American Axle and UAW reach tentative agreement

[DainBramaged]

The UAW and American Axle & Manufacturing Holdings Inc. reached a tentative contract agreement late Friday aimed at ending an 11-week-long strike that had triggered thousands of layoffs and cost General Motors at least $1 billion.

Both sides confirmed that a tentative deal had been reached to end the strike by some 3,650 U.S. hourly workers at the auto parts supplier but neither side offered details of the proposed contract.

The UAW went on strike on Feb. 26 at five American Axle plants in Michigan and New York, triggering parts shortages that shut down production at some 30 GM plants in North America and marking the start of what became one of the longest-running strikes in the 73-year history of the union.

The union said in a short statement that it would hold a meeting in Detroit on Sunday to explain the contract to hourly workers at the company's main Detroit factory.

The UAW said it would schedule other meetings to discuss the details of the agreement with workers in Three Rivers, Mich., and in New York, clearing the way for ratification votes next week.

GM accounts for about 80 percent of the revenue for the auto parts supplier, which was formed in 1994 when CEO Richard E. Dauch led a group of investors that bought the company's assets from the No. 1 U.S. automaker.

American Axle had sought steep cuts in wages and benefits for its UAW-represented workers and had been looking to cut at least two of its factories.

The Detroit-based supplier had argued it could no longer afford the wage and benefit packages paid by major automakers in competition with other suppliers, including Dana Holding Corp., that have come through bankruptcy with sharply lower labor costs.

For its part, GM offered $200 million to fund buyouts and one-time payouts to remaining workers in exchange for lower hourly wages.

The automaker has been struggling with plunging demand for trucks and sport utility vehicles and the strike gave GM a chance to run down overstocked inventory for slower-selling models including its Chevrolet Silverado pickup.

But GM, which books revenue when it produces vehicles, also said that the strike had cost it $800 million in the first quarter and 230,000 units of lost production as of April.

GM had also shut or partly idled over 30 facilities and put thousands of its own hourly workers on lay-off due to parts shortages caused by the strike.

A LONG, BITTER STRIKE

At 80 days through Friday, the American Axle strike ran longer than major recent actions by the UAW, including a 59-day strike against two GM plants in 1998 and a 67-day strike against GM in 1970 that won a 13-percent pay raise.

From the start, the tone of the American Axle dispute was also more bitter than contract talks with the major automakers last year when the UAW agreed to slash costs by bringing in new hires at lower wages and shifting retiree health care costs to a union-aligned trust.

The UAW accused American Axle of unfair labor practices by failing to share financial information and of overpaying executives, including Dauch.

American Axle posted a net profit of $37 million on $3.2 billion in sales in 2007. The company gave Dauch a 9-percent raise in 2007, taking his total compensation to $10.2 million.

The UAW's Gettelfinger blasted that as "excessive," saying Dauch had collected over $257 million in pay over a decade.

Gettelfinger, who joined the bargaining in recent weeks, also said the company should be renamed, "Axle -- Mexico and elsewhere" after the supplier threatened to ship production to Mexico unless its U.S. workers made deep concessions.

For its part, the company had said the union was out of touch with economic reality by insisting that it offer full medical insurance and supplemental unemployment pay. The supplier said the union had also failed to recognize how badly the decline in U.S. light truck sales had undermined its business during the strike.

At more than $70 per hour, American Axle had also said its overall labor costs ran three times higher than its rivals.

It promised to invest up to $200 million in remaining U.S. plants if the union agreed to a cost-cutting wage agreement.

Wall Street analysts have expected the company to get most of its demands, a view that has supported its stock price in the face of slumping U.S. auto sales. Shares in American Axle are up 21 percent since the start of the year.

(subscription only, which I pay for so I've posted the article)
http://www.autonews.com/apps/pbcs.dll/article?AID=/20080517/ANA02/581734587/1128


Let's see if the members got screwed after the meeting on Sunday.

[Earth Bound Misfit]

1. That's Good News, it seemed like there was

no end in sight. However, given the recent trend (HUGE concessions), it's more than likely not IF the members got screwed, but HOW BADLY. Hope I'm wrong though.

[Earth Bound Misfit]

2. UAW, American Axle reach deal that could end strike

Source: Yahoo! News

http://news.yahoo.com/s/ap/20080517/ap_on_bi_ge/american_axle_labor;_ylt=AnaEnv9HtixkI5nksFv8Ch5v24cA

American Axle and Manufacturing Holdings Inc. boosted its wage offer and increased the payments it will give workers to take a wage cut as part of a tentative agreement that could settle an 11-week strike by the United Auto Workers union, a person briefed on the deal said Saturday.

American Axle had been offering a pay cut from $28 to $17 per hour for production workers, with a $90,000 wage "buy down" over three years to help workers make the transition to lower pay.

The person, who asked not to be identified because the deal has not yet been presented to workers, said the agreement reached Friday includes pay of $18.50 per hour and increases the size of the buy down.

The deal is similar to what the UAW agreed to with auto parts maker Delphi Corp. last year, the person said. In that deal, Delphi agreed to pay workers "buy downs" of $105,000 over three years.

Non-core workers, which are those that aren't involved in actual manufacturing, would be paid $14.55 per hour, the person said, while skilled trades workers would get $26 per hour.

--snip--

Skilled trades worker Doug Sherrill, of Macomb County's Macomb Township, said Saturday that union workers are skeptical.

"We're happy we got a tentative agreement, but is it going to pass? The way people feel around here is it's going to be a tough sell," Sherrill said.

--snip--

Two GM factories that make the company's hottest-selling products went on strike during the American Axle walkout, and industry analysts have said the strikes were an effort to draw GM into the American Axle dispute. Union officials have denied that the strikes were related, and said they were over local contract disputes at the factories in Delta Township near Lansing and Kansas City, Kan.