Reports have surfaced in London that Italian automaker Fiat is ready to walk away from the Chrysler deal. The bone of contention is high labor costs. The Italian firm has given the U.S. auto firm and Canadian and American labor unions until the end of the month to "significantly reduce labor costs." This revelation was made in an interview of Fiat's CEO Sergio Marchionne in the Canadian newspaper the Globe and Mail. Fiat wants Chrysler to lower the labor costs to Japanese and German plants levels. The problem facing Chrysler is that the deal with Fiat is its last chance to stay out of bankruptcy. With Fiat ready to walk away from the deal, the North American unions had better agree to the demands or face some job losses. Let's not forget that Chrysler was given 30 days to complete the merger with Fiat or the American firm would be cut off from the government funding it is currently existing on.
Marchionne has one major thing working in his favor -- time. As the end of April looms, I have a feeling that the unions will understand their members face unemployment and may give in to Fiat's demands. We all know that unions can be stubborn, but I have a feeling that the possibility of lost jobs will outweigh the possibility of less pay.
No matter the outcome, one thing is certain: this is not the time for the labor unions to try and make a stand. If they do, we will see Chrysler forced under. I have a feeling that Marchionne will not back down as he is in the position of power here -- would you fold in poker if you held a royal straight flush? I think not. It would be best for the unions to fold and live to play another day rather than face losing it all.











Reader Comments (Page 1 of 4)
4-15-2009 @ 9:18AM
Bob said...
The long-awaited judgement day may finally have peeked over the horizon !! Will the UAW remain defiant, or will Fiat be able to accomplish something that the folks at GM and Ford have been so frustrated in doing ??
4-15-2009 @ 9:28AM
ishopsouthwest said...
Looks like Chrysler is done.
I have seen the unions help create the failures for 40+ years. Don't believe me? Look into the demise of the copper mines in Northern Michigan.
I also saw the company I worked for move its whole operation to the Mexican border and close its plant in the midwest. Again because the unions wouldn't budge on wages.
They never believe it will really happen........then it does.
4-15-2009 @ 9:36AM
tom Williams said...
If Chrysler goes under and GM goes into reorg., the UAW is done !
4-15-2009 @ 9:48AM
Bob said...
I may actually be able to AFFORD a new GM car some day !! Who would have thunk it possible ??? And, it might have taken an Italian to do it !!
4-15-2009 @ 9:54AM
Larry Klamerus said...
Hang in there a little longer all you UAW auto workers, and you'll be headed for the bread line.
4-15-2009 @ 10:09AM
Brudele12 said...
I am a UAW supporter and thank God we have them. With out the unions in this country there would be no jobs, and fairness at all for the workers. The republicans would like to see the UAW and all of the companies that support them fail and be wiped out. That will never happen my friends, the brothers and sisters are much stronger than that and will stand together. The labor unions did not break the automakers it was the Management that filled there pockets and miss used the workers and there money. So go smoke that stuff somewhere else. Your are jealous loosers. Trying to destroy the American Dreams...
4-15-2009 @ 10:16AM
royal said...
Unions have just about acomplished thier goals--putting their members out of work and companies they work for out of business.
4-15-2009 @ 5:52PM
sheag said...
the unions are the reason why everything we buy cost so much.i know of an autoworker that gets 92 dollars an hr,he has to make that much to pay his union dues therefore driving up the cost of vehicles,if you took the union cost out of the vehicle manufacturers, you could take 12,000.00 of the price of each vehicle made
4-15-2009 @ 12:11PM
Leon said...
I'm a union carpenter, lets just get that out there first off. And I am in financial trouble because of this downturn in the economy.
I don't know from the article what concessions they want but if every union says no to any and all offers to be more competitive then we have only ourselves to blame for being out of work.
The idea is to have a fair wage. However, we are dealing with a WORLD market now so we are forced to compare apples and oranges. Other countries do NOT have the benefits we do. They do NOT have the bloated economy we do with the standard of living that we have become accustomed to.
One communication union was asked to take 1 day off each month and freeze wages for a time. That to me seemed somewhat reasonable way to keep people working. The union delegates said NO WAY! (wrong choice guys)
Do they keep their houses? YUP!
The postal service wanted to stop delivery on Sat. Is that a reasonable course of action? YES
That said, it should be noted that the private sector remains uncontrollable for the most part when it comes to pay.
I think that we are going to relearn a lot of lessons as a country. The lessons that are the most painful are the lessons we remember. This isn't a time for blame. It's a tough time of finding a way to not loose what we have, keep working and learn.
I can only hope that no one looses their home learning them, myself included.
