'It all depends on my financial situation, whether he goes to the college he wants to go to.

If this Fiat thing can save our company, I'll have some extra income. If I don't, I don't know if I'll be able to help him.'

UAW Local 685 member
Brian Hicks of Kokomo, Ind.,
left, with son Clayton

I don't know what the future holds," said Essie Scruggs, a UAW Local 276 member, sharing the anxiety experienced by tens of thousands of General Motors workers as the company heads into court for an unpredictable, government-sponsored ride through bankruptcy. "I would like for the plant to be open for the new people that are coming; we've got to have some decent jobs in this country."

Hoping for a better future, Scruggs supported the modified settlement agreement ratified by a 74 percent majority of GM workers in both skilled trades and production bargaining units.

"We went through it very thoroughly before we voted" at a May 27 meeting at the local union hall, said Scruggs, a team leader in the department that inspects Chevrolet, GMC and Cadillac vehicles for fit and finish before they leave the Arlington, Texas, facility's assembly line. "We discussed all the modifications. Nobody votes for something that they don't know what they are voting for."

Tough choices:

With all the details on the table, many parts of the contract weren't easy to accept. "We did have bonuses that I felt we were entitled to that we are not going to receive," said Scruggs, who is tired of hearing know-nothing legislators in Washington attack UAW-negotiated compensation.

"I bet you not a one of them could do what I do; they've got a cushy job. Anybody who wants to bash somebody, they should first find out what they do. You've got to get to a car every second; it's not easy," she said.

Scruggs is also concerned about increased costs and reduced benefits for retirees, including Medicare payments of $76.20 a month for retirees and the elimination of dental and vision benefits. But the alternative to a concessionary agreement was too dangerous to contemplate: The liquidation of GM, the closure of every single one of its facilities, the loss of hundreds of thousands of jobs – and the elimination of company pensions, which would have left many UAW GM retirees with drastically reduced benefits.

Billions in government

backing: With a UAW-ratified agreement in place, and last-minute deal with a majority of GM bondholders in advance of a June 1 deadline, the Obama administration agreed to provide $30 billion in financing for an expedited bankruptcy proceeding. The goal is to help GM restructure as a smaller, more competitive automaker.

The UAW will have a seat on the creditor's committee, which plays a key role in reviewing company operations during bankruptcy, to protect the interests of active and retired union members.

The newly reorganized company plans to pay pensions to UAW retirees and surviving spouses without any interruption, and with no reduction in benefits.

Fast track for Chrysler-Fiat alliance:

Chrysler's new alliance with Fiat, which will also protect retiree pensions, took effect June 10, just six weeks after the company filed for bankruptcy. It's the fastest corporate reorganization in history for a large-scale industrial firm.

"It's unbelievably quick," said Brian Hicks, a UAW Local 685 member who works in the heat treat department at Chrysler's Kokomo (Ind.) Transmission plant. "I would have bet it would not have happened that quick."

Public funding, said Hicks, is needed to give Chrysler a chance to rebound. "Without that government money," he said, "we wouldn't be having this conversation. Chrysler wouldn't exist, and I'd be out there looking for a job, trying to get by on my unemployment benefits."

Chrysler idled the Kokomo facility a week before entering bankruptcy; the plant reopened in June. During the summer the temperature inside his department – which is not air conditioned – can reach up to 125 degrees. But Hicks is happy to be back in the heat.

"I've been in heat treat for 14 years," said the father of two. "The vacation was nice, yeah, but I'm ready to get back in the workforce and be a little more productive."

High stakes, high costs: The price of preventing two of America's largest manufacturers from going out of business will be steep for workers and communities. On top of the concessionary agreement, GM announced the closure or idling of 17 facilities; Chrysler will close eight plants.

The new GM is seeking to reduce its 60,000-strong UAW workforce by up to 20,000. Chrysler will also reduce positions due to plant closures, but the impact will be reduced when Fiat brings small car production and key engine technology into Chrysler facilities.

At the end of restructuring, Chrysler expects to have a UAW workforce of 26,000 or more, down from some 32,000 at the beginning of 2009.

"It's been a long road for our active and retired membership," said UAW President Ron Gettelfinger at a May 29 news conference announcing the ratification of the GM agreement.

Union bargaining teams were in nearly continuous negotiations for months, working on modifications to UAW labor agreements and changes to the Voluntary Employee Beneficiary Association (VEBA) – an independent trust for retiree health care – that will save Chrysler and GM billions of dollars.

"This was difficult for everyone involved," said Getteflinger, "and not just for our membership but for all stakeholders. We are satisfied we have done the right thing here to give us a lifeline until this company can rebound."

"But there is no excuse for these companies not to build in this country. And we're going to remind them of that every day," he added.

Fighting for U.S. jobs:

Before sealing a deal with GM, UAW negotiators, backed by a grassroots campaign, fought to change GM's turnaround plan in order to reduce imports and increase production based here in the United States.

GM submitted a restructuring plan to the U.S. Treasury Department on April 29, its third effort to meet requirements for continued government financial support. The plan called for the company to increase imports from Mexico, Korea, Japan and China by more than 365,000 units a year, with a corresponding drop in U.S. production.

In May UAW members turned up the heat.

"It was our members getting in touch with their elected folks and putting pressure on the White House, the auto task force and the company," said UAW Vice President Cal Rapson, who directs the union's GM Department. "Because of that, we were able to change the emphasis on imports, and keep more jobs and more plants in this country."

The modified UAW GM labor agreement includes a commitment by the company to source small car production of up to 160,000 units a year in an idled UAW GM facility, along with related stamping operations.

President Obama recognized the job-saving features of the UAW GM agreement when he announced a new package of government assistance June 1.

"GM will start building a larger share of its cars here at home," he said, "including fuel-efficient cars. In fact, if all goes according to plan, the share of GM cars sold in the United States that are made here will actually grow, for the first time in three decades."

The UAW's modified labor agreement with Chrysler, ratified in April, also includes major sacrifices and a commitment to small car production in the United States.

"Everyone contributed so we can be viable for the future – active, retired and nonbargaining unit," said UAW Vice President General Holiefield, who directs the union's Chrysler Department.

"We have an agreement from Fiat for new product built in the U.S," he said. "It's going to be the smaller more fuel-efficient vehicles. And we still have a chance to sit down and hold discussions with Fiat and Chrysler to see if there is more opportunity as the market recovers."

10 million cars a year – or more?

The GM and Chrysler restructuring plans are based on projected annual U.S. sales of 10 million cars and light trucks per year. That's the current estimate for 2009, the lowest figure in decades due to the global economic recession and the loss of jobs and income throughout the U.S. economy. By contrast, total sales were over 16 million in 2007 and over 13 million in 2008.

The future of America's car companies, say UAW autoworkers, depends on a successful economic recovery that will get Americans back to work – and back into dealer showrooms.

"It all depends on sales," said Scruggs of Local 276. "That's what determines whether a plant is going to be open. That's what you're there for."

Hicks of Local 685 is hoping that company restructuring – and a recovery in the U.S. auto market – will translate into a more secure future for his 17-year-old son, who is preparing applications for college.

"It all depends on my financial situation, whether he goes to the college he wants to go to," Hicks said. "If this Fiat thing can save our company, I'll have some extra income. If I don't, I don't know if I'll be able to help him."

Roger Kerson