Marchionne has often expressed the view that the two-tier wage structure – ratified in 2007 by the UAW and the Detroit Three – isn’t healthy for workers or the automaker.
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Both Williams and Marchionne also said they would consider it a personal failure if the companies aren’t able to reach an agreement and workers strike.
On that basic point, Marchionne and the UAW see eye to eye.
“I was rebuffed once, and I won’t go back to get my nose bloodied a second time”, Marchionne said on Tuesday, the paper said, speaking on the sidelines of a ceremony to kick off labor contract talks with the United Auto Workers union. At the time, Chrysler, GM and Ford were suffering financially from truck-heavy lineups, overproduction, a reliance on incentives and a labor contract that made their UAW workforce more expensive than competitors. Forty-five per cent of FCA’s USA hourly workers now make the lower wage because the company hired so many people after emerging from bankruptcy protection and joining Italian automaker Fiat SpA in 2009. He fears that some of these workers are not even part of the middle class as expected theoretically.
“Their future seems somewhat bleak because they have no path (to full pay)”, he said.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective.
“But they are no more hard than those we’ve had in the past”, said Williams.
How that would actually work is far from clear, but the fact that FCA is toning down its bravado as NHTSA is getting serious about calling foul on the automaker means that there’s at least some push to rectify matters.
In January, Marchionne suggested that the workers who haven’t had a raise since 2007 also should not get a raise from the next contract. The union wants pay raises for longtime workers, an end to lower pay for entry-level workers and new product guarantees what would generate jobs at USA factories.
Fiat Chrysler benefits from the elimination of a cap in 2011 talks on the percentage of entry-level workers it can hire, giving it an advantage over its crosstown rivals.
Chrysler opens negotiations with the UAW on Wednesday, and Ford is scheduled to follow next week.
Also, workers there have received far smaller profit-sharing checks than workers at Ford or GM because Fiat Chrysler’s profits have been smaller. FCA’s operating margin for its USA operations is 3.3 per cent, compared with 6.7 per cent at Ford and 8.8 per cent at GM. Entry-level workers now make up to $19.28 per hour; longtime workers make $29 per hour.
On Tuesday, Williams didn’t clearly explain how he hopes to deal with those differences.
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“We must be creative and we must be thoughtful”. “Pattern bargaining is very important to us philosophically”.
