Changing Gears is a public media project about the future of the industrial Midwest. Each week, reporters Dan Bobkoff in Cleveland, Niala Boodhoo in Chicago and Kate Davidson in Ann Arbor cover issues of interest to the Great Lakes region. Changing Gears also sponsors public events and conversations.
Contracts covering United Auto Workers members at the Detroit auto companies expire tonight and the pace is stepping up.
Sergio Marchionne, the Fiat chief executive who also oversees Chrysler, flew back to the United States from Germany, skipping a meeting with Chancellor Angela Merkel, according to the Detroit News.
UAW President Bob King says he’s confident a deal can be reached by the deadline, although it’s not unusual for talks to go on longer.
There can’t be strikes at General Motors and Chrysler, due to agreements reached when the companies received federal bailouts. And while the UAW could walk out at Ford, the cordial relationship there makes a strike highly unlikely.
So, what are the big issues at stake in these talks? I talked to WBEZ’s Venture program this week about the negotiations.
Three stories making news across the Midwest today:
1. Goodbye Cleveland, hello Chicago. A Cleveland-area steelmaker could receive more than $1 million in financial incentives to move its headquarters to downtown Chicago, Crain’s Chicago Business reported this morning. JMC Steel Group Inc. could bring 50 new employees in the move. Chicago’s Community Development Commission will hear a proposal to provide $1.1 million in incentives Tuesday. Crain’s writes the approval would “represent another victory for Mayor Rahm Emanuel,” who has touted several job victories since taking office.
2. Ford faces UAW strike. A Wednesday deadline looms on contract talks between United Auto Workers officials and Detroit automakers, although representatives on both sides say the discussions could be extended. UAW president Bob King tells our partner station Michigan Radio that a strike is not a “goal” of the talks, but others believe a strike could happen at Ford. Gary Walkowicz, a bargaining committeeman, says union members deserve to receive cost-of-living adjustments surrendered during the recession.
3. Obama will speak in Ohio. President Obama will continue the campaign for his $447 billion jobs bill in Columbus, Ohio, today. He’ll emphasize part of his proposal that marks $25 billion for school building and renovation while speaking at Fort Hayes Arts and Academic High School. It’s part of Obama’s plan to fight for the American Jobs Act on the turf of his Republican counterparts. The Ohio visit, in House Speaker John Boehner’s home state, comes four days after Obama visited House Majority Leader Eric Cantor’s district in Richmond, Va.
Bailouts and bankruptcies behind them, Detroit’s automakers are now facing talks on new national contracts. The United Auto Workers kicked off the ceremonial opening of negotiations at Chrysler today, and will do the same at Ford and General Motors later this week.
UAW President Bob King says he doesn’t want to put any of the companies at a disadvantage.
“We want them to be competing on the basis of product, design and quality,” he said, according to Bloomberg.
Contracts expire in September. During the last major negotiations, in 2007, the auto industry was on the verge of a devastating decline in sales that would lead to federally sponsored restructurings at Chrysler and G.M., part of an industry bailout that cost $82 billion.
This time, the Detroit automakers are each profitable again. G.M., Ford and Chrysler combined to earn more than $6 billion in the first quarter. Last year, GM earned $6.17 billion. Ford had net income of $6.56 billion in 2010, the most in 11 years. (Chrysler, now part of Fiat, did not report 2010 results.)