FUCK THE UNIONS: Chrysler Workers Strike as Talks Fail to Yield Accord

Chrysler LLC's U.S. factory workers went on strike today after the United Auto Workers union failed to reach a new contract agreement with the third-largest U.S.- based automaker.Workers at all but five of Chrysler's UAW-represented plants began walking off their jobs at the 11 a.m. New York time strike deadline, according to a UAW memo. Bargainers negotiated after the strike began and then took a break, a person familiar with the situation said. This workers are earmnings between $50-$125 an hour!. The UAW struck General Motors Corp. for two days last month. That walkout ended with an historic agreement that would allow GM to shed $50 billion of future health-care obligations in exchange for job-security pledges. Chrysler, now controlled by Cerberus Capital Management LP, is wrangling with the union over the same issues.
Chrysler may be less able to make job guarantees because ``their outlook for products and what plants they may be using may not be as strong as General Motors','' said Catherine Madden, who studies automakers' vehicle plans for Global Insight Inc. in Lexington, Massachusetts.

The strike is the union's first at Auburn Hills, Michigan- based Chrysler in a decade. The union represents more than 45,000 hourly workers at the company.

UAW President Ron Gettelfinger sought a Chrysler accord that closely follows the GM pattern. That agreement allowed the automaker to shift its retiree health-care obligations to a UAW- run fund and pay new workers lower wages.

``If the UAW makes an issue of job security, that will be met with some resistance by Cerberus,'' said Patrick O'Keefe, principal of consulting firm O'Keefe & Associates in Bloomfield Hills, Michigan, whose clients include auto-parts makers.

`Major Test'

The Chrysler talks marked the union's first negotiations with an automaker owned by a private-equity firm. Cerberus acquired 80.1 percent of the company from Daimler AG in August.

``This is a major test for whether private equity thinks U.S.-located manufacturing is even feasible,'' said Sean McAlinden, an analyst at the Center for Automotive Research in Ann Arbor, Michigan.

The UAW turned its attention to Chrysler on Oct. 5. The union's previous contracts with Chrysler and Ford Motor Co. expired Sept. 14, and had been extended while the union worked out the GM contract. Ford's contract remains extended.

The three companies, battered by Japanese rivals Toyota Motor Corp. and Honda Motor Co., lost a combined $15 billion last year, including $680 million at Chrysler.

Michele Tinson, a Chrysler spokeswoman, declined to comment. Roger Kerson, a UAW spokesman, didn't return a telephone message seeking comment.

Already Closed

Of the five plants not affected by the walkout, four had been shut temporarily because of declining sales.

Factories not affected by the strike include a Belvidere, Illinois, plant that makes the Jeep Patriot and Compass sport- utility vehicles; a Newark, Delaware, factory that makes the Dodge Durango and Chrysler Aspen SUVs; and a Warren, Michigan, plant that makes the Dodge Ram and Dakota pickups.

Also unaffected are two plants in Detroit that make the Viper sports car and Jeep Grand Cherokee.

Under the union's contract with the company, members who are laid off receive 95 percent of their take-home pay. Workers who strike aren't paid and draw from the union's strike fund.

``We didn't want to go on strike,'' said Richard Buletta, 54, a tester at Chrysler's assembly plant in Sterling Heights, Michigan. ``It will start to become a worry if it stretches out awhile.''

GM's Contract

GM will put $29.9 billion into a retiree-health trust fund that takes effect in January 2010, according a union summary. GM will continue to pay retiree health-care costs at the current rate, estimated to total $5.4 billion, until the fund takes over, the UAW said.

GM's tentative contract includes no basic wage increase. Workers will get a $3,000 bonus in the first year and lump-sum bonuses equal to 3 percent of wages in the second year, 4 percent in the third and 3 percent in the fourth.

GM workers conclude voting for the agreement today. U.S. workers from at least 28 locals had approved the contract, according to a Bloomberg tally, while at least five had voted against.

Retiree Costs

Retiree medical liabilities at GM, Ford and Chrysler totaled $114 billion at the end of 2006.

The U.S.-based companies said the retiree-health costs are part of the reason they must pay $25 to $30 more an hour for American factory workers than Toyota and Honda pay at their U.S. plants.

Chrysler also wants the UAW to match health-care concessions the union granted to GM and Ford in 2005.

Under those agreements, active workers directed a portion of future wage increases to a health-care fund. Retirees paid as much as $752 a year per family for medical coverage; they had no out-of-pocket expenses before.

The UAW declined to grant the givebacks to Chrysler after only 51 percent of Ford workers ratified the health-care concessions.

Chrysler's last UAW strike came in 1997, when a 27-day walkout at a Detroit axle plant shut down one-third of its North American factories and cost $300 million in profit.

Since then, Chrysler has been sold to DaimlerChrysler AG and then shed to Cerberus.

``The mood inside is glum,'' said Daniel DeLalla, 52, an assembler at the Sterling Heights plant. ``I'm worried about this new company. I'm afraid they are going to strip us apart and shut us down.''