#Uaw

The United Auto Workers will, for the first time since 1967, ask their membership to pay a 25 percent increase in dues to the union in order to shore up their strike fund and fight for better contracts, a move outgoing UAW president Bob King believes the membership will overwhelmingly support.

Workers at Tesla’s Fremont plant celebrate the 1,000th Model S body built, 2012.

United Auto Workers president Bob King has said that the labor union is interested in organizing Tesla’s assembly plant in Fremont, California and that a group of workers at the site have set up an organizing committee for the UAW. That factory is where Tesla assembles the battery powered Model S. Tesla has prided itself in being different from Detroit and its headquarters’ location, the Silicon Valley, is not exactly a labor hotbed.

Fiat SpA said on Wednesday that it has signed an agreement to buy the remaining 41.5% stake in Chrysler that it does not own from the United Auto Worker’s retiree health-care trust, known as VEBA, for $3.65 billion in cash up front and another $700 million after the deal is completed. The agreement will allow Fiat and Chrysler CEO Sergio Marchionne to realize his dream of creating a global automotive group out of the two companies. The joint automaker would be the 7th largest in the world.

Fords are loaded for export at the Port of Baltimore. Photo: Bill McAllen / Port of Baltimore

When most people think about countries that export cars one name that’s usually not on their list is the United States, but the U.S. is exporting more cars than ever. According to the Detroit News, the record total this year is likely to reach 2 million units and perhaps even more surprising than that number if the fact that half of the exports are cars made by GM, Ford and Chrysler. The remainder come from assembly plants located in the U.S. owned by German, Japanese and Korean automakers. Cars are the most valuable manufacturing export from the U.S., followed by aerospace. Spurring the growth in exports is the fact that the United States is currently one of the less expensive places to build a car, due to favorable currency exchange rates and reduced labor costs.

Bloomberg is reporting that Fiat CEO Sergio Marchionne has resumed talks with the UAW’s retiree health care trust (aka VEBA) to buy the 41.5% of Chrysler that the Italian automaker doesn’t yet own. Fiat executives met last week with the trust’s representatives. The proposed initial public offering of Chrysler stock has been delayed for tax reasons until next year, creating a window of opportunity for a deal. Differing valuations on the stock prompted VEBA’s demand for the IPO, which would establish a market price for the stock, most likely more than Marchionne and the Agnelli family that controls Fiat want to pay.

Norwood Jewell, a nominee to become a UAW vice-president, said that the autoworkers want to eliminate the two-tier wage system that pays new hires at a lower rate than higher seniority workers. The wage system was agreed to by the union to help the domestic automakers as they went through financial troubles when the economy turned down in 2007. New workers are paid slightly more than half of what veteran autoworkers earn.

“The international executive board hates two-tiers,” Jewell told Automotive News at a General Motors Co plant in Flint, Mich. as the automaker was announcing $1.3 billion in investments in some of its plants in the U.S. midwest, mostly in Michigan. Jewell is currently director of UAW’s Flint region. “We didn’t do two tiers because it’s a wonderful thing,” he said, explaining that the financial circumstances six years ago more or less forced the two tier wages on the union. “We hate them. We intend to eliminate them over time.”

Though Chrysler-Fiat CEO Sergio Marchionne had previously said that an initial public offering of Chrysler stock could take place by the end of 2013, the Italian automaker announced that stock sale will not take place before the new year. “The Board of Directors of Chrysler Group … has determined that it will not be practicable for Chrysler Group to launch and complete an initial public offering prior to the end of 2013,” Fiat said in a statement.

With United Auto Workers president Bob King restricted by union bylaws from being reelected, the union is preparing to select his replacement. Industry watchers expect UAW secretary-treasurer Dennis Williams to be selected next month at a meeting of the UAW’s administrative caucus. Since all but one UAW presidents have been selected by the administrative caucus, the move will likely pave the way for Williams to succeed King, whose term ends in nine months. Before taking the national secretary-treasurer position Williams was the union’s Chicago area regional director.

The UAW has enlisted the help of the German IG Metall labor union in its effort to organize Volkswagen’s U.S. operations. Now Fiat has apparently gotten the union that represents its Italian workers, Fim Cisl, to reach out to UAW officials in an effort to resolve the issue of just how much Fiat is going to pay the UAW’s retiree health benefits trust for the 41.5% of Chrysler the VEBA owns. Fiat and Chrysler CEO Sergio Marchionne wants to merge the two companies and that can’t be done without buying that stock. Fiat and the VEBA sides are more than a billion dollars apart.

More drama in the ongoing Volkswagen unionization fight in Chattanooga: Volkswagen USA is not keen on the union, while Volkswagen’s management board is divided on the matter. One thing that seems certain is the prospect of a secret ballot vote on the union, according to Reuters.

A group of workers at Volkswagen’s Chattanooga, Tennessee plant is circulating a petition aimed at stopping the UAW’s attempt to organize the plant.

After Fiat and Chrysler’s retired UAW workers’ health care benefits trust were unable to agree on a price for the Voluntary Employees Beneficiary Association‘s 41.5% share in the Auburn Hills automaker, at the trust’s request C hrysler has filed initial paperwork for a public stock offering to sell part of the VEBA’s stake, about 16% of overall Chrysler shares, the first time in over a decade that the public will be able to own shares in Chrysler, which formerly was wholly owned by Cerberus and before that Daimler. Fiat certainly would rather the IPO not take place now as it complicates Fiat and Chrysler CEO Sergio Marchionne’s plans for the Italian automaker to acquire full ownership of Chrysler. The benefits trust has the legal right to force Chrysler to make the stock offering so the VEBA can cash out on the shares it received in exchange for giving up financial claims against Chrysler during the company’s bankruptcy and bailout by governments in the United States and Canada.

On Friday, Sergio Marchionne, who heads Fiat and Chrysler, told reporters in Milan, Italy that he hasn’t gotten any closer to making a deal with the UAW’s retiree health care trust for Fiat to purchase the VEBA’s shares in Chrysler and take full ownership of the Auburn Hills automaker. The UAW health care trust owns 41.5% of Chrysler and the two parties have not been able to agree on a price. The trust is demanding $5 billion for its shares. Marchionne told the LaPresse news agency, concerning the UAW trust’s suggested price, “They should buy a lottery ticket.”

Reuters is reporting that in an interview with the German Handelsblatt newspaper, United Auto Workers president Bob King said that a majority of workers at Volkswagen’s assembly plant in Chattanooga,Tennessee have signed cards supporting the UAW in the creation of a German-style works council at the factory. “Yes, we have a majority,” UAW President Bob King said.