Thursday, June 09, 2005
UAW Jobs In Peril; Fear Grows At Delphi, Worried Union Leaders Meet Today
UAW jobs in peril; fear grows at Delphi
Worried union leaders meet today
June 9, 2005
BY JEFFREY McCRACKENFREE PRESS BUSINESS WRITER
The ongoing angst at Delphi Corp., the country's largest auto-parts maker, and the equally troubling times at General Motors Corp., which this week said it will eliminate 25,000 manufacturing jobs, are bringing UAW plant officials from across the country to Detroit today.
Their likely focus will be how and whether the UAW can help Delphi, either by allowing for more buyouts of Delphi-UAW workers, allowing for more Delphi workers to return to former parent company GM, or allowing Delphi to more quickly sell off certain money-losing plants, say three union officials who spoke to the Free Press.
One UAW official who asked to remain unnamed said a priority at this meeting will be the Delphi plants the Troy-based parts supplier has singled out as unprofitable and pushed into a separate entity that Delphi calls Automotive Holdings Group. That business unit includes 11 plants, seven of which have UAW workers. The UAW represents 7,000 of the 11,100 union workers at the 11 plants, according to Delphi.
"We need to do something for the people at those plants if Delphi wants to sell or close them," said the UAW official.
Today's meeting, at 10 a.m. at the UAW-GM Center for Human Resources, will bring together UAW plant-floor presidents and chairpersons from more than 100 GM and Delphi plants across the country. GM and Delphi management will not be in attendance, though Delphi management sent out letters earlier this week to bring some of the same UAW officials back to Detroit on June 21 for a meeting with Delphi executives, plant managers and plant-level personnel heads.
The UAW International in Detroit has refused to say why it called today's meeting, or what's on the agenda. UAW officials say they are usually told the agenda in advance.
"None of us have been told anything. They just sent the letter and told us to get there to Detroit. They've kept it a pretty good secret from us," said Dave Peterson, president of UAW Local 31 at the GM assembly plant in Kansas City, Kan.
It comes just weeks after the UAW reached a deal with struggling auto supplier Visteon Corp. and its former parent, Ford Motor Co., to bail out Visteon by allowing some Visteon employees to return to Ford and by letting 12 unprofitable Visteon plants get sold off.
Delphi, like Visteon, was separated from its automaker parent a few years back and has been unable to make much money since. Delphi makes products including steering systems and XM satellite radio.
Delphi, however, is more independent from GM than Visteon was from Ford. Most Visteon-UAW workers were entirely Ford's responsibility if Visteon failed. However, if Delphi failed, GM has only some limited obligations to guarantee pensions and health care for certain Delphi retirees -- and those obligations expire when the current UAW contract ends in September 2007.
It will cost Ford about $500 million this year alone to bail out Visteon, plus another $700 million in the future.
"People here want to hear Delphi is getting some sort of Visteon deal; who plays Ford in such a deal? GM won't," said auto analyst Robert Hinchliffe with the firm UBS. "If the union follows the Visteon precedent, some of it would allow Delphi to modestly accelerate the buyouts of some workers and the sale of some plants from the Automotive Holding Group."
Delphi, much like former owner GM, is suffering through difficult financial times.
Delphi lost $409 million in the first three months of the year, after predicting earlier it would lose $350 million for the whole year. Delphi is also in the midst of a government investigation into irregular accounting at the $28-billion company. GM, meanwhile, lost $1.1 billion in the first quarter, its worst loss in 13 years.
Delphi has about 24,000 UAW members. GM has about 107,000 UAW members.
GM Chief Executive Officer Rick Wagoner said Tuesday there was no reason to think GM was going to bail out Delphi.
"We don't see the relevance to a GM-Delphi type of situation," he said.