updated 6/11/2004 8:39:21 AM ET 2004-06-11T12:39:21

Union workers at Maytag Corp. are staffing pickets and pondering leaner finances after walking off their jobs at the company's central Iowa washer and dryer assembly plants.

Contract talks broke down Thursday, and 1,525 workers commenced a strike hours later. The previous contract expired May 31, but talks had continued.

Pat Teed, United Auto Workers Local 997 president, said negotiators "thought we had a package that the membership could vote on, but there were a couple of issues, as a union, we could not live with." Health care costs are a sticking point in the talks, but Teed declined to discuss the issues until after a meeting Friday with workers.

Maytag CEO Ralph Hake has said recently that costs of production at the Newton plants is too high partially due to the benefit package workers and retirees receive.

In addition to the workers, the contract also affects 700 laid off workers with recall rights, 1,400 retirees and 350 surviving retiree spouses.

Teed said union members have worked hard to help the company cut costs.

"We've been doing a lot of things to help the company take cost out of products," he said. "We're justifying our wages."

Striking workers said they had been preparing for months for the strike. Many families have delayed large purchases, stocked up on groceries and saved as much money as possible.

Chris Johnson, a quality control process specialist, said the union had arranged strike-preparation classes a couple of months ago, telling workers how to stretch their household budgets and which bills to pay first.

Greg Christy said many workers, anxious from the drawn out negotiations, expressed relief about the strike.

"We have a direction. We know where we're going now," he said.

Hake said earlier that the company had stockpiled appliances to guard against a strike and that three other laundry plants could boost production.

The last big strike in Newton was in 1971, when workers were out for five months. Workers staged a one-day strike in 1974, essentially waiting a day to ratify a contract, he said.

Hake earlier had praised a contract reached with Hoover workers in North Canton, Ohio, as "a model for preservation of jobs."

In that agreement, reached in December, about 1,500 workers represented by the International Brotherhood of Electrical Workers accepted changes in work rules and a new health plan that requires employee contributions.

Copyright 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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