UAW Warns of Confrontation With Chrysler on Outsourcing

United Auto Workers leaders told Chrysler Corp. on Tuesday that it risks “a confrontation” Oct. 15 unless the auto maker places strict curbs on work subcontracted to non-union and overseas shops.

Marc Stepp, the union’s chief bargainer, said thta Chrysler makes only 30% of the parts contained in the cars that it sells. Chrysler is even financing research and development on behalf of the companies it contracts with, Stepp said. The result of this practice, known in the industry as “outsourcing,” is loss of work for UAW members, he said.

The decision to make outsourcing a major issue was revealed in a union briefing for reporters at Chrysler headquarters.

The labor contract covering 70,000 U.S. UAW members expires Oct. 15. No strike deadline has been set, and Stepp refrained from using the word “strike” at the briefing.

However, he made it clear that UAW members were angry with Chrysler’s actions.

“We are dismayed with the very callous manner in which the Chrysler Corp. has outsourced jobs,” he said, adding, “Unless we are able to reach a fair conclusion on this subject, there probably will be some kind of confrontation until this question is fully resolved.”

Stepp said the use of supplier parts has escalated in the six years that Chairman Lee A. Iacocca has run the company.

A considerable amount of factory space is being left unused because Chrysler is shipping work elsewhere, he said.