UAW: CAN IT SURVIVE?

Layoffs-organizing-failures-globalization
****special report: first in a three-part series****
1.53M Members in 1979
557K Members in 2005


About this series:

Today : As UAW leaders prepare to meet in Las Vegas next week, the union is struggling to hold the line in the face of unprecedented challenges.
Friday : Ron Gettelfinger, a tough, pragmatic former line worker, is leading the imperiled union at a time of great change and uncertainty.
Saturday : From Grand Rapids to Kokomo, Ind., a grassroots dissident movement is challenging the direction and leadership of the UAW.


Giving ground

As Detroit carmakers and suppliers have pushed to streamline manufacturing and cut costs to compete with more efficient foreign rivals, the UAW has been forced to surrender hard-won benefits to save jobs. Key examples:

In ground-breaking deals last year with GM and Ford, the union agreed to let retirees start paying health care premiums, co-pays and deductibles , while active workers sacrificed future pay raises to help pay for their medical care. Now, an individual retiree will pay up to $370 a year for health care and a retiree with a family will pay up to $752 a year. The union is still in negotiations with Chrysler.

In a historic concession in 2004, the UAW agreed to establish two-tier wage structures at Delphi Corp. and Visteon Corp. to help bring labor costs at the financially struggling suppliers in line with competitors. Under the plan, new hires start at $14 an hour and can reach a peak wage of $18.50, depending on their job. That compares to veteran workers, whose base pay starts at about $24 and rises to $36.

The UAW won the right to represent workers at DaimlerChrysler's new engine plant in Dundee by agreeing to conditions that once never would have been considered, including Japanese-style teams and outsourcing functions unrelated to vehicle production , such as building maintenance.

The UAW has agreed to work rule changes at other plants as well, including making the work force more flexible by letting workers fill in on more than one job . At Ford's Dearborn Tool & Die, the plant's 500 workers have been reorganized into teams responsible for a particular part of production. Some workers have taken on added responsibilities as team leaders, and a few are handling duties once assigned to salaried workers.

At a new Chrysler plant in Toledo that will start building the 2007 Jeep Wrangler this fall, the UAW agreed to let independent suppliers -- many of them nonunion -- run the factory's chassis line, body shop and paint shop with their own employees .
Source: Detroit News research













Thursday, June 08, 2006


Special Report

UAW: CAN IT SURVIVE?
Union struggles to maintain hard-won gains
Bill Vlasic / The Detroit News



COOPERSVILLE -- For 25 years, the United Auto Workers union has been an unshakeable pillar of the middle class in this small city in western Michigan.

But the end is drawing near, and a way of life is under siege as never before in the 71-year history of the UAW.

The fuel-injector plant on the edge of Coopersville is one of 21 U.S. factories targeted for sale or closure by Delphi Corp., the bankrupt auto parts giant that is testing the resolve of the UAW to preserve jobs, wages and benefits.

The challenges to the UAW, however, don't end with Delphi. Both General Motors Corp. and Ford Motor Co. are shuttering factories to cope with losses in market share to foreign automakers. Auto parts production is moving in waves to low-wage nations. Nonunion "transplant" factories owned by Asian and European manufacturers are flourishing from Indiana to Alabama.

As UAW leaders from across the nation prepare to meet Monday in Las Vegas for the union's constitutional convention, the very future of the union is in question.

With its membership in steady decline and Detroit's Big Three automakers continually losing ground to Asian competitors, can the UAW hold the line and preserve the hard-fought gains of decades of collective bargaining?

In Coopersville, where 560 UAW members produce up to 100,000 fuel injectors a day, the view from the shop floor is a mix of hope and resignation, optimism and anger, faith and cynicism.

"I believe our union will grow," said Robert Betts, president of UAW Local 2151. "It's like the Romans. The more they persecuted the Christians, the more the faith grew."

But with the specter of Delphi's bankruptcy reorganization hanging over the plant, Jim Grego can hardly agree with Betts.

"Am I a true believer? Maybe at one point I was, but no longer," said Grego, a 25-year UAW veteran. "I'm afraid the union has sort of become a toothless dog."

Union ranks dwindle

The facts are chilling for a union once considered the paragon of muscle and influence in the American labor movement.

Since its high point in 1970, the UAW's membership has fallen from 1.6 million active workers to 557,000 last year -- a drop that reflects the Big Three's decline in U.S. market share from 85 percent to its current level of 53 percent.

