By on June 24, 2013

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As Volkswagen gears up for a decision on expanding their Chattanooga factory, a member of Volkswagen’s supervisory board told the Handlesblatt that any new product would be contingent on VW adopting a works council (explanation by our own veteran of Volkswagen BS here) for the plant.

The Chattanooga Times Free Press quotes board member Stephan Wolf as stating

“We will only agree to an expansion of the site or any other model contract when it is clear how to proceed with the employees’ representatives in the United States,”

At stake is a possible new crossover that could be built there or in a Mexican facility. Wolf, a labor leader, is Deputy Chairman of the General and Group Works Councils of Volkswagen AG, and a member of the all-important Supervisory Board, which is responsible for approving key corporate decisions. The remarks come on the heels of an endorsement of the works council from UAW head Bob King, who told Automotive News

“If I was a worker, if I was a member of the Chattanooga community, and I wanted to have the best chance of getting new investment and new product, I would want a voice on the world employee council,” King said. “I would want somebody there representing the interests of Chattanooga. I wouldn’t want a decision made where every other plant in the world has representation there, and I don’t have somebody speaking up for me.”

Both pro and anti union camps have a lot at stake; for VW’s German labor leaders fear that a non-unionized plant threatens to undermine their powerful organizations in Germany and other locales. The unions enjoy as many as 50 percent of the supervisory board seats according to German law, and can influence who holds top executive posts. That makes Wolf’s remarks all the more credible.

On the other hand, Tennessee politicians fear that a union will hurt their own image of being a “right to work” state where companies can set up shop away from the influence of organized labor. Further complicating matters is a law barring employers from starting their own unions. If a works council were to go through, workers at Chattanooga would have to be represented by the UAW – something that would be mutually beneficial to both the UAW and IG Metall, Germany’s largest labor union.

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17 Comments on “No New Product For Chattanooga Unless Works Council Implemented...”


  • avatar
    th009

    It doesn’t need to be UAW specifically. It could even be a VW-only union. However, it’s got to be a union that was created by the employees, not the employer.

    • 0 avatar
      redav

      I agree with your assessment.

      They should be able to pick/form any representation they choose. It also seems that they do not have to form a union, per se, to comply with the requirements of a work council. I believe there are perfectly valid options for them to satisfy VW work council requirements without unionizing.

  • avatar
    stars9texashockey

    Nos vamos a Mexico!
    It would be unfortunate (again) if VW can’t make a manufacturing plant work in the US.

  • avatar
    28-Cars-Later

    That’s cute how King phrased it: “If I was a worker, if I was a member of the Chattanooga community”

    Bob, are you a proud member of the Detroit community? :)

    In all seriousness though, he has a point. I do hope the folks in Chattanooga can work something out where they have the proper say but on the same token do not let in the UAW. UAW -but not necessarily the concept of unions- has demonstrated itself as a cancer on society and needs to die.

  • avatar
    MrGreenMan

    Hear, hear to the previous posters (28-Cars-Later and th009 and redav and stars9texashockey).

    If they are to have a union, it would be great if it was a union that represented them – not long-retired pensioneers or political pals owed a kickback. To that matter, I would suggest that the Second Tier half-workers in the UAW ranks agitate constantly to dissolve their UAW allegiance and form a union that actually represents them. The old social contract is long dead and broken, and was a fabrication meant to bind people’s hands, anyway – there are no pensions anymore – decisions for pay for people who will never have a “guaranteed payment” retirement plan should not be made in the first, last, and only interest of the political slugs and those already receiving their guaranteed payments.

  • avatar
    jpolicke

    I don’t get the UAW’s obsession with organizing in a state where the law gives the employees the right to tell Bob King: “I’m not joining your union, I’m not paying your dues, and I’m not walking out with you when you strike. Take a hike.” How are they ever going to have something resembling the power they’re used to in any right to work state?

    • 0 avatar
      VA Terrapin

      The Detroit 3 is shedding jobs in North America while transplants are adding non-union jobs. The UAW has generally been losing members over the years.

      Right now, the UAW is in bad shape because it still has the stigma of being one of the big reasons why GM and Chrysler needed bailouts in order to survive. In terms of transplants, the UAW is playing a long game where it hopes it can gradually wear down transplant factory workers’ resistance against UAW membership.

  • avatar
    TwoTone Loser

    Writing is on the wall. When I moved to Chattanooga, they were about to begin production. My wife suggested I get a job there.

    “No way!” I said without thinking. “I need a secure job!”
    “What do you mean?” she says.
    “It will FAIL. They couldn’t build Volkswagens in Pennsylvania, they can’t build them properly in Mexico, and especially here in Tennessee, smack in the middle of the Meth belt.”

    I just hoped that VW could attract other UNRELATED businesses before they went belly up.

    As for the union thing, one of the guys who worked on the HVAC units told me how in 1989, he helped install an air handling unit on a factory roof. It was a union job, so by union rules, they required three men on the ground, three men on the roof, one on the crane, and it took them three days.

    All the air handlers(from the satellite view, it looks like dozens) on the VW plant were set down by a guy in a helicopter over a weekend.

    What looks like a better situation to a business owner?

    • 0 avatar
      J.Emerson

      VW is big enough that they could justify helicopter drops for their HVAC units. Helicopter time is obscenely expensive, and it only gets the units there’ it doesn’t actually install them. Your union workers could very well be a cheaper option if one only has to install a couple units.

      • 0 avatar
        TwoTone Loser

        I don’t doubt that a helicopter is an expensive choice, but under union rules, they may well would have filed a grievance for vw making that choice.

  • avatar
    ihatetrees

    It’s unfortunate (for US workers) that implementing an employer run union is considered the moral equivalent of shooting kittens in front of kids. Their use could be a middle ground in worker treatment between union states and right to work states.
    Company unions could, with a public contract, show how a firm treats its workers. It could allay fears of unjust / unreasonable treatment while rejecting nut-job work rules (that a well-known auto union is famous for)

    However, good luck changing the National Labor Relations Act or the Wagner Act with the current statists running Washington.

  • avatar
    J.Emerson

    “If a works council were to go through, workers at Chattanooga would have to be represented by the UAW”

    This is incorrect. If the works council were established, it’s likely that the Chattanooga workers would organize into a union, to facilitate the process. But there’s no guarantee they would choose to associate with the UAW. They could form their own independent local, or they could join any one of the innumerable American industrial unions that would be glad to have any dues-paying members added to their rolls. That’s a scenario not often considered on this blog; there’s no rule that says the UAW would have a monopoly on the formation of unions in the transplants.

  • avatar
    Michael S.

    Am I the only one that sees the VW plant NOT having “representation” as a good thing? Yes, the other plants around the globe may have their unions. That doesn’t mean they are beneficial to the factory or the workers. I know it’s easy to play armchair CEO, but I would be more apt to give the new models to a plant that didn’t require me to get permission from the workers to do a partial shutdown for retooling purposes.

    • 0 avatar
      redav

      No, plenty of people here think not having “representation” is good. However, the article explains the tight spot that VW corporate is in & how much power their other unions have. Essentially, factions within the company that are not under VW’s control intend to starve the Chattanooga plant if they don’t unionize, regardless how much the VW CEO may want to move production there.

    • 0 avatar
      th009

      Are you saying that having representation would be a bad thing for the workers?

      Because the company seems to view it as being a good thing.

      And, yes, VW does plant shutdowns quite easily for new models.

    • 0 avatar
      FirebombDetroit

      Competence doesn’t require collective bargaining.

  • avatar
    Yeah_right

    I don’t follow how VW would be able to force their employees into a union in a right-to-work state any more than the UAW could.


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