United Auto Workers union President Ron Gettelfinger wants to keep Chrysler with Daimler, and he plans to take his case to the German company’s supervisory board.
Gettelfinger, speaking to reporters at a Wednesday news conference to announce Chrysler’s plans to invest $1.78 billion in Michigan plants, said there are advantages to keeping the companies together.
“I personally think that there’s a lot of value in keeping it there right now because of the synergies, even though you don’t hear a lot about that,” Gettelfinger said. “There’s been some times when the Chrysler Group has buoyed up the DaimlerChrysler in and of itself and then we’re in a little downturn right now.”
Gettelfinger, who serves as an employee representative on DaimlerChrysler AG’s supervisory board, said he would like to make his pitch the next time the board meets.
“That’ll be coming up in the very near future,” he said.
Gettelfinger has been against DamilerChrysler selling its U.S. operations to private equity investors whom he says will “strip and flip” the company by selling it off in parts.
Chrysler has been on the auction block since the parent company announced on Feb. 14 that all options are open for the struggling unit. On the same day, the company announced a restructuring plan that included offering buyout and early retirement packages to 13,000 workers.
No clear front-runner has yet emerged to buy Chrysler. But Canadian auto parts supplier Magna International Inc. reportedly has submitted a bid to buy Chrysler for between $4.6 billion and $4.7 billion.
Major private equity firms Blackstone Group and Cerberus Capital Management LLP also are believed to be in the hunt after both perused Chrysler’s books during a February visit to its Auburn Hills, Mich., headquarters.
General Motors Corp. also is said to be interested.
Chrysler Group lost $1.48 billion in 2006 and said it expects losses to continue through 2007. DaimlerChrysler, however, earned $4.26 billion in 2006.
Gettelfinger said Chrysler’s losses and problems are small compared to past losses at Ford Motor Co. and General Motors Corp.
“It’s like hardly anything,” he said. “It appears to me we’re moving forward and we just don’t need the aggravation of going through whatever happens here. It seems to me like both the Chrysler Group and DaimlerChrysler as a whole would be better served if we focused on moving forward with the plan that’s in place and building a quality product and worrying about the future.”
Gettelfinger said he has a lot of support on the supervisory board, and he confirmed that the UAW has had frequent talks with Chrysler suitors.
He stopped short of saying that the union is developing strike plans against Delphi Corp.
The UAW is holding meetings with Delphi locals around the country to update members on talks between Delphi, the former parts-making operation of General Motors Corp., and private equity investors who have pledged to pump up to $3.4 billion into the struggling company.
Last month the union rejected a wage offer from Delphi that it called insulting. Gettelfinger said at the time that the UAW has done probably too much for the company. The union has approved mass buyout and early retirement offers and has allowed a two-tier wage scale that pays new hires less than veteran workers.
Delphi has said that talks are continuing.
“We’re taking the next step in the process, and I don’t want to get into exactly what that is,” Gettelfinger said Wednesday. “We’re moving forward internally because this thing has gone on long enough.”
Troy-based Delphi, which GM spun off as a separate company in 1999, has been operating under bankruptcy protection since October 2005. It hopes to emerge from Chapter 11 this year.
The company has said it can’t compete with its high labor costs. It has asked a federal bankruptcy court in New York for permission to void previous labor contracts, but it has said it prefers a negotiated settlement to court action.
Last month Gettelfinger threatened to strike if Delphi tries to void the contracts.
A settlement between Delphi and its unions is needed before three private equity firms will invest the money that Delphi needs to emerge from bankruptcy protection.
The firms, Appaloosa Management LP, Cerberus and Harbinger Capital Partners Master Fund I, can back out of the deal if no agreement is reached with the unions on wages, benefits and other issues.
The Wall Street Journal reported Monday that Cerberus is concerned about the company’s long-term profitability and has asked the UAW to slow down pay raises for new hires in the future.