By on September 14, 2015

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The UAW has chosen FCA US to bat leadoff in the union’s contract talks with the Detroit Three, prompting CEO Sergio Marchionne to forgo Frankfurt.

The move by the union to go after the weakest of the Detroit Three is meant to establish how all of the contract talks this month will proceed, Automotive News writes, with the possibility of striking out should the union not receive what they seek; the last UAW strike occurred with General Motors in 2007.

Part of the decision may lay with FCA’s extensive employment of Tier 2 workers, with 45 percent of the automaker’s 37,000 hourly employees working for entry-level wages and benefits. The overall goal for the UAW is to close the gap between the two-tier wage system among the Detroit Three, with increasing Tier 1 wages and establishing a health care pool also on the table.

One result of the union’s decision, according to The Detroit News, is Marchionne’s withdrawal from the second media day of the 2015 Frankfurt Auto Show this week to focus on the upcoming talks. Marchionne is alone in his decision, however, as General Motors CEO Mary Barra will make her scheduled appearance.

Photo credit: FCA

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17 Comments on “FCA US To Bat Leadoff In UAW Talks, Marchionne To Miss Frankfurt...”


  • avatar
    highdesertcat

    Fiatsler will be the toughest nut to crack for the UAW. The UAW fears and loathes Sergio. And they have good reason to. Sergio did what he wanted to do with Chrysler’s carcass and the UAW had no say in it.

    I hope Sergio moves more production outside the US, like to Mexico, Brazil, China, India, etc

  • avatar
    360joules

    I usually agree with you, but after this post and years of you bragging about paying people or being paid under the table, I hope a SWAT team of IRS agents smothers you and your Realtor (sic) wife. What a creepy post.

  • avatar
    Waterview

    I’m hopeful that both sides can come to a relatively quick agreement so jobs aren’t at risk. I’d love to see the unions agree to a lump sum bonus approach based on corporate profits rather than building in higher fixed costs that will ultimately kill the business. Profit sharing arrangements could give everyone a chance to “win”.

  • avatar
    Xeranar

    Marchionne is clearly in a position where he wants to work with the UAW than try to run roughshod over them. Just about everything he’s said and done thus far has been in promotion or cooperation with them. HDC is talking completely out of his behind if he thinks that FCA is planning some full-frontal assault on them. It’s clear that Marchionne if anything knows that the UAW has a fair chunk of GM still (little less than 20%) and the Canadian unions own another 7% or so. So if he works a deal in which the UAW gets a better cut they’re inclined to go along with FCA on most boardroom moves if FCA can get that 24-30% of GM they need to get majority by acting in coalition.

    His historic stance of not being overwhelmingly anti-union mixed with his goal of GM control/merging/ownership makes him far more likely to work a deal with the UAW than try to outright browbeat them.

    • 0 avatar
      highdesertcat

      “His historic stance of not being overwhelmingly anti-union mixed with his goal of GM control/merging/ownership …”

      Xer, that’s an excellent dissertation because if there is anything Sergio really, really wants…. it’s control of GM.

      Frankly, I could see a scenario where Sergio would work a deal with the UAW in return for their support of a hostile takeover of GM.

      We live in wondrous times. Who could have foretold or even forecasted the success that dead-Chrysler would enjoy under the reigns of Sergio?

      • 0 avatar
        Xeranar

        It’s a situation where GM owned the market due to protectionism and laid back on their heels for a very long time. They as a corporation have been ripe for takeover for some time (really since the 1990’s) and FCA is in a position to assert that move. I don’t think it’s a great one nor do I suspect it would get past regulators unless FCA basically planned on keeping much of the industrial infrastructure intact (which is unlikely).

        Regardless of Marchionne’s desires for GM he’s got a track record of being able to work with unions so he’s inclined to get his way and benefit within his greater scheme.

        • 0 avatar
          highdesertcat

          My sentiments exactly.

          I also do not believe for a New York minute that the US gov’t will allow GM to be taken over/merged with Fiatsler.

          And I have said so several times before, elsewhere on ttac.

          But I am pro-consolidation in the “US auto industry.”

