UAW'S GETTELFINGER STOKED ABOUT MULALLY AT FORD; STIFFS DCX

In a pair of stories on UAW President Ron GettelFinger's speech before the Detroit Economic Club this week, Automotive News reported dramatically different treatments for Ford Motor Company (R) and DaimlerChrysler. www.autonews.com

Gettelfinger is "looking forward" to working with new Ford CEO Alan Mulally. Gettelfinger previously headed the UAW Aerospace Department when he "worked with" Mulally before on labor issues at Boeing.

Automotive News quoted Gettelfinger as saying "I found him to be a very credible individual. I never had an issue with him that we weren't able to sit down and talk our way through."

Skeptics reading between the lines will wonder whether Gettelfinger's purr words mean that the UAW chief expects Mulally to be an easy mark or if they mean that Mulally is such a slick salesman that he charms much of the fight out of labor negotiators.

Obviously, both Gettelfinger and Mulally have produced enough positive results on behalf of their respective sides that their respective career trajectories have remained on upward paths. But FoMoCo's situation is undoubtedly more critical than anything either of these leaders faced during Boeing talks. So perhaps the olive branch is a tacit recognition of FoMoCo's dire straits and their potential adverse impact on UAW membership.

Undoubtedly, Mulally's record in labor negotiations was a signficant attraction for William Clay Ford, Jr. But those who believe that hard-nosed negotiations leading to significant labor concessions are necessary to any real "Way Forward" are likely puzzled at Gettelfinger's apparent endorsement. Perhaps there'd be less angst if Gettelfinger had said "that Mulally . . . he's one smart, tough S.O.B! We're really going to have to work harder to obtain the kind of fair contract our workers need . . . "

Gettelfinger, however, may not see the "Way Forward" quite the same as the Glass House gang. Whistling past the graveyard of "right-sizing" and the 30,000 job cuts already announced, Gettelfinger said FoMoCo's challenge is to regain market share. While this is obviously the way a "labor supplier" would prefer FoMoCo to return to profitability, the reality is that Mulally and the Glass House gang will probably seek profitability at FoMoCo's currently reduced volume.

The bind for the UAW is to find a balance that saves as many dues-paying union jobs as possible and preserves the bulk of existing retiree benefits.

In stark contrast, Gettelfinger wasn't as kind to DCX. Automotive News reports that Gettelfinger said the UAW won't give DCX's Chrysler group concessions on health care costs. Gettelfinger said that the issue won't even be brought to a union vote.

Of course, the UAW previously agreed to some health care cost relief for FoMoCo and General Motors: "[A]ctive UAW workers forgo some future pay increases and face higher co-payments for prescription drugs. UAW retirees [from GM and FoMoCo] with pension incomes of more than $8,000 a year will start paying monthly premiums, deductibles and co-payments for health care" according to the Automotive News report.

It isn't that GM, FoMoCo and Chrysler aren't all at a huge health care and retirement cost disadvantage to the non-unionized Japanese transplant factories, because they are. It's just that Chrysler's financially healthier at the moment than GM and FoMoCo.

The UAW position evidences that its bargaining posture is often divorced from the big picture in the global automobile market. Instead of agreeing to a "pattern" that treats each automaker equally, fairly and competitively within the context of prevailing North American labor costs, so as to improve the Detroit 3's competitiveness and retain as many jobs as possible, the UAW apparently seeks to cherry pick, and grab all they can, while they can. This leads to greater cost distortions and less competitiveness. Moreover, it adversely affects consumer choice in that the high cost producers must cut somewhere else merely to stay in the game.

Perhaps Gettelfinger should just "ask Dr. Z" about it.