Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

5 of 6
BACKNEXT
Union workers
Union workers
After brief strikes in 2007, the UAW made serious cost-saving concessions that will help automakers in the future.
Gripe: Union workers get paid too much
Fact: Pay isn't the problem, it's benefits. But the UAW has made significant concessions.

GM, Ford and Chrysler all hire union workers to work in their U.S. factories. But their Asian competitors have based most of their U.S. factories in Southern "right-to-work" states where companies don't have to hire union staff. Combine that with an overall younger workforce with fewer retirees, and Asian automakers have big cost advantages in the U.S.

But even the Detroit automakers themselves don't claim to pay more than Asian automakers working in the U.S. GM estimates its hourly pay for an assembly line worker is about the same as that of someone working for an Asian manufacturer here.

The differences come from retirement and health-care. Detroit automakers pay a lot more per worker-hour because they have more retirees to whom they extend full health-care benefits.

What's to come: The UAW recently made significant concessions that should save GM, Ford and Chrysler a lot of money in the long run.

The union allowed Detroit automakers to pay newly hired workers less per hour than previously hired employees. It also agreed to take over the cost of retiree health care provided the automakers paid lump sums into an investment fund to cover the costs.

NEXT: Fat executive paychecks

Last updated December 08 2008: 6:50 PM ET
More Galleries
Super Bowl bound? Things to do in Houston besides the big game If you're one of the thousands of fans are headed to Houston for the Super Bowl Sunday, here are five things to do when you're not at the stadium. More
Sneak peek at Super Bowl 51 ads The ghost of Spuds MacKenzie and an ad about immigration steal the show in the swell of upcoming Super Bowl ads. Advertisers are paying, on average, $5 million for 30-second spots during Sunday's game on Fox. But if you want to watch something other than commercials, the New England Patriots happen to be playing the Atlanta Falcons. More
Most expensive cars from the Scottsdale collector car auctions The ten most expensive cars sold at the annual Arizona collector auctions went or a total of $44 million. More

Special Offer