          With Airbus now setting up shop in Alabama, not in union-country, I see where the Europeans are looking more favorably at investing in America, largely due to the Euro/Dollar differential and less interaction with unions.

          I hope Sergio realizes his vision of consolidation in the global auto industry.

          My fervent hope is to see greater investment in America’s labor force, albeit in non-union and right-to-work states.

          • 0 avatar
            Xeranar

            Except that Airbus is building planes in warmer climates where they’ll enter service quickly due to transportation hubs. Yes, Atlanta, Georgia isn’t a hotbed for union activity but the shift in demographics makes it a really bad place to build a huge industrial center if you think you’re not going to be unionized in a decade. This was more logistics than avoiding unions.

            You build plants in Spartansburg, SC or Chattannooga, TN if you want to capture a weak dislocated population to exploit.

          • 0 avatar
            highdesertcat

            “Except that Airbus is building planes in warmer climates where they’ll enter service quickly due to transportation hubs”

            The Airbus CEO said on Bloomberg this morning that they had done the same in China and it was a great success.

            The reason Airbus is building in America these days is because most of the production will actually be used by American carriers within America.

            The first Airbus will fly out of Alabama in the Spring and 48 are slated to be built every year.

            Boeing did the same in SC, but in Boeing’s case they did it because of the problems they had with the union in WA.

            I’m all for more foreign manufacturers opening plants in America providing jobs for Americans but the Unions would not be happy with these jobs for Americans, unless of course, they were UNION jobs.

          • 0 avatar
            Xeranar

            I think you misunderstood what I meant…but yeah, I literally said that’s why they’re building them here. Decentralized production is nothing knew in large physical goods makers. There is a reason why most auto makers build certain cars/SUVs in certain regions.

            As for wanting them to be union jobs? Eh, I always want them to be union jobs and frankly I don’t think you have an argument on why industry-wide workers unions wouldn’t want the same. But you of course make a sinister turn with your presumptions (because, well…that’s what you do.) But again, they chose poorly if they think Atlanta isn’t going to be an unionized plant in the next two decades.

            Really if this next election ends up with a Democrat in the white house (and all signs say yes) then it may be a moot point as the string of corporate victories will dry up rather quickly when Scalia and Kennedy retire and are replaced by two much more liberal justices who support the NLRB.

          • 0 avatar
            highdesertcat

            The future of America belongs to the young and those who are going to pay for it. I’m done. You can stick a fork in me.

            America always gets exactly what it deserves, because we vote for it.

            Hey, I got mine. That’s all that matters to me. Gave away my last UAW-made vehicle this past June. We’re an “all-Toyota all-the-time” family now.

            Since my wife and I fully retired on 1 Jan 2015 we spend roughly half our time in America and the other half outside of America, so I have no vested interest in whatever direction the voters choose to go. I say, “Bully for them – Let them pay for it!”

            If I’m in the US on voting day, I’ll vote. If not, no big deal.

            I think a Joe Biden/Hilary Clinton ticket would be a slam-dunk with a huge chunk of Independents like myself voting for them.

            The Republicans have no electable candidate.

  • avatar
    dwford

    Makes sense. Sergio has said in the past that the 2 tier wages should be eliminated, which the union really wants.

  • avatar
    tomLU86

    Sergio’s genius is in extracting huge amounts of money from taxpayers and shareholders by perpetuating the perceptions that thanks to him, Chrysler has turned around, and he is a deep thinker.

    Puhhhhlll-ease!

    I’m sure any one of Chrysler’s sr execs could have done as well, and Lutz would have done better.

  • avatar
    zip89105

    Looks like the union doesn’t want much this time around. I suspect there will be a quick agreement and business as usual. I doubt they’re going after Marchionne due to prior statements.

  • avatar
    Civarlo

    “You build plants in Spartansburg, SC or Chattannooga, TN if you want to capture a weak dislocated population to exploit.” So says X here.

    Hey X, for all the crowing and chest-thumping that you do about your academic pedigree, you sure could use a brush-up on your geography or basic spelling. It’s -Spartanburg-, SC. Look it up.

    Come out from behind your avatar with a real name and face, and you’ll likely find out quickly how “weak” the people of those cities are NOT.

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