AFSCME 3357-HOF'S BLOG

UAW/Chrysler Have a Deal - A Secret One

If you blinked you missed the strike, which lasted all of about 5 hours on Wednesday. Now there's a tentative deal, but two days later, there's not much info available on what the deal includes. Here's a link to what the Detroit News has published, but don't feel like you have to click on it, because it doesn't say much. Yeah, there's a VEBA, but at 55-60% funding as opposed to the GM deal which funds at 70% if everything goes right. Yeah, there's a two-tier wage scale, but nobody is saying what those wages are. Yeah there are job guarantees, but not for any particular plant. For my UAW-LSP readers - what about legal services? No information.

I'm guessing the UAW has put a clamp on disclosure of the terms while they spin up the hype machine in anticipation of a ratification fight. There's no question the union had to give up substantial ground, and they were working from a weak bargaining position. The rank and file is not likely to be pleased. It looks to me though, that this fight may have been lost when Chrysler was spun off from Daimler Chrysler. The resulting entity was undercapitalized, with an aging product line and very few replacements in the product pipeline. Chryslerberus was not in a position to guarantee replacements for given plants when the replacements have not been designed or projected.

The Chrysler of 2007 looks a lot like the American Motors of the late 1970s. AMC was reduced to rebadging the Gremlin as the "Spirit" and putting 4WD on the Hornet and calling it the "Concord". In the end, they weren't fooling anybody. In 1979 AMC was purchased by Renault, which saw value in Jeep and wanted to enter the American market. Things didn't work out, and in 1987, Renault's interest in AMC was bought out by a resurgent Chrysler. Renault has been doing well in Europe in recent years and is looking to re-enter the U.S. market. It would be ironic if Cerebus sells Chrysler to Renault.