Feb 19, 2007
DaimlerChrysler Corporation (DCX) announced on February 14, with great fanfare, the latest “restructuring plan” for its Chrysler Group. The company alleged huge business losses and threats from competition so severe that DCX might have to sell off the Chrysler Group to the highest bidder – unless, of course, workers give back large concessions in the coming contract negotiations and agree to leave quietly.
DCX is copying, in a more obviously staged way, the past maneuvers of GM and Ford against their workers. First, hide the company’s true financial condition. Second, fill the media with dire prophecies of gloom about the company’s future. Third, announce plant closings and layoffs “expected” some time in the future. Fourth, offer to workers “buyouts” packaged to look like their best available option. Fifth, after the buyouts have been taken – return to business as usual, but with a cheaper work force.
GM has gone the full cycle. Ford is near the end of its “buyout” phase. And Chrysler is tagging along, having just announced one plant closing, maybe, 2 years from now, and the layoff of one production shift at each of two truck plants, maybe, this coming June.
It’s nothing but a sophisticated psychological warfare to persuade workers to give up even more of the few advantages that were won in past struggles.
Auto has always been a cyclical industry. Plants run flat out for a few years, then production falls off for a year or two, then the plants rev up again. While the company booms, workers get little extra compensation. When the company slumps, workers are supposed to take the hits.
It’s precisely against these cycles that workers in the past won such protections as seniority order for layoff and recall, supplemental pay during layoffs, and job banks. The auto companies could easily fund these programs from their super-profits made during good years. They won’t do it, if they can take the money away from the workers instead.
In fact, 2007 was still a great year! DaimlerChrysler’s net operating profit for 2006 was 7.3 BILLION dollars. DCX will pay its usual $1.88 per share dividend to the holders of its billion-plus shares. But U.S. media have so far ignored this fact. As they have ignored the profits of DCX’s Financial Services Division, which reported record profits for the fifth year in a row – profits on financing some 6.7 million vehicles, about 70% of them sold in the U.S.
The media report only the alleged “problems” of Chrysler Group. Workers are not told the true situation.
DCX, as GM and Ford before it, attempts to frighten workers by floating rumors of selling off the company. Sold or not sold, what’s the difference? Chrysler was sold to Daimler-Benz in l998. Chrysler bought Jeep before that. In 1980-82 the workers gave up huge concessions without the company being sold at all.
What matters is not who owns a company. What matters is how much workers decide to put up with – or not put up with.
The Chrysler workers have already, without being sold, given up deep concessions at local levels, pushed on them by their union leadership. Workers’ break times were reduced. Contractors operate “independent” parts of the Toledo Jeep plant. The Belvidere plant runs a new shift with “enhanced temporary” workers who have no chance to gain regular jobs. The Michigan GEMA engine plant in Dundee opened just like a non-union shop, without respecting the usual work classifications, without allowing laid-off Chrysler engine workers the right to transfer in.
On the other hand, Chrysler workers have not yet been saddled with the dollar-an-hour wage cut and the new retiree health-care premiums rammed through at GM and Ford. After the resistance to the cuts at Ford, the union leadership decided not to risk rejection by Chrysler workers. The fight by Ford workers against the concessions was enough to set back the corporate plans – at least for the moment.
The moment may pass – or it may be extended and enlarged on. Everything depends on how well auto workers can see through and resist the companies’ games of psychological terrorism. And also resist their own union leadership’s corporate cooperation.