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UAW eyes job security
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June 14, 1999: 6:44 p.m. ET
Auto labor union opens Big Three negotiations from a tenuous position of strength
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NEW YORK (CNNfn) - The United Auto Workers Union initiated pivotal contract talks with Detroit's Big Three automakers Monday, hoping to leverage the industry's record sales into improved job security for its dwindling membership base.
Operating from perhaps its strongest bargaining position in years, the UAW likely will not begin serious negotiations with representatives of Ford Motor Co., General Motors Corp. and DaimlerChrysler AG for at least another month. The two sides have until Sept. 14 to agree on a new contract covering roughly 407,000 UAW members.
But with the costly 54-day UAW strike at two General Motors plants last summer still fresh in everyone's minds, both sides are hoping to avoid disrupting the industry's white-hot momentum yet again.
"None of the three companies want any kind of work disruption," said Bob Marsin, Ford's executive director of labor affairs. "It takes a long time to get back from that kind of thing. This year, there's a lot of new faces on both sides of the table . . . so I'm confident we can get something worked out."
Who's on first?
The dynamics surrounding this summer's negotiations are similar to year's past with one notable exception: The industry's booming car and truck sales.
Strong monthly and quarterly sales reports from all three Detroit automakers has left the union with the upper hand at the bargaining table, analysts said.
That makes the traditional summertime jockeying to become the first auto company to negotiate its contract with the UAW all the more important. Under the UAW's pattern bargaining strategy, the union reaches a pact with one company and then uses that as a template for the other two. All three automakers want to be the target because it allows them to control their own destiny rather than having to accept an agreement that was established by one of its rivals.
"A lot will depend on who's the first company up," said Harley Shaiken, a labor professor at the University of California-Berkeley. "You may almost have an insipid auction taking place among the companies trying to be first."
While traditional issues -- such as health care costs, overtime benefits and job security -- are expected once again to dominate the contract negotiations, the discussions hold unique challenges for each of the companies, further piquing their interest to arrive first at the negotiating table.
Delphi employees could dominate GM talks
General Motors (GM) is once again expected to push for some flexibility to reduce its weighty cost structure while defending its decision to spin off its auto parts subsidiary, Delphi Automotive Systems Corp.
UAW officials are seeking to ensure Delphi employees remain under the union contract's umbrella, while continuing to try and fend off lower-cost suppliers that threaten union jobs.
There are still some lingering hard feelings from last summer's strike at GM plants, but both sides are hoping the introduction of Gary Cowger, GM's new labor negotiator, into the process will help smooth the waters.
"I think everybody is looking forward, not back," said Ed Snyder, a GM spokesman. ""Everyone out there recognized that striking wasn't beneficial and not talking early on in the process wasn't beneficial."
"The question this time is does GM need more than Ford or Chrysler?" said Jeff Guiler, a professor of management relations at Robert Morris College. "GM paid dearly for that strike. When you're working with such tight inventories, you can't afford to do that again."
But Snyder said the company is not gearing up for another possible strike by stockpiling cars despite reports the company has been working its plants overtime recently.
Union officials are looking for similar guarantees from Ford (F), which is mulling a possible spin off of its parts division, Visteon, as well.
Ford officials are also looking for some flexibility to manage costs, which company officials claim continue to be a problem as competitive pressures increase.
"My poverty speech didn't go over too well this morning," Marsin joked after the ceremonial handshake with UAW President Stephen Yokich to kick off the negotiations. "But when the economy is strong, I think that you really can forget about the competitive pressures in the future. Cost pressures are up and we have to react to that.
The auto talks will also be important for organized labor as it tries to demonstrate to its members that it has the clout to resist Corporate America's push for continued productivity gains.
All three U.S. car companies have slashed thousands of jobs over the last 10 years in an effort to compete with Japanese automakers. And experts say the factory of the future is likely to feature more even fewer workers as car companies turn to outside suppliers or modular assembly to keep costs down.
"Not only is it a new contract for a new century, but it's a contract that a lot of people in the U.S. and in the world will be watching not only what we accomplish, but how we do it,'' Ford President Jac Nasser told the bargaining teams. "The how is almost as important as where we come out in the end.''
DaimlerChrysler also faces similar pressures to both Ford and GM, but also must deal with the future of its Mercedes-Benz plant in Alabama and three Freightliner commercial truck plants brought under the company's umbrella when Chysler Corp. merged with Germany's Daimler-Benz AG last year.
The company has pledged to remain neutral in any such effort to unionize those plants, but prefers holding election there rather than letting the union try to sign up 51 percent of its members. 
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