Hot! Uaw Workers Should Envy Social Security Raise

GM's interior debate: Does Chevy need a further crossover?

GM's Reuss reads place for range in U.S. pickup truck market

Scion's iQ surprise: I fit, it's quick

DETROIT When the us government announced today that Social Security recipients are certain to get your 3.6 percent cost-of-living adjustment future year, I was reminded once more with exactly what great deals the Detroit three or more wrested from the UAW on this year's deal negotiations.

Those recipients would improved with the Social Security Administration as compared with that 113,000 UAW users at the Detroit three did inside automotive talks.

See, hourly employees failed to get their particular cost-of-living change restored, neither did they will acquire a new wage increase.

Instead, your UAW negotiated lump-sum installments in the a number of decades that amount to be able to a good twelve-monthly maximize involving with regards to 3.2 p'cent at Chrysler Group, 3.8 percent with General Motors and 5.5 p'cent with Ford Motor Co.

In some other words, if inflation makes its pace, Chrysler's 23,000 hourly individuals will have got a smaller amount making electric power within a number of ages as compared with they've got today. The similar is most likely genuine intended for GM's 49,000 trades-people for the reason that inflation molecules and erodes profits about time. Only Ford's 41,000 personnel will turn out slightly ahead.

Remember, too, people workers never have have a salary increase because 2003, and in addition they created complete concessions of $7,000 to $30,000 per technician covering the past four years. They couldn't claw back people concessions during this year's negotiations.

Worker pain, though, continues to be the carmakers' gain.

Each belonging to the Detroit 3 can expect it is overall hourly crews expenditures to boost one particular percent as well as a smaller amount every year within the contracts. If the actual automakers acquire a net revenue and the must be easy granted make have yearly U.S. auto profits with 10.5 million in order to bust even they're going to share only a little little bit having the trades-people from the form of revenue sharing.

It's exciting which Wall Street is last but not least identifying just how special this labour deals unquestionably are for that Detroit 3.

On an Oct. 18 seminar call, Morgan Stanley analyst Adam Jonas put that in perspective: "What's transpired underneath some of our noses here is that they have closed into an hourly wage contract that should not simply remain competitive together with the Japanese nonetheless will probably be materially lower. We consider they bought incredibly great deals."

You can certainly achieve David Barkholz with dbarkholz@crain.com .

COMMENTS