The union has been unable to organize any of the transplant factories built in the United States by Toyota Motor Corp., Honda Motor Co., and other overseas automakers.

In the past year, GM and Ford have announced plans to close dozens of plants and chop a total of 60,000 U.S. hourly workers from their payrolls. Last fall, the UAW agreed to once-unthinkable concessions that force retirees to assume some health-care costs and require active workers to forgo a wage increase to help pay their medical bills.

But no event shook the union more than Delphi's bankruptcy filing last October. Delphi -- a former division of GM -- is seeking a radical restructuring of its U.S. operations that would cut more than 20,000 jobs and slash $27-an-hour wages to $12.50.

"There's little doubt that the global economy has turned a blowtorch on Detroit," said Harley Shaiken, a labor professor at the University of California-Berkeley. "At stake is nothing less than the future of American manufacturing."

Delphi's motion to have a federal judge void its labor contracts for 33,000 unionized workers hangs over the upcoming UAW convention like a black cloud.

UAW members at Delphi have overwhelmingly voted to authorize a strike in the event the contracts are thrown out. A strike would almost instantly cripple GM, Delphi's biggest customer, and possibly force the world's No. 1 automaker itself into bankruptcy.

"Delphi is the watershed event that pushed the union into uncharted territory," said Shaiken.

A strike at Delphi would be a powerful demonstration of defiance by the UAW, but one fraught with risk. UAW President Ron Gettelfinger has not ruled out a strike, even as he expresses hope that GM, Delphi and the union can negotiate a downsizing that protects workers and their pensions.

Gettelfinger faces critics

Gettelfinger has been criticized by union dissidents for working too closely with GM Chairman Rick Wagoner to shift some health-care costs onto UAW members and for accepting GM's massive attrition program that offers buyouts or retirement packages to the company's hourly workers.

Even so, Gettelfinger, 61, is expected to easily win re-election to a second four-year term as president at the UAW convention next week. He declined to be interviewed, but one of his top lieutenants defended the union's cooperative approach.

"Today, more than ever before, it takes partnerships at all levels to get the job done," said Richard Shoemaker, head of the UAW's GM division. "None of us can succeed on our own."

That philosophy angers some rank-and-file members who perceive the UAW as being in a constant state of retreat -- and unwilling to fight.

"I think Gettelfinger has pussyfooted around the issues," said Dan Lamb, a machinist at a Delphi brake plant in Dayton, Ohio. "It's time to go back to our roots, back to when the union was militant."

The union was born in conflict. Founded in 1935, the UAW's fledgling organizing efforts took off after a series of sit-down strikes against GM the following year. Union organizers fought bloody battles with security forces at Ford before the company finally agreed to collective bargaining in 1941.

Historically, the union has rarely backed down from confrontations with automakers. The most recent occurred in 1998 when the UAW waged a 54-day strike at two GM parts plants in Flint that virtually shut down the company's North American operations and cost GM an estimated $3 billion in lost profits.

But the legacy of confrontation came at a price, said one industry analyst. "The perception of this union for too long has been as confrontational," said David Cole, head of the Center for Automotive Research in Ann Arbor. "That image hurt them badly when they tried to organize the transplants."

Cole, who has close ties to GM management, views the union's more collaborative posture as a strategy grounded in the new reality of the U.S. auto industry.

"This union is fighting for its very survival," he said.

The UAW has forged some innovative deals to save auto jobs. In Toledo, the UAW allowed Chrysler to outsource key production functions to suppliers in order to get a new assembly plant built.

"We did what we had to do to get that plant," said Bruce Baumhower, head of UAW Local 12 in Toledo.

Yet the spirit of cooperation with the automakers can only go so far, said labor historian Nelson Lichtenstein.

"You can cooperate with the company 90 percent of the time, but you have to hold in reserve the ability to throw a wrench in the works," said Lichtenstein, author of a 1995 biography on legendary UAW leader Walter Reuther.

While a strike now against Delphi would be "almost suicidal," Lichtenstein said the UAW would lose its bargaining power without the threat of a walkout. "The capacity to say no is essential to making the cooperation work," he said. "It requires both sides to have a gun in the holster, and you have to use that rusty gun every so often to be taken seriously."

How to stay relevant?

The UAW leadership rarely talks publicly about the threat of a strike at Delphi. Negotiations on a settlement, in fact, have been going on quietly for several months. GM's senior executives have repeatedly said they expect the situation to be resolved peacefully.

