Auto Worker War Crosses Union Lines : As Auto Industry Scales Back, UAW Faces Unlikely Pressures to Make Concessions
Sporting company uniforms and union baseball caps on a lunch break near the General Motors truck plant here, Rick Craft and Randy Hutton don’t look like guys who just sold out the American labor movement.
But to hear workers at another GM plant on the north side of town tell it, that’s what they and 3,100 other truck plant employees did last month when they agreed to make concessions to management to rescue their jobs from the blade of GM’s restructuring scythe.
“I think it’s the pits,” said Melody Holt, who assembles the brake boosters that get bolted into pickup trucks by her neighbors five miles to the south. “They’re going backwards, settling for less than they had. And if we’re not careful they’ll drag us backwards too.”
Holt belongs to the shrinking United Auto Workers union, which represents workers at every GM assembly plant in the United States except Craft and Hutton’s Moraine truck plant. Because it once made refrigerators instead of trucks, its workers belong to the International Union of Electrical Workers.
Longtime allies, the two unions have orchestrated strikes together over the years, and the electrical workers have happily agreed to the terms of the generous contracts hammered out by the bigger and more powerful auto workers union. The unraveling of their relationship is a symptom of the enormous strain on the UAW as it struggles to emerge intact from wide-ranging assaults on its turf.
GM’s plan to wipe out 54,000 jobs by 1995 has sent the once-mighty UAW scrambling to defend what it has left against management pressures for concessions. At the same time, the union is struggling to stave off further Japanese incursions--and U.S. job losses--by helping to make the domestic auto industry more competitive.
And concern about the union’s long-term ability to compete with the lure of cheap Mexican labor has put UAW leadership at odds with one of its locals, as rank-and-file members show a readiness to make concessions to save their plant.
“The UAW has lost the ability to set wages in the industry,” said Audrey Freedman, who follows the auto industry for the Conference Board in New York. “We’re at the point where workers are competing with each other for every job, and the union can’t prevent it.”
Although IUE officials will visit UAW headquarters in Detroit this week on a peacemaking mission, universal labor solidarity may no longer be a priority for America’s fading industrial unions.
“They do what they need to represent their members, and we do what we need to represent ours,” says Ed Fire, secretary-treasurer of the IUE.
Stephen Yokich, the UAW vice president responsible for GM, puts it more harshly: “We are appalled by the IUE’s contract in Moraine.”
GM has sought to exploit the uncertain atmosphere, provocatively holding up the concessionary Moraine labor agreement as a model for its other plants. Overwhelmingly ratified by union members as the threat of closure drew near, the contract reduces job classifications, adds a third work shift and lets new hires come in at 55% of the pay of current workers. A week later, GM announced the plant would stay open.
“Obviously, threats from (GM) motivated them to accept this substandard agreement,” Yokich said.
Such fighting words bring scowls to the lips of Craft and Hutton, who consider themselves victims of a U.S. industrial decline far beyond their control. Not proud of their new agreement, they nevertheless believe that the high wages enjoyed by their generation of assembly workers is a thing of the past.
“They can knock us all they want, but we did what we had to do,” Craft said. “There’s just not going to be any more $17-an-hour assembly jobs. Otherwise, you just can’t compete with the Mexicans, the Koreans, the Japanese. Hell, you can’t even compete with Honda in the United States.”
Not yet ready to resign itself to Craft’s dire analysis, the UAW has threatened “rolling strikes” to block GM’s efforts to wring similar concessions out of the unionized plants it decides to keep open. But labor experts warn that though cooperating with GM will mean accepting fewer jobs for a smaller union, opposing the very steps that the U.S. industry seems to need to become competitive may eventually mean no union at all.
Its membership down to 900,000 from a peak of 1.5 million in 1979, the UAW is threatened by the same international forces--chiefly Japanese competition--as the U.S. auto companies whose workers it represents. Until the early 1980s, when the Big Three U.S. auto makers controlled nearly 80% of the country’s car market, the union had a near-monopoly on labor in the U.S. auto industry. Union wages, not tied to productivity, rose as steadily as did car prices in the insulated market.
But with the Big Three’s share reduced to 65% of the car market, GM has begun to acknowledge that it needs to tailor its production capacity to fit its shrunken role in the U.S. auto market. And the UAW must shrink with it.
Part of the problem is that Japanese auto makers are simply more productive than the Big Three. With five times fewer job classifications and a more flexible work force, the Japanese take an average of 17 hours to produce the same vehicle that the domestic makers build in 25.
An important part of the solution, labor experts say, is for the company and the union to work together to reduce GM’s labor costs and save U.S. jobs. But at a time when cooperation between the two appears most vital, relations between the traditional adversaries appear to be deteriorating.
Angered by the union’s refusal to reopen its contract in the face of staggering losses by its North American car and truck business ($7 billion in 1991) and pressured by Wall Street to act quickly to staunch the red ink, GM announced late last year plans for massive layoffs and 21 plant closings without telling the UAW which plants would be shuttered. The UAW’s Yokich countered by promising to veto any changes in work rules agreed to by his locals under threat of closure.
