UAW, American Axle reach deal that could end strike

5/17/2008

DETROIT - American Axle and Manufacturing Holdings Inc. boosted its wage offer and increased the payments it will give workers to take a wage cut as part of a tentative agreement that could settle an 11-week strike by the United Auto Workers union, a person briefed on the deal said Saturday.

American Axle had been offering a pay cut from $28 to $17 per hour for production workers, with a $90,000 wage "buy down" over three years to help workers make the transition to lower pay.

The person, who asked not to be identified because the deal has not yet been presented to workers, said the agreement reached Friday includes pay of $18.50 per hour and increases the size of the buy down.

The deal is similar to what the UAW agreed to with auto parts maker Delphi Corp. last year, the person said. In that deal, Delphi agreed to pay workers "buy downs" of $105,000 over three years.

Noncore workers, which are those that aren't involved in actual manufacturing, would be paid $14.55 per hour, the person said, while skilled trades workers would get $26 per hour.

American Axle confirmed Friday night that both sides had agreed on a deal, but details weren't released. UAW President Ron Gettelfinger said in a statement Friday night that the American Axle bargaining committee voted to recommend the agreement to members, who would get details starting Sunday.

The agreement, which still must be voted on by about 3,600 workers at five plants in New York and Michigan, includes the closure of American Axle's Detroit and Tonawanda, N.Y., forge operations. It also has a separate but lower pay scale for American Axle's operations in Three Rivers, Mich., the person said.

The deal could end a bitter strike that has dragged on since Feb. 26, crippling production at about 30 General Motors Corp. assembly plants in the U.S., Canada and Mexico, and causing thousands of layoffs at other parts supply companies.

Strike captain Duane Thompson said ratification will depend on whether workers believe they can get a better offer. He thinks a better deal than what's been reported can be negotiated.

"There's a bunch of us who don't like it because we feel we deserve more, or just leave what we have alone. But don't take away from us," said Thompson, a Hamtramck resident.

Thompson also said he worries about the impact this contract could have on future contracts for all UAW workers.

"If we pass it, it will make people look funny at us: 'Did you do everything in your power to win, or did you just give up the fight?'" Thompson said.

Skilled trades worker Doug Sherrill, of Macomb County's Macomb Township, said Saturday that union workers are skeptical.

"We're happy we got a tentative agreement, but is it going to pass? The way people feel around here is it's going to be a tough sell," Sherrill said.

UAW workers were picketing Saturday, and plan to continue until an agreement is ratified, but they are feeling the pinch of living on strike pay for nearly 12 weeks, non-production worker Leo McGucki said.

"There's a lot of people hurting," McGucki said, a Warren resident who has worked for American Axle for nearly 13 years.

Still, Thompson said the workers know what's at stake.

"This is our livelihood we're talking about. We can't take that lightly," he said.

It took an offer of a $200 million infusion from GM earlier this month to increase the offer to help reach the agreement.

UAW Local 235 President Adrian King would not comment on specifics. He said the deal was hard-fought and the best the union could do under the current economic circumstances and amid company threats to move work to other countries.

"We did all we could to keep the work here," King said Saturday. "I do feel that this is the very best that the UAW could have achieved with this company."

King said he is sure American Axle would have no qualms about moving work elsewhere.

"It's not a pretty agreement," he said, adding that it has no guarantees against layoffs if the economy continues to worsen.

He also said he was grateful for help from the UAW's GM department.

Two GM factories that make the company's hottest-selling products went on strike during the American Axle walkout, and industry analysts have said the strikes were an effort to draw GM into the American Axle dispute. Union officials have denied that the strikes were related, and said they were over local contract disputes at the factories in Delta Township near Lansing and Kansas City, Kan.

Detroit-based American Axle makes axles, drive shafts and stabilizer bars mainly for large GM sport utility vehicles and pickup trucks. GM accounts for 80 percent of business at American Axle, which was formed from parts plants sold by GM in 1994.

King said Detroit union members will get details of the contract on Sunday and would work out the times for voting at that meeting. He said work would resume as soon as possible if the contract is approved.

Times and locations of meetings for workers at plants in New York and Three Rivers were still being arranged, the UAW said.

The work stoppage affected more than 30 GM plants and decreased production by 230,000 vehicles through April. GM also said the strike cost the company $800 million in the first quarter.