A larger issue for the union is how to stay relevant while thousands of its members take buyouts and retirement packages from GM, and plant closings continue like so many dominos falling in a row.

Outside of its stronghold in the Midwest, the union is often perceived as anachronistic and out of touch.

But UAW loyalists are quick to point out that it was the union that pioneered blue-collar gains in areas such as job security, paid vacations, employer-funded health insurance and child-care programs.

The decline of unionism has had a direct impact on the standard of living of millions of Americans, said James Settles, head of the UAW's Region 1A in Taylor.

"You see the erosion of the middle class," said Settles, who is expected to be elected a UAW vice president at next week's convention. "The erosion is because of the erosion of the unions."

The future of the UAW, Settles said, is tied to its ability to organize other professions beyond its automotive base.

Only 58 percent of its membership is auto-related, the result of successful organizing drives of teachers, public-service workers and health-care professionals.

The unprecedented "special attrition program" to shed workers at GM and Delphi is shaping up as the largest exodus of hourly workers in automotive history.

Nearly 130,000 GM and Delphi workers are eligible for early retirement packages and buyouts worth up to $140,000. An estimated 20,000 workers at GM and almost 10,000 at Delphi have already accepted the deals, which expire June 23.

Workers' lives upended

Workers in the plants are grappling with decisions many never thought they would face.

"People are making snap decisions because they don't know what's going to happen to their jobs down the road," said Ed Pietrowski, a Delphi worker in Lockport, N.Y.

The idea that UAW members are gratefully accepting buyouts and retirements is a false one, said Jonell Sayles, who retired last month after 30 years with GM and Delphi in Flint.

The bitter truth, Sayles said, is that GM's sinking fortunes are forcing workers to leave under duress.

"I worked for GM for 25 years before they spun us off to Delphi," said Sayles. "Is it my fault that GM doesn't want me anymore? We are seeing a way of life unravel before our eyes."

As market shares dwindle at GM and Ford, the UAW appears increasingly powerless to save jobs from being lost and factories from closing.

Ford, for example, has announced plans to shut down its Atlanta assembly plant -- recently ranked by Harbour Consulting as the most productive assembly plant in North America.

In February, GM ceased production at its assembly plant in Oklahoma City after 27 years of operation. More than 2,200 workers were idled and put into a "jobs bank" with little prospect of ever building automobiles again.

"It was quite a shock," said Darrell Mason, who hired in when the plant opened in 1979. "We're at a crossroads. You see where the middle class is going. You see where you may be the last of the breed."

The anxiety is most acute at Delphi plants in Michigan, Ohio and elsewhere, as workers wait out hearings in U.S. Bankruptcy Court in New York to learn of their fate.

Behind closed doors in Detroit, UAW negotiators are attempting to get GM to provide so-called "soft landings" for Delphi workers whose jobs and plants are on the line.

But the bottom line is clear. Delphi is moving out of or consolidating product lines that can be made more cheaply in low-wage nations. Spark plugs manufactured in Flint with UAW labor can no longer compete with plugs produced in China and India.

In Coopersville, a modern factory with an experienced and productive work force seems destined to close, and there appears little or nothing the UAW can do to prevent it.

The plant accounts for 24 percent of the total tax revenue of the little city of 4,200 people on the western outskirts of Grand Rapids. Since 1981, Delphi has been a part of the fabric of community life, and a cornerstone of the Coopersville's economy.

"This city is going to prosper with or without Delphi," said Steven Patrick, the city manager. "But that's not to say that it isn't a traumatic time."

Delphi has said it plans to transfer fuel-injector production from Coopersville to plants in the nearby city of Wyoming and to another factory in Rochester, N.Y. The company also makes fuel injectors in China, Brazil and Austria.

Betts, the local UAW official, said more than 70 percent of the Coopersville work force qualifies for a buyout package or early retirement. Others could "flow back" into GM under guidelines negotiated by the UAW.

The plant may stay open until early 2008. Jim Grego said he will likely stay until the end of this year, then take the buyout. He won't walk out, he said, singing the praises of his union.

"I think the UAW is sacrificing Delphi and its workers to save GM," he said. "The lifestyle we all enjoyed is on its way out. I just don't think we have the power to stop it."

You can reach Bill Vlasic at (313) 222-2152 or bvlasic@detnews.com.