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[Search] Progress in Chrysler strike
Deal reached on Mound Road outsourcing
May 7, 1997
BY ALAN L. ADLER Free Press Automotive Writer
Chrysler and international UAW negotiators reached a compromise Tuesday on the key issue in the 27-day-old Mound Road engine plant strike -- the transfer of work to a mostly nonunion outside supplier.
Details of the compromise were not revealed. And reaching a settlement now depends on selling it to local union leaders and resolving plant-level gripes over health, safety and production standards that covered what by all accounts was a national showdown over outsourcing.
If a settlement is reached, most of about 20,000 workers laid off at five Jeep and truck plants and a host of parts plants should be called back to work quickly.
The breakthrough on the key issue -- outsourcing the production of driveshafts to mostly nonunion Dana Corp. -- came in a phone call between Chrysler labor relations chief Tom Gallagher and UAW Vice President Jack Laskowski.
Dennis Pawley, Chrysler's executive vice president of manufacturing, cut short a meeting in Gaylord and returned to Detroit on Monday, apparently because a breakthrough was close. Bargainers for Chrysler and UAW Local 51 met for the first time Tuesday evening since the strike began April 10.
Outsourcing is not an issue over which a UAW local can strike, but neither the union nor Chrysler made any secret that it was the key to the company's longest strike in 30 years.
That the strike has lasted so long surprised many industry observers. But Chrysler executives dug in, saying their right to run the business was being challenged.
Chrysler yielded to the UAW when it struck Detroit's McGraw glass plant in November 1995. The automaker had wanted to sell the plant and buy its glass from independent suppliers. But to end the walkout, it agreed to keep McGraw and modernize the plant.
Outsourcing -- the practice of sending work done by UAW members to an independent, often nonunion, supplier -- was a focus of last fall's national contract talks between the UAW and the Big Three.
The UAW did not win new language on outsourcing, but got a guarantee that Chrysler, Ford Motor Co. and General Motors Corp. would keep at least 95 percent of current workforces for the next three years. There are exceptions for such things as a recession that cuts sales and parts plants that are losing money.
A Mound Road settlement likely will include an announcement of $100 million in new work being assigned to the plant, and Chrysler will be allowed to move the driveshaft work to Dana, which is based in Toledo.
Chrysler has said it does not consider the transfer of work as outsourcing because no jobs are being lost. The 250 workers who make the driveshafts would be moved to other jobs in the Mound Road plant.
Local negotiators still must settle all other disputes in order to reach a new contract for the plant that will end the strike.
The lack of engines from Mound Road forced Chrysler to close the Jefferson North assembly plant, where the highly profitable Jeep Grand Cherokee sport-utility vehicle is made; the Dodge City truck plant in Warren, which makes Dodge Ram and Dakota pickups; the Pillette Road van plant in Windsor; the St. Louis North truck plant; and the Conner Avenue plant, which makes the Dodge Viper roadster.
Parts and components plants in Michigan, Indiana and Wisconsin also have idled workers who made parts for Mound Road.
Chrysler is challenging unemployment benefits for workers laid off because of the strike. Wisconsin officials said last week Chrysler must pay the benefits. Michigan and Ohio officials have not decided. More than 8,700 jobless claims are pending in Michigan.
A settlement at Chrysler is expected to almost immediately turn up the heat at GM, where about 9,400 UAW members are striking assembly plants in Oklahoma City and Pontiac as well as parts of GM's Truck Product Center and a Lear Corp. seating plant in Rochester Hills.
Negotiators are making minor progress in both strikes. The central issue -- the union wants GM to permanently replace workers who retire, not eliminate their jobs or fill them with temporary workers -- has yet to be addressed at the highest levels.
When its Chrysler workers are back on the job, the UAW is expected authorize another local GM strike, probably at one of five key parts plants that have yet to reach terms on a local contract.
Of the five, the car transmission plant in Warren is expected to be the first to get international UAW authorization. A strike there would quickly affect numerous assembly plants and could delay introduction of the Oldsmobile Intrigue.
The strike in Oklahoma City has stopped production of the Oldsmobile Cutlass, the first new moderately priced model at Oldsmobile in six years. A dearth of new products stunted Oldsmobile's progress in remaking itself from a division favored by older shoppers to an alternative for 40-something import buyers.
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