GO
Loading...

Breaking the UAW and Other Conventional Wisdoms

Wednesday, 10 Oct 2007 | 11:21 AM ET
AP

Over the last two months, I've heard roughly the same thing time and again from people in the auto industry and in Detroit. It's a variation of the general theme, "Chrysler, or more specifically it's owner Cerberus Capital, wants to break the UAW once and for all."

I chuckle at this notion. Why?

Do you really think Cerberus Capital bought Chrysler witha strategy of perhaps forcing the UAW into a long costly strike? Sure, the private equity firm wants Chrysler to have more competitive labor costs. Yes, it wants to put Chrysler in a position where it can grow and be sold or spunoff in the years to come for a healthy profit.

But Chrysler and Cerberus can achieve that without risking a long, nasty strike that ultimately may not break the UAW.

This conventional wisdom is similar to the one you hear in Detroit that goes like this: "Ron Gettlefinger wants a strike simply to show the UAW is tough."

This piece of wisdom discounts that Gettlefinger is a shrewd negotiator who is more likely to use a strike as a tool to get a better deal.

Funny how we're at a crossroads for the auto industry and people want to portray some things as more than they really are.

Questions? Comments? BehindTheWheel@cnbc.com

  Price   Change %Change
DAI
---

Featured

  • Phil LeBeau is a CNBC auto and airline industry reporter based in the Chicago bureau and editor of the Behind the Wheel section on CNBC.com.

Autos