GM, union reach deal

Action could end month-long strike in Michigan

Staff, wire report
General Motors Corp. and a local union in Michigan reached a new labor agreement Thursday that could end a month-long strike at a Michigan plant which makes some of GM’s hottest selling vehicles.

Meanwhile, the Canadian Auto Workers union tentatively agreed Thursday to labor deals with GM and Chrysler LLC that would replace contracts expiring in September.

The Detroit automaker and UAW Local 602 reached the tentative agreement in the early morning hours, GM spokesman Dan Flores said. UAW Local 602 represents 3,300 workers at the Delta Township plant, which makes GM’s hot-selling Buick Enclave, Saturn Outlook and GMC Acadia crossovers.

Workers at the Lansing-area plant, who have been on strike since April 17, will remain on strike until they ratify the contract. A ratification vote is scheduled for today, according to the Local 602 Web site. A message seeking comment on the contract was left with Local 602 President Doug Rademacher.

GM and the UAW reached a national contract agreement last fall, but local unions negotiate their own work rules and other issues. A UAW local at a plant in Kansas City, Kan., which makes the Chevrolet Malibu sedan remains on strike. That strike began May 5.

One of the two unions — 1,000 member Local 1714 — at GM’s Lordstown Complex has ratified a local agreement with GM, while the larger union — 2,400 member Local 1112 — is said to be close to reaching a tentative pact.

The end of the strike at Delta Township and the canceling of a threatened strike that had been scheduled to start Thursday at a GM stamping plant near Mansfield could signal the national UAW is close to a contract agreement at American Axle and Manufacturing Holdings Inc.

GM is American Axle’s largest customer, and many industry analysts have suggested the local UAW strikes were an effort to draw GM into the negotiations. GM has offered $200 million for buyouts and supplemental pay for workers at American Axle in an effort to bring the 80-day strike to a close. The UAW has denied that the local strikes were related to American Axle.

American Axle spokeswoman Renee Rogers said Thursday that negotiations were progressing.

On Wednesday, GM canceled health care benefits for the striking workers at Delta Township, saying it was not obligated to offer those benefits during a strike. Flores said benefits will be reinstated when workers are back on the job. It was the first time GM has canceled benefits for strikers since a 47-day strike in Flint in 1998.

An official at Local 602 said the UAW was picking up the tab for health benefits. The UAW also is paying workers $200 a week in strike pay.

In Canada, CAW President Buzz Hargrove said the deals keep the automakers labor costs essentially the same as they are now. A deal with Ford Motor Co. last month also kept the company’s labor costs essentially the same, the union said.

Hargrove said the agreements prevent a two-tier wage system used in the U.S. where new hires would be paid about half the hourly wages of older employees. The deals also freeze wages.

The CAW also received a commitment from GM on investments to produce new vehicles at a plant in Oshawa, Ontario, a key demand.

The Chrysler agreement reflected many of the basics already included in the other deals.

Al Iacobelli, a Chrysler vice president, said the company is pleased to have a tentative agreement with its 9,600 CAW employees.

‘‘We believe this agreement recognizes the contributions of our CAW work force, while helping contribute to Chrysler Canada’s overall competitiveness,’’ Iacobelli said in a statement.

GM and Chrysler declined to comment on the details of the agreements until the ratification process is done.

Hargrove said the membership will vote on the new GM deal on Friday and the new Chrysler deal on Saturday.

‘‘This is a good agreement. It protects as many jobs as we could,’’ Hargrove said. ‘‘This truly is a win-win in a difficult time.’’

The current contracts cover about 22,000 GM and Chrysler workers.

The contracts do not include what the automakers got from the United Auto Workers in the U.S. last fall — a lower-tier wage for new hires of around $14 per hour, about half that of a current UAW production worker.

Industry analysts have said Ford settled early to avoid a strike at its Oakville, Ontario, factory, which makes the strong-selling Ford Edge and Lincoln MKX crossover vehicles that are important to Ford’s cash flow.

Ken Lewenza, head of CAW’s Chrysler bargaining team, called negotiations tough late Wednesday.

‘‘We’re not dealing with companies that have a lot of cash here. We’re dealing with companies that are in market decline,’’ Lewenza said.

GM recently announced the closure of a plant in Windsor, Ontario. About 1,400 workers will lose their jobs. GM also recently announced 900 job losses at a plant in Oshawa, Ontario.

Ontario Premier Dalton McGuinty said he is prepared to give automakers more taxpayers’ money for new projects, despite the layoffs.