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Buckle Up: The UAW Contract Talks Are Going to Be a Bear

Auto executives may be in no mood to make concessions considering the auto market’s shrinking sales.

Yesterday marked the start of negotiation talks between the United Autoworkers Union – or UAW – and the Big 3 automakers – GM, Ford and Fiat Chrysler … and according to industry experts, we shouldn’t expect this to be easy.

Not that you did.

According to Bloomberg auto executives may be in no mood to make concessions considering the auto market’s shrinking sales at a time when every major company is investing big bucks in the development of both electrics and autonomous vehicles.

And if that didn’t make things awkward enough, the UAW is said to be already riled after GM’s series of plant closures this year.

So, what will the major sticking points be? Bloomberg predicts one will be healthcare. According to the report, UAW workers contribute just 3 percent annually to their health care costs – compared with 29 percent for the average worker with an employer-sponsored plan. That gives them some of the best healthcare benefits in the nation, but they’re weighing heavily on automakers like Ford, who says this line item will cost them more than a billion dollars next year.

The other big contentious issues will likely be job security, especially after this year’s bloodbath at GM left union workers in the lurch, as well the automakers’ use of temporary workers – a strategy that offers the car companies cost savings and flexibility, but helps promote what UAW President Gary Jones calls “a race to the bottom” – one he says the union will halt with this year’s talks.

But the last point that could cause these four-year contract talks to hit some serious snags has to do with the bribery scandal that plagued both the UAW and Fiat-Chrysler with indictments over the past few years. Neither party was considered a victim, but there was certainly damage done with Fiat Chrysler funneling millions of dollars to UAW execs in order to keep them “fat, dumb and happy.” Many believe that the scheme had tangible impact on the last round of negotiations in 2015. And while the union blamed its role on a few bad apples, this year’s contract talks could be a bit more hard fought to prove that their intentions are only to bargain on behalf of the workers.

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