Somebody has a short memory
 | Keith Crain is editor-in-chief of Automotive News. |
| Sponsored by |
| » | ||
| » | ||
| » | ||
| » | ||
| » |
Reprints
Print
Respond
So the union is unhappy and wants to strike General Motors, Ford and Chrysler.
This time it's the Canadian Auto Workers waving the battle sword and getting ready to strike Detroit 3 plants in Canada. Are memories so short?
I am not about to put all the blame for the near-collapse of the North American auto industry on the unions, either the CAW or the UAW. But have CAW leaders forgotten that the health care trusts for the UAW own big chunks of Chrysler and GM?
Yes, it's probably a great big conflict of interest when a union is bargaining against another union's interests. It would be a fascinating dilemma when workers are striking other workers' retirement benefits.
Let's not forget that just four years ago the Detroit auto companies were on the brink of collapse. Anyone who thinks that they are all financially sound these days is naive.
It doesn't make sense for the unions to push them back into the same uncompetitive rut.
The simple and fairest solution would be for the unions to bargain for a share of the profits. A lot of companies have profit sharing. In the last UAW contract, instead of locking in fixed costs through wage increases, the automakers gave bonuses and promised profit sharing, and the UAW agreed. That certainly would make sense for the CAW.
Chrysler and GM went bankrupt for a bunch of reasons, among them that their labor costs were not competitive.
If the CAW has its way, it won't take long before the three auto companies in North America would be back in the same rut and the same dangerous cycles. That should be avoided at all costs.
If the car companies are making money, a share of the profits makes sense for the union workers, as it does for all employees. And if things go badly, the union shouldn't want to have created a structure that put the companies at financial risk.
Even to consider a strike today is ridiculous. Do CAW members really want to strike the interests of UAW members and retirees?
The UAW's health care trusts became shareholders as the government's way to take a big liability off the books of the bankrupt Chrysler and GM.
At the same time, the government didn't seem to mind creating large losses for bondholders, shareholders, many employees who lost a big portion of their retirement benefits -- and hundreds of dealers who were summarily canceled.
I'm not sure the feds should brag about the job they did in structuring the bailouts.
You can reach Keith Crain at kcrain@crain.com.
