Strike Forces Chrysler to Halt All Production

A strike by Chrysler’s 80,000 U.S. and Canadian auto workers forced the company to halt all North American car and truck production Wednesday, but union and company bargainers in both countries met throughout the day in an effort to bring the dispute to a quick end.

United Auto Workers President Owen Bieber returned to Chrysler headquarters Wednesday morning to resume negotiations on a new contract covering 70,000 Chrysler workers in the United States just hours after he held a midnight press conference announcing the walkout.

“We’re going to keep on working. I want to try to get this thing settled as quickly as we can,” Bieber told reporters Wednesday morning. “There’s still some very tough issues in there.”

Wage Hikes Sought

The major issues that remain unresolved include the union’s demands for enhanced job security and limits on Chrysler’s purchases of parts made by outside suppliers. The UAW also wants Chrysler to provide wage-and-benefit hikes to match those paid by General Motors Corp. and Ford Motor Co., but company officials said Tuesday night that the two sides were close to an agreement on an economic package before the strike began.

Wednesday evening, Bieber reported some progress in the talks, but said an agreement was still out of reach. “Job security is one of the very tough problems that’s still here,” Bieber said at a press conference. The UAW won major job security provisions at GM and Ford in contract talks last year, but has so far been unable to obtain a similar package at Chrysler.

In Canada, where the newly independent Canadian UAW represents 10,000 Chrysler workers and is bargaining separately from the American union, the two sides recessed talks for the day Wednesday afternoon with little progress reported on the key issues that led to the walkout in Canada. Those include local contractual problems at two Windsor, Ontario, assembly plants, and a few unresolved wage and non-wage issues in the national Canadian negotiations.

If Chrysler isn’t able to gain a quick settlement, however, analysts believe that the company’s profits will be devastated. Harvey Heinbach, automotive analyst with Merrill Lynch & Co., estimates that a strike in both countries will cost Chrysler about $50 million a week in lost profits. He adds that the auto maker will lose the production of 35,000 cars and trucks each week as well.

But despite the large number of workers affected, analysts say the broader economic effect of the Chrysler strike will be limited mainly to the industrial Midwest, where Chrysler’s plants are concentrated. More than 33,000 of Chrysler’s 70,000 U.S. hourly workers are in Michigan, while most of the rest are in Ohio, Indiana, Illinois, Delaware and Alabama.

Times researcher Stephanie Droll contributed to this story.