UAW chief says buyouts slow, rules out new round
 

Automotive News | April 3, 2008 - 12:01 am EST

DETROIT (Reuters) — The number of workers represented by the UAW opting to take buyouts and early retirement has fallen sharply and negotiating an additional round of such offers would be "futile," the union’s president said on Wednesday.

The three Detroit automakers — General Motors, Ford Motor Co. and Chrysler LLC — have all offered buyouts and early retirement packages to tens of thousands of workers represented by the UAW as part of an effort to return their loss-making North American operations to profitability.

But UAW President Ron Gettelfinger said the weaker U.S. economy and a slumping housing market had made workers less eager to accept payouts to leave their jobs.

"The economy has slowed buyout momentum. Right now, people think ‘Why do I want to take risks?," Gettelfinger told Reuters after a speech to a business group.

"If you look at the buyout rates we got in 2006 and 2007, I don’t think we’ll see it again," he said.

Ford has concluded a round of buyouts, but not yet announced how many UAW workers accepted offers that included paid tuition and one-time cash buyouts of up to $140,000.

Ford has not said how many workers it was targeting to reduce, although union workers have said the company wanted to cut 8,000 jobs but was likely to fall short.

Chrysler aimed to cut up to 10,000 jobs through buyout offers it made on a plant-by-plant basis. Last month, UAW Vice- President General Holiefield said the privately held automaker controlled by Cerberus Capital Management was likely to fall short of that number.

GM has offered buyouts and early retirement packages to all of its roughly 77,000 UAW-represented workers. Gettelfinger had earlier estimated that less than 20,000 GM workers would accept such deals.

About 46,000 GM workers are already eligible for retirement. At Ford, about 12,000 workers are retirement eligible, with at least 30 years of seniority.

Some 68,000 UAW workers took buyouts at GM and Ford that were offered in 2006.

When asked about the prospect the U.S. automakers could offer a third major round of buyouts with better terms, Gettelfinger rejected the possibility.

"I think it would be an exercise in futility at this point," he said.

The U.S. auto industry is under mounting pressures from tighter credit, a collapse in housing prices and record gasoline prices, which have rocked consumer confidence.

The Detroit-based automakers, whose lineups rely more heavily on trucks and sport utility vehicles, have also been hit hard by the shift toward cheaper and more fuel-efficient small cars.

GM, Chrysler and Ford negotiated a four-year contract with the UAW in 2007 that allows them to hire replacement workers at a starting wage of just $14 per hour, roughly half the current average, as they cut costs in a bid to return their U.S. operations back to profitability.

UAW President Ron Gettelfinger