As UAW contract deadline nears, GM sends letter to plants

General Motors Co. sent a letter to its plants Friday, telling workers the company was moving the contract bargaining process along with the United Auto Workers as quickly as it can, while stressing it needed to "close the competitive gap" to stay successful.

The UAW is negotiating first with GM, which was chosen as the target company in negotiations after several years of strong profits and a move to close four U.S. plants. Labor contracts expire at 11:59 p.m. Sept. 14. 

"...Our goal is to reach an agreement that builds a stronger future for our employees and the company. We are working hard to understand and respond to UAW proposals and we have offered to meet as often as needed," read the letter signed by Phil Kienle, GM's vice president for U.S. manufacturing.

"What does stronger future mean?" the letter continued. "As our profit-sharing history shows, we want to share our success with our employees. At the same time, we need to close the competitive gap for our success, now and in the future. Creative problem solving will lead to the right balance."

The communication from GM followed letters from two UAW vice presidents on Thursday telling union local leaders for GM and Ford Motor Co. that negotiations are progressing — while stressing the union is prepared to strike if necessary. 

Talks between GM and the union "are progressing slowly," UAW Vice President Terry Dittes, director of the UAW's GM department, said in his letter.

"We remain committed to reaching an agreement that will provide our membership with a fair share of the enormous profits earned by the company," Dittes wrote. He specifically mentioned improved wages, benefits, pensions, profit sharing and cost-of-living adjustments. 

UAW Vice President Rory Gamble, head of the union's Ford department, wrote that subcommittees have reached tentative agreements, but "larger economic issues remain."

Both said strikes are on the table after the current contract expires.

"A strike is difficult and always the last resort when negotiations break down," Gamble wrote. "We are not at that point, but we are prepared if a strike is required." He also said it's not uncommon for the company and the UAW to extend existing contracts.

The letters were sent to GM and Ford local union presidents, shop chairpersons, vice presidents, financial secretaries and recording secretaries.

A UAW-GM National Council Meeting is scheduled Sept. 15 in Detroit, the day after contracts expire.

"We will not know the agenda until hours before the meeting," Dittes wrote. "It may be to vote on a tentative agreement, or the company's current offer on the table, or other necessary actions."

Gamble said the UAW-Ford bargaining committee stands ready as UAW and GM bargainers negotiate the "lead" contract that typically shapes the "pattern" agreements with the remaining automakers. He urged members to be cautious of rumors.

"Many entities against us are attempting to skew perception," Gamble wrote. "It is imperative that we are not misguided about these negotiations by rumors, misinformation or outside influences. We cannot run at the first sign of trouble, nor jump to conclusions at every speculation."

U.S. carmakers see a compensation gap between them and foreign producers like Toyota and Honda with plants in the United States. With benefits and bonuses included, GM hourly employees make $63 an hour, Ford workers make $61 and Fiat Chrysler Automobile workers make $55, according to data from the Center for Automotive Research. Foreign producers spend about $50 an hour for workers in U.S. plants.

From 2014 to 2018, GM's labor costs per vehicle increased 14%, Ford's was up 8% and Fiat Chrysler's was up 42%, according to CAR. 

khall@detroitnews.com

Twitter: @bykaleahall