Care Tax-Free Funds. "Funding terms appear somewhat less attractive than initially envisioned," Steinmetz prevaricated. "GM has settled a $47-billion liability for the equivalent of $37 billion, or about 78 cents on the dollar." Analyst Peter Nesvold from Bear Sterns says GM's UAW contract is potentially transformational… longer term. Meanwhile "GM shares are at a potential peak and on the way down." 

Just a few weeks after making a deal with the UAW to guarantee work at specific plants, GM is cutting one shift and laying off 767 workers at their Poletown assembly plant in Hamtramck, Michigan. It didn't take GM long to find the loophole in the agreement: the deal guarantees future work but doesn't say how many workers they'll use or how many shifts they'll run, either now or in the future. Currently the plant builds the Buick Lucerne and Cadillac DTS. In September, Buick averaged six sales per dealer while Caddy floggers averaged 14; so they don't need a lot of production capacity. The "future models" slated for Poletown include a new midsize Chevy sedan (isn't that what the Malibu is supposed to be?), a seven-passenger CUV (another one– just what GM needs) and the Chevy Volt (yeah, right… whenever). The laid-off workers can be used to fill other positions within GM as needed, according to the Detroit News.

Even as Chrysler workers ponder whether or not to accept their new contract, GM is bragging about announcing the blessings the union has bestowed on the automaker's bottom line. Under the two-tier wage structure in the new United Auto Workers (UAW) contract, GM will be paying "non-core" workers about a third of the total wages and benefits they presently shell out to their union workers. The Detroit Free Press reveals that revisions to these employees' pension fund and health coverage will lower their cost to the company to $25.65 per hour. That's compared to the $78.21 per hour in wages and benefits GM currently pays all their UAW workers. What's more, GM expects 65  to 75 percent of their hourly employees to retire during the four-year life of the contract; many of these retirees will be replaced with lower-paid workers. CFO Fritz Henderson predicts the new labor deal will save The General some $2.8b in annual cash flow by 2010, and $3.3b by 2011.

The Detroit News reports that the United Auto Workers' (UAW) local officials have accepted the tentative contract agreement with Chrysler. Despite the vote, some high-ranking UAW officials- including the head of the UAW bargaining committee- aren't what you'd call sold on the deal. Citing issues with job guarantees (i.e. there aren't any) and the two-tier wage agreement (no provision for temporary workers' transition to full-time employment), they plan to campaign against the Chrysler agreement's ratification. UAW boss Ron Gettelfinger doesn't appear worried at the prospect of an internal rift, assuring Automotive News [AN, sub] that the contract vote was overwhelmingly in favor of the agreement. Yes, well, the exact results of the vote were not released, and AN forgot to ask Big Ron to define "overwhelmingly." Chrysler's 45k rank and file UAW members will vote on the proposed Chrysler contract later this week. Gettlefinger is confident this his union brothers and sisters will accept the new agreement as he moves on to capitulate negotiate with Ford.

When the United Auto Workers (UAW) concluded their strike against GM in two days, plenty of people reckoned the industrial action was designed to put the fear of God into union members, rather than wrest new concessions from GM. If so, it worked a treat; 66 percent of the UAW rank and file approved the new contract the following week. When the UAW strike against Chrysler lasted six hours, the strikelet scared no one. In fact, Bloomberg reports that the head of the UAW's negotiating committee at Chrysler will tell his union brothers and sisters to reject the accord. Doh! He forgot the job guarantees! "Virtually no Chrysler plant received commitments beyond the scope of their current product," Bill Parker revealed. "The plant- by-plant threats we've experienced in the past will continue." Parker's also says the settlement fails to match the GM accord's assurances that Chrysler's current temporary workers will move into full-time jobs. So why is the UAW lead negotiator disavowing his own agreement? You guessed it: union politics. Parker is part of an anti-Gettelfinger faction called "New Directions." This could get interesting…

MSNBC reports that the United Auto Workers (UAW) have just walked out on Chrysler. Given that the UAW strike over at GM lasted the smaller part of two days and resulted in an agreement that gave the automaker pretty much everything they wanted, don't look for much hand-wringing excitement in this latest action against Chrysler for at least a week. By then we should know what gives, or more, precisely, who gives what. Is the UAW using the strike to soften-up 49k Chrysler workers for GM-like givebacks, or is this the real deal: an American automaker drawing a line in the sand? The fact that Cerberus, Chrysler's new master, is a privately-held company looking to strip and flip changes the fundamental dynamic considerably. Or not. In any case, once again, the union bosses aren't sayin' notin' to no one as to why they walked: “The company has thus far failed to make an offer that adequately addresses the needs of our membership,” UAW President Ron Gettelfinger said on Monday. So now you know.

Showing a Farago-like faith in GM's future, a current GM employee and retiree have challenged the use of a $4.4b "convertible note" as part payment for the VEBA health care superfund in the new United Auto Workers (UAW) contract with The General. According to the Detroit News, the complainants are concerned that the trust fund would be at risk should GM file for bankruptcy. In a letter filed with the Securities and Exchange Commission, the workers said GM hasn't disclosed enough information about the note and should have released a formal prospectus. Their suit also states that the details given "fell dramatically short of the standards" for such a transaction. Although GM is "confident" they "complied with all applicable securities laws," this is just one more case the SEC will add to their list of GM accounting investigations. (You didn't think we forgot, did you?)

