© 2024 MICHIGAN PUBLIC
91.7 Ann Arbor/Detroit 104.1 Grand Rapids 91.3 Port Huron 89.7 Lansing 91.1 Flint
Play Live Radio
Next Up:
0:00
0:00
0:00 0:00
Available On Air Stations

Somber kickoff of Fiat Chrysler-UAW contract negotiations

Fiat Chrysler

Is there trouble in store for Fiat Chrysler come September?

Some analysts believe so, saying the automaker faces the greatest risk of a strike by fed up Tier 2 workers at Chrysler.

Tier 2 workers make roughly half the pay of the higher-seniority Tier 1 workers – while doing the same job.

Tier 2 workers also get a lower level of benefits, and they do not get health insurance upon retirement.

Both union leaders and Fiat Chrysler CEO Sergio Marchionne agree that it's unfair.

But Marchionne warned at today's contract negotiation kickoff that any contract that attempts to bridge the wage and benefits gap must be sustainable in bad times, as well as good times.

"We need to be cognizant of what happens when there's a downturn," he said. "The downturns in this industry are lethal enough to kill you. I mean, they'll chop you off at the knees." 

He added, "If we insist on going back to the antagonistic type of bargaining that was once typical of this industry, it will be absolutely disastrous."

UAW President Dennis Williams agreed that the union needs to protect the profitability of Fiat Chrysler. 

But he says the situation with Tier 2 workers is "bleak," saying many live in near-poverty, with no "path to the middle class," as their Tier 1 co-workers have.

Tracy Samilton covers energy and transportation, including the auto industry and the business response to climate change for Michigan Public. She began her career at Michigan Public as an intern, where she was promptly “bitten by the radio bug,” and never recovered.