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The Journal quotes unnamed auto executives as saying that General Motors, Ford Motor and Chrysler Group will threaten the union with moving more production outside of North America unless they're able to close the gap in wage and benefit costs compared to Asian rivals such as Toyota Motor and Honda Motor.
According to The Journal, all three automakers have announced plant closings and deep job cuts in recent years, trimming more than 70,000 UAW members from their payrolls. But now they're focused on reducing the cost of the 210,000 UAW members left in their plants. Their contracts with the union expire in September.
The traditional Big Three automakers estimate their labor costs at $70 to $75 an hour, while the nonunion Asian automakers have labor costs of $40 to $45 an hour, reported the paper.
Winning the concessions from the UAW leadership and the rank-and-file workers will not be easy. While the UAW did agree to open the existing contract early to grant health-care cost savings to GM and Ford due to losses there, they did not agree to the same savings at Chrysler, because parent DaimlerChrysler had remained profitable. And the limited changes in health-care coverage only narrowly won rank-and-file approval at Ford, reported The Journal.-New York State Society of Certified Public Accountants
Posted June 15th, 2007 by Alla
