Delegates from the United Auto Workers (UAW) will gather next week in Detroit, as the union works out its strategy to negotiate with domestic automakers for a new four-year contract. The current pact expires in September.
With auto sales firmly rebounding, the UAW is eager to win back the concessions it granted General Motors (GM), Ford Motor (F) and Chrysler over the past decade -- in an effort to help the Detroit Three better compete against increased overseas competition and combat eroding market share.
Wanting a Share of the Profits
The union's president, Bob King, elected last June, says union workers deserve a share of the profits from the car makers, now that industry is slowly recovering from the effects of the financial crisis and subsequent recession.
UAW members have given $7,000 to $30,000 each in concessions since 2005, King says. "All the sacrifices that our members made to turn these companies around were part of the process that's really led to this amazing turnaround," the union leader said in an interview earlier this year with Bloomberg News. "We want our membership to share in a very meaningful way in the upside of these companies."
This Year's Negotiations Will Be Different
Last year, both Ford and GM both posted their biggest profits in more than a decade.And though still unprofitable, Chrysler Group is on much stronger financial footing than it was just a few months ago.
Several factors, not the least of which are GM and Ford's new-found profitability, will make this year's negotiations different from previous years. For one, the Detroit Free Press notes, the union won't be negotiating nearly identical agreements with all three automakers.
Ford renegotiated contract modifications in 2009, as it sought to trim more than $500 million in annual costs. GM and Chrysler were also granted concessions as part of the companies' government-backed bankruptcies later that year. They included a clause that bars workers from striking over wages and benefits until 2015.
Union workers also agreed to a two-tier wage scale, that allows newly hired workers to paid about $14 an hour, or about half the amount earned by workers with more seniority.
King, 64, also has his sights set on organizing factories in Southern states run by foreign-based automakers, including Toyota Motor (TM) and Daimler, parent of Mercedes-Benz. The union president says he also expects to organize at least one non-union automaker this year.
Unions Back in the Public Spotlight
The UAW's three-day meeting, which begins on Tuesday, comes on the heels of weeks of protests by public-sector workers in Wisconsin, Ohio and other states, where Republican legislators have sought to limit collective-bargaining rights.
The lawmakers have argued the concessions are necessary to close budget shortfalls. But they have apparently lost the public relations battle, leading to more favorable views of union workers. Voters in Wisconsin, upset by efforts led by Gov. Scott Walker to strip state workers of their collective-bargaining rights, are gaining momentum in an effort to recall Walker along with some members of the state Assembly and Senate.
In Ohio, a recent poll showed voters backed state workers' right to collective bargaining, with 65% of them saying public-sector workers should keep the same rights they have now. The poll also showed that newly elected Gov. John Kasich, a Republican, wouldn't win a rematch against his Democratic opponent, Ted Strickland.
Rejecting 'Business as Usual'
The fallout from such much-publicized fights will likely embolden UAW members at next week's meeting to take stronger stands in winning back concessions from automakers -- and take a tougher stance with private and public employers.
For some, the effort has already begun.
"We must reject a 'business as usual' convention," union activists wrote in a recent letter to the UAW, "and use this important gathering to unite across every sector of our union in defense of our collective bargaining rights."
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