Image: Tim Levandusky
Joshua Gunter  /  AP File
UAW Local 1250 president Tim Levandusky will borrow a page from the steelworkers' playbook, collaborating with Ford and other American manufacturers to cuts costs, improve the bottom line and save as many jobs as they can.
updated 9/22/2006 5:35:05 PM ET 2006-09-22T21:35:05

Shuttered plants. Thousands of good-paying jobs lost. Retiree benefits at risk. Global competition. An uncertain future.

Those words describe the situation now confronting 75,000 Ford Motor Co. employees, faced with plant closings and buyouts as the company moves forward with its plan to cut 30,000 jobs and get business back on track. And this week, DaimlerChrysler AG announced it will cut retail shipments by 16 percent to reduce a backlog in dealers’ lots, which means some plants will see temporary shutdowns between now and the end of the year.

They’re words they United Auto Workers union has heard before from a brethren industry — the one that produces the steel for the cars they build.

So, armed with the benefit of hindsight, the UAW has vowed to borrow a page from the steelworkers’ play book, collaborating with Ford and other American manufacturers to cuts costs, improve the bottom line and save as many jobs as they can.

Tens of thousands of U.S. steelworkers had tough choices to make two decades ago, when their industry began to decline. Many chose wrong, and dozens of company bankruptcies followed. Ultimately, a healthier industry emerged, but one that employed only a fraction of the workers it once did.

Displaced autoworkers have a shot at a happier ending: Their layoffs come at a time when the booming coal, rail and natural gas industries are aggressively recruiting replacements for retirees.

Experts and some union officials say the UAW’s new strategy — flexibility rather than defiance — is more than a necessity in the new world economy: It’s also a sign of waning power as labor struggles to find its voice in the age of globalization.

“Unionization is down, and the legal climate faced by unions in terms of organizing and bargaining is very unfavorable for them,” said James Piazza, an assistant professor of political science at the University of North Carolina at Charlotte. “They have no choice but to compromise and hope the company stays afloat.”

In steel, change wasn’t easy.

'My heart goes out to the autoworkers'
Many workers were forced to leave the mills and find new careers. Those who managed to keep a job faced lower pay, new work rules, smaller staffs and the burden of knowing 80,000 retirees lost health care and pension benefits during the industry’s rebirth.

“My heart goes out the autoworkers because I know they have been a very productive and tough union for a number of years. And I know what they’re going to go through as they adapt to the changes necessary to keep the remaining jobs in their industry,” said Dave Gossett, spokesman for the Independent Steelworkers Union.

The union weathered the loss of hundreds of jobs when Weirton Steel Corp. went bankrupt and again when it was revived by Cleveland-based International Steel Group. Two years ago, Netherlands-based Mittal Steel Co. bought out ISG.

Like the United Steelworkers of America did with factories in Cleveland and elsewhere, the ISU worked closely with its new management to cut costs.

They accepted new work rules that gave employees multiple duties, not just one. Their new contract created profit-sharing incentives, but also gave the company the flexibility to idle and restart blast furnaces to adjust to demand.

To save jobs in the auto industry, that style needs to be borrowed, said Tim Levandusky, president of the UAW Local 1250, which represents 3,800 workers at three Ford engine and casting plants.

A new contract approved in April may encourage Ford to keep those factories open, he said.

Workers agreed to help find ways to lower costs and gave up their insistence that Ford replace retiring workers. The union also is working with politicians on possible tax breaks and incentives for Ford.

'We all have a lot to lose'
“We all have a lot to lose in this. We understand the importance of working together,” Levandusky said.

Ford spokeswoman Marcey Evans said the union and Ford have worked together to negotiate new health care benefits, the buyouts and competitive operating agreements that have made the plants more efficient.

“Ford has historically had — and continues to have — a strong, positive relationship with the union,” she said.

Agreeing to buyouts was tough and watching colleagues lose their jobs even tougher, Levandusky said. But it had to be done, or Ford won’t be able to match its plants with its market share.

“It’s the right thing to do and it’s a positive in that regard,” he said.

Meanwhile, industries with a current or looming shortage of workers are using the auto industry slump to their advantage.

Wyoming officials have had job fairs in Michigan to fill positions that pay $20 an hour or more in the booming coal, oil and natural gas industries.

Union Pacific Railroad is aggressively hiring, too, worried that 40 percent of its 50,000 workers will be eligible for retirement within the next decade.

Spokesman James Barnes said autoworkers’ skills may translate well to the railroad, which needs engineers, mechanics, technology experts, managers and transportation workers in California, Nebraska, Texas, Oregon and Wyoming.

Second-career opportunities
“It is unfortunate that the automotive industry is experiencing layoffs,” he said. “But for people interested in a second-career opportunity, we do have openings.”

And plenty of people may be interested.

Ford plans to close 16 plants in the next two years, including a factory in Maumee near Toledo, Ohio, where 680 people earn $25 to $30 an hour making bumpers and other parts.

By the end of 2008, Ford also plans to sell or shutter all facilities it took back as part of a bailout of Visteon Corp., a supplier spun off from the automaker.

Mary Beth Deily, an associate economics professor at Lehigh University, said even workers who opt for early retirement packages have incentive to see their former employers improve financially. Until they are eligible for Medicare, they’ll likely depend on that buyout deal for much of their health care coverage.

The steelworkers, she said, are an instructive tale for autoworkers.

“They’ve learned from what they’ve seen go before them,” she said. “Just because you’re a big firm is not any guarantee that the firm is not going to go bankrupt.”

© 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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