UAW Cool On Ford Concessions

Edward Niedermeyer
by Edward Niedermeyer

The tentative deal between Ford and UAW leadership has predictably run into trouble as it moves towards a vote by local leadership. Even though the deal would still fall short of the agreement reached with GM and Chrysler and Ford has sweetened the deal with $1,000 bonuses and 2,000 extra jobs, the union’s workers are spinning the deal into a union-breaking giveaway. “We just won’t have a union anymore if we do this,” a Dearborn Truck plant bargaining committee member tells the Freep. But the rank-and-file resistance is creating divisions between Ford, union leadership and workers. Even UAW President Ron Gettelfinger admits that “isn’t a concessionary agreement,” putting workers at odds with everyone else involved in negotiations. And their motivations for turning down the deal have to be bigger than mere frustration over $500m in labor savings already granted to Ford.

The UAW’s VEBA fund owns a majority stake in Chrysler and a large part of GM’s equity, meaning it’s motivations for refusing Ford equal concessions have to be seen in a troubling light. And since Ford didn’t take the opportunity to walk away from its debts on the taxpayer dime, it’s already at a disadvantage vis-a-vis its Detroit competition. If the UAW holds firm against Ford’s generous deal, what choice do observers have but to conclude that the UAW is willing to throw Ford to the wolves in hopes of improving the value of its existing equity stakes. Ford certainly shouldn’t make a more generous offer. After all, the deal that destroyed the UAW’s raison d’etre was the bailout which gave it a stake in two of its three employers in exchange for no-strike contracts. Contrary to the insistence of Ford’s UAW workers, signing this deal with Ford is the UAW’s last chance to prove it is a union and not a hostile management team.

Edward Niedermeyer
Edward Niedermeyer

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  • Anonymous Anonymous on Oct 19, 2009

    The UAW should not have given ANY concessions to Ford. *IF* Ford is doing as good as they claim they are, they should thank their employees by providing a decent wage.

  • Dimwit Dimwit on Oct 19, 2009

    Me thinks that the UAW is heading into perilous waters.

  • Varezhka I have still yet to see a Malibu on the road that didn't have a rental sticker. So yeah, GM probably lost money on every one they sold but kept it to boost their CAFE numbers.I'm personally happy that I no longer have to dread being "upgraded" to a Maxima or a Malibu anymore. And thankfully Altima is also on its way out.
  • Tassos Under incompetent, affirmative action hire Mary Barra, GM has been shooting itself in the foot on a daily basis.Whether the Malibu cancellation has been one of these shootings is NOT obvious at all.GM should be run as a PROFITABLE BUSINESS and NOT as an outfit that satisfies everybody and his mother in law's pet preferences.IF the Malibu was UNPROFITABLE, it SHOULD be canceled.More generally, if its SEGMENT is Unprofitable, and HALF the makers cancel their midsize sedans, not only will it lead to the SURVIVAL OF THE FITTEST ones, but the survivors will obviously be more profitable if the LOSERS were kept being produced and the SMALL PIE of midsize sedans would yield slim pickings for every participant.SO NO, I APPROVE of the demise of the unprofitable Malibu, and hope Nissan does the same to the Altima, Hyundai with the SOnata, Mazda with the Mazda 6, and as many others as it takes to make the REMAINING players, like the Excellent, sporty Accord and the Bulletproof Reliable, cheap to maintain CAMRY, more profitable and affordable.
  • GregLocock Car companies can only really sell cars that people who are new car buyers will pay a profitable price for. As it turns out fewer and fewer new car buyers want sedans. Large sedans can be nice to drive, certainly, but the number of new car buyers (the only ones that matter in this discussion) are prepared to sacrifice steering and handling for more obvious things like passenger and cargo space, or even some attempt at off roading. We know US new car buyers don't really care about handling because they fell for FWD in large cars.
  • Slavuta Why is everybody sweating? Like sedans? - go buy one. Better - 2. Let CRV/RAV rust on the dealer lot. I have 3 sedans on the driveway. My neighbor - 2. Neighbors on each of our other side - 8 SUVs.
  • Theflyersfan With sedans, especially, I wonder how many of those sales are to rental fleets. With the exception of the Civic and Accord, there are still rows of sedans mixed in with the RAV4s at every airport rental lot. I doubt the breakdown in sales is publicly published, so who knows... GM isn't out of the sedan business - Cadillac exists and I can't believe I'm typing this but they are actually decent - and I think they are making a huge mistake, especially if there's an extended oil price hike (cough...Iran...cough) and people want smaller and hybrids. But if one is only tied to the quarterly shareholder reports and not trends and the big picture, bad decisions like this get made.
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