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AAM/UAW Negotiations Update
April 22, 2008
UAW PROPOSALS STILL NOT MARKET COMPETITIVE;
PLANTS MAY CLOSE
The strike called by the International UAW at AAM’s original U.S. locations continues into its 57th day. Approximately 3,650 associates are represented by the UAW at these five facilities in Michigan and New York.
AAM and the UAW worked effectively last week with the objective of reaching a new collective bargaining agreement for the original U.S. locations. Tentative agreements were achieved on many issues and AAM was encouraged by the progress.
On Saturday, April 19, 2008, the UAW bargaining team left the table and did not return until the afternoon of Monday, April 21, 2008.
Although AAM has made several economic proposals to the UAW with “all-in” hourly wage and benefit packages that were considerably higher than the market rate of AAM’s UAW-represented competitors in the U.S., the UAW has repeatedly rejected these economic proposals.
AAM needs a U.S. market competitive labor agreement for the original U.S. locations. This is necessary because the UAW previously negotiated market competitive labor agreements with many of AAM’s U.S. competitors in the driveline market segment. This includes Dana, FormTech, Chinese-owned Neapco and Indian-owned Bharat Forge. The “all-in” wage and benefit package granted by the UAW to these companies averages approximately $30 per hour.
In order for AAM to be able to compete for new business and sustain employment at the original U.S. locations, the UAW must offer AAM economic terms and conditions that are comparable to those it has already granted to AAM’s competitors. The UAW’s latest economic proposal to AAM dated April 14, 2008 included an “all-in” wage and benefit package that is almost double the market rate established by the UAW with AAM’s competitors.
If the International UAW is not willing to consider a U.S. market competitive labor agreement for AAM, a Michigan-based company, similar to the agreements it has given to companies based in China and India, AAM will be forced to plan for the potential closure of some, or all, of these uncompetitive facilities.
“AAM has been, and continues to be, totally committed to ensuring that all of AAM’s manufacturing operations are viable, profitable and sustainable,” said Co-Founder, Chairman and CEO Richard E. Dauch. “AAM’s negotiating team has never left the bargaining table and will continue to work in good faith to achieve a market-competitive labor agreement that will allow the original U.S. locations to compete on a level playing field in the U.S.A.”
