Chrysler, UAW Dream A Dream: No Strikes (and They're Out)

It’s getting to be sports metaphor time for the ChryCo deal: the fourth quarter, the ninth inning, the obese lady’s vocal warm-ups. Automotive News [sub] quotes a White House spokesperson as saying “hurdles still remain, but we remain optimistic and hopeful that something in the next many hours will get done that will provide a pathway for Chrysler’s viability without continued government assistance.” Maybe the White House should read more news. And not just assurances from the UAW’s Ron Gettelfinger who sounds downright thrilled at the possibility of seeing his union gain a controlling stake in ChryCo. No, The Detroit News points out that a grassroots UAW effort to scuttle the deal (which must still be ratified by a full union vote) is underway. “It’s time to stop the concessions. Send them back to the table. We need a week to see the agreement before the vote. Jeep workers should be allowed to vote. Vote no,” runs a letter being circulated amongst UAW workers. Why so confrontational? The (proposed) lack of confrontation.

The Detroit Bureau reports that the new Chrysler arrangement, with the UAW controlling management, is causing concerns among rank-and-file workers. Most of the concerns come from a waiver of the right to strike for several years, a move that many employees worry they “have no choice but to accept.” According to the DB, the “contract calls for binding arbitration on economic provisions for any contract negotiated in 2011. The same provision would apply again in 2015, if Chrysler still owed money to the US government, and the union wages have to be in line with those paid at other auto plants in the US . . . including foreign-owned manufacturers.” And perhaps workers should accept these terms, considering the labor relations tragedies that defined the British Leyland nationalization/restructuring/epic fail experience.

But stripping away the UAW’s most powerful tactic in exchange for union ownership raises real question of whether the UAW even is a union at all anymore. Just don’t bring that semanticist whining to UAW President Ron “I Rule You” Gettelfinger. “We fought to maintain our wages, our health care and our jobs,” wrote Gettelfinger with his union boilerplate thesaurus firmly in hand. “In the face of adversity, we secured new product guarantees, and we negotiated new opportunities for UAW involvement in future business decisions.” Translated into English, this means that the UAW effectively no longer exists, having become a management partner. The question of whom will negotiate with whom and in whose interests is unsurprisingly scaring a number of UAW members.

Throw bondholder holdouts into the equation, and you may just begin to hear the fat lady’s warbling become slightly louder.