GM Chairman Robert Stempel praised the Moraine contract as a model. He also said an Arlington, Tex., plant’s willingness to adopt a three-shift work schedule had played an important role in his decision to keep it open. The day after Stempel’s comments, Yokich called a rare news conference to denounce both contracts and insist that he would not allow Arlington to go through with the changes it had promised.
At Arlington, the union would add a third eight-hour shift, keeping the plant running 24 hours a day and boosting its output by a third. At Moraine, three crews will work four 10-hour days over a six-day period, increasing production from 200,000 to 300,000 vehicles a year.
GM has been pushing for such arrangements for years, and the UAW has agreed to experiment with a three-shift schedule at the company’s Lordstown, Ohio, plant. But what the UAW fears perhaps most of all is the splintering of its union into desperate locals trading concessions for promises of jobs.
And as strike rumors fly, Moraine workers have heard that the UAW may force the truck plant to temporarily stop production. It could do that by striking Moraine’s suppliers and cutting off the flow of necessary parts. The move apparently would be calculated to express UAW displeasure with the IUE local.
“If the UAW strikes, we heard they might shut us and Arlington down out of spite,” said Dirk Webb, a pipe fitter at the Moraine plant.
Webb, whose wife works alternate shifts at the plant, says the Moraine employees would “just as soon work,” but will be unable to if the UAW cuts off parts shipments they need to keep the line moving.
But strikes are not likely to endear the union to an impatient GM management, which is under considerable pressure itself to get its company back in shape. In hopes of soothing a restless work force, top GM executives have taken a more conciliatory tone in their public comments about the UAW since the company’s February announcement. And some analysts contend that a strike would be self-destructive.
“GM is going to make itself more productive one way or another, otherwise it’s going to go out of business,” the Conference Board’s Freedman said. “Resistance on the part of the UAW is suicidal.”
The problem is that agreeing to greater flexibility may mean losing jobs, at least in the short run. The purpose of GM’s downsizing is to make the company profitable at a smaller market share. That means investing less labor in fewer vehicles for a higher return.
“Simply cooperating with GM isn’t going to save UAW jobs,” said Harley Shaiken, a labor economist at UC San Diego.
That’s a lesson Richard Ruppert, the shop committee chairman at GM’s Van Nuys plant, learned the hard way. In 1986, the Van Nuys plant workers succeeded in keeping their plant open by eliminating hundreds of job classifications and switching to more flexible work schedules.
But last year, GM announced that it would close the plant this summer. One of the car lines the Van Nuys workers had hoped to build will be assembled in Lordstown instead, since the three-shift production schedule allows for greater output at one plant.
“Our experience is, it doesn’t really make a difference how much you cooperate,” Ruppert said. “The bottom line is still profit for GM.”
As GM transforms itself into a smaller and more profitable company, a corresponding loss of UAW jobs is inevitable--and not necessarily for the worse, said Sean MacAlinden, an economist at the University of Michigan.
“GM and the UAW are in the same car. If GM hits the tree, the union’s dead,” MacAlinden said.
If the union survives the current upheaval, it may emerge as a mirror of GM: a smaller, richer union. And with GM’s operations consolidated over fewer plants, the UAW will have even more power to damage the company with a strike.
But if the union is forced to make concessions in wages and benefits in the process, it may emerge forever weakened. MacAlinden said the specter of the Moraine plant’s new contract--which would start new hires at $9 an hour instead of $17--may inspire a “nothing to lose” attitude at UAW headquarters.
“What’s the point in having an auto industry at a wage like that?” MacAlinden said.
But if such feelings lead eventually to a worsening in the UAW’s relationship with GM, they have already led to a waning of its once-amicable relationship with the IUE. The IUE’s Fire, who has participated in every set of national negotiations between the IUE and GM since 1967, said he remembers working closely with his UAW counterpart, Irving Bluestone, during the last major UAW strike against GM in 1970.
“Our relationship with the corporation was pretty much open warfare,” Fire recalled. “Several of our components plants were crucial, and we were strategizing very closely over which plants to strike and which to keep open.”
In the 1990s, though, just who the enemy is is not so clear. And truck plant worker Jim Marlow said he believes that the UAW has taken on one too many with its attack on the IUE.
“Everybody here would rather the unions get along, because that’s the only way you’re going to get anything out of the company,” Marlow said. “But it’s not working that way.”
At least two of the component plants set to close in GM’s latest round of cutbacks will be moved to Mexico, and GM’s decision to spare the Arlington plant was seen by some as part of the company’s strategy to purchase more parts from non-unionized Mexican suppliers. The company denies allegations of a “southern drift” in its operations, but the UAW and IUE view the North American Free Trade Agreement as a long-term threat to the job security of U.S. assembly workers.
Harry Katz, an expert on auto industry labor relations at Cornell University, said the union’s panic over Mexico is misplaced.
“Mexico is a diversion,” Katz said. “The UAW’s primary concern should be to find a way to successfully compete head-on with the Japanese.”
John Casesa, an auto stock analyst at Wertheim Schroder, said he believes that the union and the company have the same needs and should have the same priorities.
“If Detroit could solve its labor relations problems, nothing could stop it from competing with the Japanese,” Casesa said. “But that’s going to be a long, long, painful process.”
