GM has made the extraordinary offer of lifetime employment to workers with at least 10 years seniority VIDEO CNN's Ed Garsten reports this year talks appear to be going more smoothly than ever Windows Media 28K 80K

September 12, 1999
Web posted at: 6:23 p.m. EDT (2223 GMT)

From Detroit Bureau Chief Ed Garsten

DETROIT (CNN) -- The United Auto Workers Union and the nation's three largest automakers are coming down to the wire on negotiations to reach new contracts and avoid the possibility of a strike.

The contracts between the UAW and Ford, General Motors and Daimler-Chrysler end at one minute before midnight Tuesday. The union is negotiating separately with each company.

The talks come as the U.S. auto industry is headed for a record year, on target to sell almost 17 million cars and trucks.

The 407,000 men and women who build those vehicles, already making about $21 an hour, are hoping the new contracts will give them an even bigger piece of the companies' increased earnings.

"We think we should. We're the backbone. We do the work," says Joe Walker of UAW Local 7.

Job security is another issue important to the UAW. Automakers are anxious to cut costs by cutting their payrolls and by using outside, non-union sources for many components -- a practice called outsourcing.

During the latest talks, General Motors made the extraordinary offer of lifetime employment to workers with at least 10 years seniority.

"It's a very important statement of commitment and a very important psychological step, saying, 'You're a part of the team. If you sign up with the company, you're tenured,'" says David Cole of the University of Michigan's Office of Transportation Studies.

The offer also marked an important turnaround in relations between GM and the UAW, which became frosty following strikes last year at two plants in Flint, Michigan. Analysts say neither side won the strike, and GM lost $2 billion in sales.

Relations between the UAW and Ford have been generally warm, but they have cooled recently while the company considers spinning off its Visteon parts division.

This is the first time the UAW will negotiate with Daimler-Chrysler, formed by the merger of the No. 3 U.S. automaker with Germany's giant Daimler firm. Word from the talks is that they are going extremely well.

But perhaps the greatest number of people affected by these talks aren't even working or will soon be ready to punch out for the last time.

Within the next three years, the number of retired UAW members is expected to be greater than the number still on the assembly lines. That fact has made the issue of increased pension benefits more important than in the past.

"I think we'll see some enhancements of pensions," Cole says.

There is also little doubt being expressed on either side that agreements will be reached. After all, they say, who wants a strike when everybody is making money?