Chrysler CEO Sergio Marchionne with UAW President Bob King.
United Auto Workers Union negotiators have intensified talks with the Ford Motor Co. and Chrysler Group LLC as the union pushes for settlements with both automakers.
Obstacles, however, remain including the union’s desire to win a larger signing bonus than at GM, which agreed to a $5,000 one-time payment in a tentative agreement finalized earlier this month.
The GM agreement, meanwhile, appears to be winning solid support among the rank-and-file despite concerns about the continuation of an unpopular two-tier wage program that nets new employees barely half what veteran line workers earn.
The UAW has put a focus on wrapping up Ford’s contract as soon as possible taking advantage of the relatively good relationship the two sides have long enjoyed. But negotiations are also moving forward at Chrysler despite recent news reports suggesting those talks were put on hold as the result of a dispute between CEO Sergio Marchionne and union President Bob King.
If anything, Chrysler is interested in seeing the scope of the signing bonus reduced while offsetting the increase in second-tier wages approved by GM by having Chrysler employees pay more for health insurance and doctor visits. The small maker says it has to seek additional concessions because its finances are weaker than at the domestic industry giant.
UAW president Bob King met with Chrysler/Fiat chairman Sergio Marchionne hoping to resolve the potential stand-off. The meeting had been delayed the previous week when King elected to focus on finishing contract negotiations with General Motors. By skipping the earlier face-to-face discussion King drew a strong rebuke from Marchionne in a letter that was quickly made public.
The discussions at Chrysler were apparently productive as both the company and union issued statements dismissing reports that negotiations had stalled. A report by The Associated Press had indicated the two sides were at odds over the numbers of employees collecting second-tier wages. The percentages however, are actually not open for discussion.
Chrysler can hire an unlimited number of second-tier workers until September 2015, according to the contract language approved in 2009, both sides noted. In addition, the union has already accepted that GM can hire an unlimited number of second-tier workers through 2015.
King also met with negotiators at Ford, where talks had been on hold for nearly two weeks while the GM contract was wrapped up.
The decision to focus on GM first reflected the union’s sense that the largest of the domestic makers would be willing to give the union more of what it wanted. King has said the union plans to adhere to its long-standing practices of pattern bargaining, which means all of the manufacturer are expected to sign nearly identical contracts.
But while GM may have bent on a few key issues it held tough on other matters, notably retaining the two-tier system vehemently opposed by most UAW members.
Despite such concerns, however, initial signs point to the likelihood the rank-and-file will approve the tentative agreement. Of 10 UAW locals that had voted on the GM pact by Monday all but one had ratified the 4-year contract, which covers GM’s 48,500 U.S. hourly workers.
A final tally is to be announced on Thursday.
Paul A. Eisenstein contributed to this report.