To no one's surprise, the ground-breaking negotiations between General Motors (NYSE: GM) and the United Auto Workers are going well into overtime. The contract, which expired six days ago, is being extended hour by hour as the two sides attempt to hammer out an agreement that the UAW will then use as a template in negotiations with Ford (NYSE: F) and Chrysler.According to an AP report, both sides are on the same page in establishing a Voluntary Employee Beneficiary Association (VERA) along the lines of that established by Goodyear Tire and the United Steelworkers last year. The VERA would turn over responsibility for retiree health care to the union. The two sides do not, however, agree on the amount of the contribution GM would make to the fund. GM's obligations for retiree health care is currently estimated at $51 billion, and the company reportedly proposed paying 65% of this amount into the VERA.
This is not the only contentious issue on the table, however. The UAW wants GM's assurance that it will keep building cars in UAW plants in the U.S., while GM is asking for a drop in hourly wages, larger worker contributions to health care program, a reduction in guarantees of work for UAW plants, reduced vacation time, and other cost-saving measures.
However, with 64% of UAW members eligible for retirement in next five years, until the VERA contribution is settled, no agreement can be reached. According to the Detroit Free Press' Tom Walsh, the delay works to the advantage of the union, especially if the market begins to lose confidence and GM's share price declines.
I suspect that as long as the union believes that it is making progress in the negotiations, it won't rattle the strike saber. If you start hearing its officials throwing around the "S" word, though, take that as an indication the two sides are closer to stalemate.
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Reader Comments (Page 1 of 1)
9-21-2007 @ 9:58PM
lawrie mantwell said...
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GM Leaves Fireman High and Dry!!! (Not rated) 12-Sep-07 01:35 pm It's funny after faithfully serving the community at large as a fireman for many years my husband cannot get any service in return!
I need to get this off my chest, my husband and I purchased a Chevy Silverado Duramax Diesel 2500 with the Allsion Transmission. Being a fireman for over 22 years my husband knew any truck with the Allison trans had to be great!
Problem is we have had a total of four sets of injectors replaced in this truck, the last set only lasted little over 5600 hundred miles. Feeling frustrated we went to GM at the dealers suggestion and GM's only response was "sORRY YOU'RE UNHAPPY" they feel the truck has lived up to it's potential?
Each one of the GM dealerships that have worked on this truck say there is DEFINITELY A PROBLEM, they are not quite sure what this will do or has already done to other parts of the engine.
Can't sell it, can't trade it, We are just stuck!!!
88,000 miles on a diesel, and it's of no use to us. I am afraid to take it to the corner market!
We have purchased several GM products and feel with this particular truck we feel we have been treated VERY POORLY.
All we have ever wanted was for GM to stand behind their product. Consumers these days have several options and we opted to choose GM and American Made Vehicle and we have been left high and dry, feeling alone with a faulty truck!
Lawrie Mantwell
o2beclean@aol.com
9-23-2007 @ 12:04AM
jerry mcdonald said...
strike-the UAW give up their strike fund money,please!They been stealing money from the membership for years.USELESS AND WORTHLESS-UAW!They killed the UAW when they killed RUther
9-24-2007 @ 4:22PM
Al said...
When did you purchase the truck ? What year is the truck ? How long was the warrenty ? Was it under warrenty when you had the work done ? Does your state have a Lemon Law that protects consumers with cars that have to be serviced for the same problem more than 3 times ?
10-10-2007 @ 5:47PM
Lee Oeffner said...
During my 32 year career with GM we were on a number of occasions, told why we should not be talked into joining the union. (I was a salaried employee). We were told that we would enjoy all the benefits union employees got as a result of their contract settlements. This included annual raises. This was the case while actively employed. Then some employees were nudged into early retirements with the promise that all health benefits would be there for life, with no extra cost to the employee.
We all know how that turned out. Since I retired in 1992 our health cost monthly contribution has gone up considerably. I can even live with that considering the American Auto industries demise, but Ford salaried employees are losing their health care coverage beginning 2008 and I'm sure GM will follow suit before long. This is the thanks we are getting for being good loyal salaried employees and not joining the union. I don't think GM union members will lose their coverage. Guess we were suckered.
10-09-2007 @ 11:12AM
Van said...
The Union has been for the most part, very good for their members. Now it is time to contract and help the very company that helped them and the members understand this and it has happened. There is plenty of flexibilty in the new contract now for GM to move their products in and out of the system and a not have added costs in the product. Stocks will climb to $58.00 by the end of the year....
10-10-2007 @ 6:02PM
Lee Oeffner said...
Seems like great intelligence is what the Chrysler Union workers are using going out on strike. Earn $200.00 per week, watch their company go bottom up and go to work at McDonalds rather than give up a little so the company can survive. Yup, makes great sense. Pat yourselves on the back folks, puff out your chests and delight that you put a company out of business and then go look for a job at far less pay. Makes sense.