Auto workers torn by hope, fear on merger talk

By Nick Carey

WARREN, Michigan (Reuters) - Workers at General Motors Corp and Chrysler LLC expressed a mixture of hope, fear and uncertainty on Tuesday over reports the two U.S. automakers had been in merger talks at a time when both are struggling to conserve cash and protect sales.

"I think it could be a good idea because, hopefully, it will create more jobs for everybody," said Derek Milbrocker, a 21-year-old assembly line worker at GM's engine and transmission plant in the Detroit suburb of Warren, Michigan.

"But I have very low seniority so I'm concerned there'll be job cuts and I'll be one of the first to go."

Other workers at this plant and two nearby Chrysler plants next door -- the three plants line the road about 8 miles from downtown Detroit -- echoed those concerns.

GM and Chrysler produce many competing models, including the Dodge Ram and Chevrolet Silverado trucks, and a merger is seen as leading to certain job cuts, plant shutdowns and the elimination of models and dealerships.

"GM's got a truck just like Chrysler has," said William Wills, a contractor at Chrysler's Warren truck plant, which makes Dodge Ram and Dodge Dakota pickup trucks. "If there's a merger then one of those trucks has got to go. That's what everyone in this plant is concerned about."

Tom Cook, an assembly worker at the same plant, said Chrysler could benefit from GM's global network, but added, "as of now we're in the dark. We have no idea what's going on."

Cerberus approached GM recently about a merger with Chrysler, the No. 3 U.S. automaker. Cerberus has also shopped Chrysler around to other potential bidders without immediate success, sources said over the weekend.

The talks with GM hit a snag over the value of Chrysler and any resolution is still seen as weeks away, according people close to the negotiations.

Union leaders in the United States and Canada said on Tuesday they had not been consulted by the automakers on any merger talks.

For the workers streaming into the three plants for the afternoon shift a unseasonably warm and sunny October day, just what impact such a deal would have on their livelihoods was clearly weighing on their minds.

"These three plants have been here forever and a day," said William Reaume, a forklift driver at the third plant here, a Chrysler stamping plant. "I'd like to see it stay that way."

From where Reaume stood, the towers of GM's downtown Detroit headquarters were visible in the glaring fall sunshine.

Philip Woods, a contractor who works for both GM and Chrysler, said he feared a merger would reduce competition between the two companies and the other U.S. automaker Ford Motor Co.

"It's been the Big Three forever and if you reduce that to the Big Two, I don't think they are going to be as competitive," Woods said. "That means prices will go up."