Bargainers for UAW, Big Three Automakers Continue Weekend Talks on New Agreements

DETROIT September 7, 2003; John Porretto writing for the AP reported that contract negotiations between the United Auto Workers and the Big Three automakers remained brisk Sunday as the sides worked to reach agreements before the current pacts expire in a week.

Spokesmen for General Motors Corp. and DaimlerChrysler AG's Chrysler Group said bargainers met through the weekend, but they declined to discuss details.

Ford, GM and Chrysler are seeking contracts with more flexibility in areas such as compensation and plant work rules that would allow them to better compete with foreign automakers.

The current contracts, negotiated in 1999 during better times for the industry, included 3 percent annual pay hikes, a ban on plant closings and nearly cost-free health care.

In a recent research report, Morgan Stanley analyst Stephen Girsky said the auto companies would like to have more flexibility regarding plant closings before agreeing to further moratoriums. Girsky estimated the Big Three would need to shut as many as 10 North American plants "to move supply-demand into better balance."

So far this year, U.S. sales at GM, Ford and Chrysler are down nearly 5 percent from a year ago. At the same time, Asian automakers, which continue to add new models and manufacturing capacity in the domestic market, have seen their volumes rise 3 percent. European brands are up 1 percent.

The UAW and automakers have been negotiating since mid-July on issues such as wages, jobs, health care and pensions that affect 300,000 workers and nearly a half-million retirees and their spouses.

Typically, the union reaches a deal with one automaker and the others follow the resulting contract terms. UAW President Ron Gettelfinger has yet to announce a company to lead negotiations.