Under the new UAW-GM contract, workers' health care will be funded by large-scale investments in Japanese automakers and their suppliers. Just kidding (I think). But the union's rank and file may find changes in their health care coverage equally palatable. The Detroit Free Press reports that the UAW's leadership has agreed to cutback on the number of health care plans offered and the number of providers the plans will covers. But wait, there's less! They'll also raise copays (a bone of contention in '05) and eliminate all dental HMOs. Under the only PPO on offer, union member's family get five "free" doctor visits a year with a $25 copay for each visit. Surprisingly, the UAW leadership is downplaying the changes; they aren't mentioned during the 30-minute "information" meetings before the contract vote. One unforeseen (and so far unmentioned) ramification of ratification: it could trigger an exodus of medical talent from the Detroit area.  But that's OK. GM's going to spend $15m to create a National Institute for Health Care Reform to "study solutions to national health care woes." That should make UAW members feel better… eventually.

Soldiers of Solidarity isn't the only organization opposed to the new UAW/GM contract. A writer for the World Socialist Web Site (WSWS) was "assaulted and physically threatened" by UAW officials while distributing anti-contract leaflets outside union halls hosting ratification meetings. Socialist Equality Party (SEP) member Larry Porter was confronted by a man who identified himself as a chairman of the union who tried to stomp stop him. Later, "a man wearing a shirt bearing the UAW International emblem… told him if he did not leave immediately there would be 'trouble'." At a second meeting the same official threatened "to kick this guy's ass." The SEP sent a letter to Ron Gettelfinger, reminding him "were corporations to threaten members of the UAW engaged in organizing drives, your organization would certainly take legal action against those who sought to deprive the union of its democratic right to distribute leaflets on public property." The WSWS is warning GM workers to beware of "physical violence against workers opposed to… passage of a contract that gives [the UAW] control over $60 billion-$70 billion in retiree health funds." Meanwhile, the Washington Post reports that while some locals have ratified the contract, there's still quite a bit of dissent in the ranks. If the contract doesn't pass, all Hell will break lose.

According to Bloomberg, the new UAW agreement could shift one fourth of GM's union workers into lower-paying jobs over the next four years. Under the new contract, more than 16k jobs will be classified as "non-core" positions– which don't qualify for a full UAW pension or retiree health care. Workers currently in these jobs won't have pay and benefit cuts, but there will be a "special attrition program" encouraging them to leave. Kristin Dziczek, an analyst at the Center for Automotive Research, points out that "non core" refers to any job that doesn't involve bolting bits together. To earn the full $51 an hour in pay and benefits, "you have to run an air gun on the line, and that's not easy work." So workers who used their seniority to get a relatively cushy job (e.g. driving a forklift) will suddenly find themselves SOL. Expect retiree numbers to swell as retirement-eligible workers choose between a pay-off and a significant downgrade in pay and bennies.

If the UAW ratifies the new GM contract and agrees to the VEBA, they could end up as GM's biggest shareholder. Based on information about the VEBA provided by the UAW, Financial Times estimates GM's contribution will include a $4.4b note that can be converted into GM stock. At current rates, that would buy a 17 percent equity stake in GM. What would happen then is anyone's guess, but it sounds like a huge conflict of interest in the making. Would the UAW be as willing to take actions against GM in support of their membership if they knew it could cause the value of the stock to drop and hurt their members? Will the UAW try to exert influence via shareholder meetings in lieu of contract negotiations? Fun!

Members of the Canadian Auto Workers union (CAW) may be caught between the proverbial rock and hard place when their contract comes up for renewal next year. On one hand, tough-talking union prez Buzz Hargrove says "we're not going down [the] road" of UAW-style concessions." He's also assured his 37.5k CAW members that a two-tier wage system and concessions are "non-starters." On the other hand, if the CAW hangs tough, they could create a significant Canada – US "wage gap." Analyst Dennis DesRosiers says if the status remains quo, there'll be a $25 dollar per hour differential. The Big 2.8 would then be tempted to send production back south or to overseas locations. With the pressures of the much larger UAW agreeing to a two-tier wage system and the threat of lost jobs, Buzz may have to tone down his rhetoric and behave in a diplomatic manner– as unaccustomed to that 'tude as he may be.

The Hartford Courant reports that the United Auto Workers (UAW) has filed a petition with the National Labor Relations Board to hold a union vote at Foxwoods Casino in Connecticut. The petition is part of a plan to organize the casino’s 3000 dealers– a goal that has eluded the UAW for the last 15 years. "We have waited for this day for a long time," says pro-union poker dealer Steve Peloso. According to the Courant, a starting dealer pulls down about $4.50 per hour, plus mucho tips. (Last year Foxwoods banked an estimated $400m in profits.) The Casino drive is part of the UAW’s ongoing and far-reaching effort (freelance writers need apply) to broaden their base in the face of declining membership in the automotive industry.