Ford Reaches VEBA Deal With UAW. Apparently

Edward Niedermeyer
by Edward Niedermeyer

Well, the headline is there and the news is there. But is it? The Freep reports that a UAW-Ford deal on VEBA has been announced by the UAW, but there’s nothing there that you can’t find in the UAW’s press release. Go figure. Sure, it may be the first reported agreement on the future of VEBA, but there’s basically nothing to go on. “We appreciate the solidarity, understanding and patience the members have demonstrated throughout the bargaining process,” says UAW President Ron Gettelfinger in his press release and nearly every news report on the item. “The modifications will protect jobs for UAW members by ensuring the long-term viability of the company.” But how? The UAW rejected stock for VEBA out of hand a few short days ago, as VEBA became the sticking point that kept union concessions out of last Tuesday’s viability plans. And like all UAW “concessions,” this one has to go to the membership for ratification. Furthermore, according to the Freep, “proposed changes to the VEBA will require court approval.” Meanwhile the only possible insight we have into the UAW’s strategy comes from a boilerplate Gettelfinger op-ed in the Washington Times. And there’s little there to indicate a VEBA deal.

“The problem,” writes Gettelfinger, “is not the level of benefits provided; it’s the number of people they are paid to. Domestic companies should not be unfairly burdened for their long history of operations here in the United States. And retired auto workers — who gave up wages and other forms of compensation in exchange for the promise of continued health care coverage — must not be abandoned at the time of their lives when their health care needs are greatest.” But why would Ford respond to these kinds of moral arguments when it’s a whisker away from bankruptcy? Oh, right. Gettelfinger wasn’t reaching out to the automakers.

“In 2006, Sen. Barack Obama proposed a solution to the twin challenges facing the auto industry. He introduced legislation titled Health Care for Hybrids, which proposed that the federal government assist the domestic automakers in meeting their health care obligations to retirees in exchange for the companies agreeing to reinvest these resources in developing and producing higher-mileage, advanced technology vehicles… Through this approach, we can ensure that retirees receive the health care they were promised and need, while at the same time facilitating the restructuring process that is necessary to make the U.S.-based companies economically viable for the long-term future.” With the UAW still looking to the government for help, it’s hard to imagine that the Ford deal (or any GM/Chrysler deal that might emerge from it) is going to be free of federal pot-sweetening. Then again, until we have the facts we can’t actually be sure.

Edward Niedermeyer
Edward Niedermeyer

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  • Dwford Dwford on Feb 23, 2009

    I think it is hilarious that again Ford beats the bumbling GM and Chrysler to solving the problem.

  • Guyincognito Guyincognito on Feb 23, 2009

    @dwford : "I think it is hilarious that again Ford beats the bumbling GM and Chrysler to solving the problem." Call me crazy but this sounds to me like Ford is angling for a backhanded bailout. Instead of meeting their obligations to the VEBA, they will shuck their responsibility onto the government. Of course, GM and Chrysler will follow. Cudos to Ford for the better PR, I guess.

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