4-15-2009 @ 10:32AM
ladywiccan47 said...
the unions were great when they were first formed, got better working conditions and decent wages, but since the government has passed labor laws, the unions have become a drag. I will not work in a union controlled plant, to pay a rep for sitting on his a$$ and collect on my dues
4-15-2009 @ 10:36AM
rivrjet said...
Its people like you that think the auto industry recieved a bail out instead of a loan If the UAW goes so does all your wages idiots
4-15-2009 @ 10:40AM
pd39 said...
Chrysler should cancel the Fiat merger, give all it's employees a choice: quit the UAW and keep your job or stay union and they can find you a job. Chrysler can reorganize, cut payroll in the main office and on the floor by as much as 50%, and survive and even thrive. The cost of dealing with the UAW has driven up the number of unnecessary employees in both the office and the floor, and led to drastic increases in costs and drops in production. Get rid of the UAW and things will improve for workers and bosses. 90% of the crap that caused the formation of unions is now covered under federal labor laws and punishments for violation are a lot worse than anything the union could do.
4-15-2009 @ 10:37AM
Duke said...
I just don't understand Gettlefinger. He will cause the loss of thousands of jobs because of his arrogance and belligerence. Working for that $14.50 instead of $28.00 plus bennies costing an extra $35.00 or so, an hr., is better than flipping burgers for $7.50 an hr. I just don't get it. Is Gettlefinger trying to call Obama's bluff? Is Gettlefinger that sure that Obama will not stab the unions in the back and let them keep their wages while Chrysler and GM stay in business on the taxpayers dollars? Has anyone ever heard a UAW memeber cry crocodile tears saying they can't survive on $14.50 an hr.? Good lord are those UAW workers brainwashed. I live on $12.50 an hr., live in a small modest house, and don't spend money on toys or luxuries. I have a savings in case I lose my job, and have my car paid off. It is an old 1993 Pontiac Grand Am but, I am not interested in keeping up with the Joneses either. Those UAW workers can keep their jobs and live on half of what they do now. They can pay higher co-pays and do away with pensions. They can get 401 K's and be like the majority of America is. They can sell their huge houses, Harley's, hot rod's, boats, ATV's, SUV's, motorhomes, cottages, gun collections, hunting cabins, timeshares, and other toys to live within their means. It will keep their jobs and keep American made cars coming off the assembly line.
4-15-2009 @ 10:47AM
Escalonz said...
The Italian firm has given the U.S. auto firm and Canadian and American labor unions until the end of the month to "significantly reduce labor costs."
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So much for unionism as the global economy makes it obsolete? Just one more thing disappearing.......
4-15-2009 @ 10:49AM
Mel Sitzberger said...
It's about time someone stands up to the unions in this country. Unions strive on employees pay to survive. I have been a union member in the past and have been a victim of closing employment. The unions never support any type of employer closing. This is one of many reasons the car manufactures are struggling to keep in business. The overhead of pay, benefits, strike pay is dragging them under.
4-15-2009 @ 10:52AM
william said...
30 years Chrysler was bailed out and they haven't learned a thing,,,,,this will be the end of them....thanks management and UAW, neither has learned that living within you means is better than no means at all. I just hope the taxpayers don't have to bail them out again..
4-15-2009 @ 10:51AM
Davey Crocket said...
Funny thing is that before oil was manipulated up to $147, caused hyper inflation, and more reason to outsource our jobs over seas, why havn't the UAW set up camp on the White House steps and demand that Goldman Sachs & the oil companie give back the money that they ripped us off with their peak oil lies and destroyed the BIG 3 in the USA. Funny how GM & Ford are extremely successful all around the world except the USA? Sounds like another K Mart scam to bankrupt our valuable assets over an incident that should be illegale? I guess the mob rules....and whats next?
4-15-2009 @ 12:11PM
Leon said...
Ladywiccan47?
Since you won't work a union job because you have to pay dues
($25 a month! Oh My!) you ALSO don't get to work with an expansive group of people that have spent most of their lives learning to (in my case) build so many of the buildings you walk into every day. You also shouldn't be bothered by Unions teaching their guys, old and new, all the things they need to know to keep that roof from falling on your head at the mall you shop in or the office you work in or the bridge you drive over.
After you've walked in in union shoes I'll give your comments more credence. Leon
4-15-2009 @ 10:55AM
gilbert morrow said...
Fight them UAW , refuse to give in !
Just think I will get to see the death of the UAW , and it disbanded and dismantled .
A small car that will barely hold a bag of groceries cost $18,000 and a mid sized will cost you $30 to 40 Thousand , in some parts of the country you can buy a house for that , see something wrong there ?
4-15-2009 @ 10:58AM
Escalonz said...
If the UAW goes so does all your wages idiots
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As an idiot I'd like to remind you that if there is no company/jobs there is no need for unions, however, painfully understand your feelings.