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Latest News - May 2010

May 11, 2010
Union leader: Workers must gain if autos recover
Source: Google News
Author: Tom Krisher

DETROIT — The man expected to become the next president of the United Auto Workers says workers should share in the profits if the auto industry recovers. But he also wants to make sure Detroit automakers stay competitive.

UAW Vice President Bob King said Tuesday that unionized workers each gave up $7,000 to $30,000 per year in concessions to General Motors Co., Ford Motor Co. and Chrysler Group LLC as the companies ran into financial problems last year and in 2008.

The union, he said, made tremendous sacrifices that helped all three automakers through a crisis, working with company management to make the automakers competitive.

But often after a crisis passes, management forgets about the sacrifices, King told an auto industry conference at the Detroit branch of the Federal Reserve Bank of Chicago.

If U.S. auto sales return to pre-recession levels of around 16 million per year, King said all three will see "astronomical" profits.

"Equality of sacrifice, there's got to be equality of gain," he told the group. "It's our responsibility to make sure that in that turnaround, our members are treated fairly."

King would not talk about the possibility of further concessions to the companies when contract talks take place next year. He said much of what will be discussed depends on the economy at the time and will be decided by the membership.

The UAW, though, faces a challenge of making sure the automakers' fixed costs are competitive globally, he said.

Ford borrowed billions to stay afloat, while GM and Chrysler were forced to take billions in government aid and go through bankruptcy protection last year. Ford already is profitable, while Chrysler reported a first-quarter operating profit and GM is expected to show a profit when it reports earnings next week.

Union workers will not have job security, King said, if companies don't have enough money to invest in new products, innovation and quality.

King also called for congressional hearings on monetary and trade policies and their impact on manufacturing. He said the Obama administration, while better on the issue than other recent administrations, still doesn't have a full policy on manufacturing.

He said the government should not allow companies to move jobs out of the country, including Toyota Motor Corp., which King said is sending much of its manufacturing footprint back to Japan. In 2000, the automaker made 57 percent of the cars sold in the U.S. in the United States, but that is now headed below 40 percent.

"No other country in the world would allow Toyota to do what they're doing in moving their manufacturing footprint out of the United States," he said.

Toyota denied that figure. Spokeswoman Mira Sleilati said that last month, 68.2 percent of the Toyota vehicles sold in the U.S. were produced in North America, which includes facilities in Canada and Mexico. That was up from 60 percent last April, she said. Sleilati didn't immediately have U.S. manufacturing figures available.

Last month Toyota closed the New United Motor Manufacturing Inc. plant in Fremont, Calif., costing 4,700 UAW workers their jobs. The plant was a joint venture with GM, which pulled out last year after filing for bankruptcy protection. Toyota's remaining U.S. factories are nonunion.

Toyota made the Corolla sedan and Tacoma pickup at the plant but said in August that without GM, it could not sustain the factory. Sleilati said the company is ramping up production in Texas and Canada to make up for the closure of the California plant. Some Corolla production has gone back to Japan, but only temporarily, she said.

King was nominated in December by UAW leaders to replace President Ron Gettelfinger, who is retiring next month. An election will be held in June at the union's convention in Detroit.




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