UAW reconsiders relief for Chrysler

Detroit News staff and wire - - United Auto Workers President Ron Gettelfinger said Monday the union is reconsidering whether it should give health-care concessions to the Chrysler Group.

The union in September told Chrysler it wouldn't give the company similar health concessions to those agreed to last year with General Motors Corp. and Ford Motor Co. because Chrysler's parent company, DaimlerChrysler AG, was in better financial shape.

In light of Chrysler's $1.5 billion third-quarter loss and its expected annual loss of $1.2 billion, Gettelfinger said the union was taking another look at the automaker's financial position. Prior to the problems late this year, Chrysler had posted 12 straight profitable quarters.

"Let's just say that we're taking a look at the books of Chrysler and we'll see what comes of that," Gettelfinger told Paul W. Smith in an interview on WJR-760.

While pointing out that union had decided earlier not to give Chrysler health-care relief, he said.

"We are going to take a look at it again based on the financial circumstances."

As it did with Ford and GM, the UAW is conducting an independent financial study of Chrysler.

"We are looking at Chrysler books through our experts. It's a little bit of a different situation there with them being a German-based company.

"It seems it's a little harder to pull together information. We are taking a look."

Gettelfinger made it clear that no decision has been made.

"We are looking long-range. We are trying to be responsible, but we are not going to be pushed in any one direction. We've not ruled it in and we have not ruled it out.

Chrysler expects to spend $2.3 billion this year on health care. Company executives have sharply criticized the UAW's decision to deny Chrysler health care relief.

"This is the first time Gettelfinger has made clear he is looking at our financials," said Chrysler spokesman Mike Aberlich.

"We certainly feel that's a step in the right direction and we are helping him understand everything about our particular situation."

A deal with the UAW similar to the Ford and GM arrangements would save Chrysler hundreds of millions of dollars over time. Any deal would have to be ratified by Chrysler's workers.

At GM and Ford, active workers agreed to direct a portion of future wage increases to a health-care fund. Retirees pay as much as $752 a year per family for medial coverage; they had no out-of-pocket expenses before.

GM won health concessions with 61 percent of union members' votes.Before the vote, the UAW hired financial adviser Lazard Ltd. and law firm Cleary Gottlieb Steen & Hamilton LLP to review the automaker's finances.

Ford's union workers approved the givebacks with a narrower 51 percent majority.

The UAW also used Lazard and other advisers to study Ford's books.

Chrysler has already cut health-care benefits for white collar workers and retires.

Chrysler is also preparing a restructuring to be announced early next year.

Bloomberg News contributed to this report.