* Most nonunion auto plants in U.S. Southeast
* U.S. automakers want to narrow pay gap
* UAW-U.S. automaker labor talks begin last week in July
By Bernie Woodall
DETROIT, July 13 The time for the United Auto
Workers to win the hearts and minds of nonunion workers in
southeastern U.S. plants is now in one top union executive's
"If not now, when? We are going to fix it or we continue to
do what we're doing. You keep kicking the can down the road or
we're going to fix it," said Gary Casteel, director of the UAW
region that includes Tennessee, South Carolina, Alabama and
Georgia where most of the nonunion auto plants are located.
Casteel echoes the belief of his boss, UAW President Bob
King, who has staked his reputation and the union's future
growth on winning votes to represent workers at those plants. A
failure would likely result in a marginalized organization.
The importance of attracting workers at nonunion plants
will be underscored when the UAW opens negotiations for new
four-year labor agreements with U.S. automakers General Motors
Co (GM.N), Ford Motor Co (F.N) and Chrysler Group LLC later
"The UAW will exist whatever happens with this organizing
campaign, but it is pivotal for the kind of bargaining power in
the industry and the kind of broader national presence that the
UAW would like to have," said Harley Shaiken, a labor professor
at the University of California-Berkeley.
"Simply put, if (the UAW) is bargaining for the three
Detroit automakers, that is an increasingly a smaller share of
the pie in the U.S., even if that stabilizes or grows," he
Shaiken called the UAW's effort to organize workers in the
South "unprecedented" because it also involved talking with
company executives to convince them that the UAW can make for
The UAW has its latest target in sight as employee
representatives for Volkswagen AG (VOWG_p.DE) are in talks with
the U.S. union over organizing workers at the German
automaker's new plant in Chattanooga, Tennessee, Casteel told
Reuters on Wednesday.
Establishing a foothold in one of the foreign automakers'
U.S. plants would be a huge victory for a union that has seen
its membership fall 42 percent since 2004 to about 377,000 at
the end of last year. And the drop is even larger from its
all-time high in 1979 of nearly 1.5 million members.
King has been clear that the union's future depends on
signing up workers in these plants.
"If we don't organize the transnationals, I don't think
there is a long-term future for the UAW," he said earlier this
However, the union faces many challenges, starting with
convincing workers in the largely anti-union South, Casteel
Many workers the UAW representatives speak with feel
threatened by their bosses about talking with the union, he
said. That's a big reason why King has pushed -- unsuccessfully
so far -- for companies to allow the UAW to freely speak with
its workers at their factories rather than the more laborious
task of going door-to-door.
Casteel also said it is difficult to convince workers who
are just happy to have jobs that in many cases are in areas
where the local economy is weak.
Rod Parker, a 42-year-old worker at the VW plant in
Tennessee fits that description. He said he likes his job at VW
because of the "growth opportunity at a time of a lot of
shrinkage" and wouldn't join the UAW if asked.
THE UAW GHOST
The UAW in the past has repeatedly failed to organize
workers at the U.S plants of such automaker as Japan's Toyota
Motor Corp (7203.T), Honda Motor Co (7267.T), and Nissan Motor
Co (7201.T), South Korea's Hyundai Motor Co (005380.KS) and Kia
Motors (000270.KS) and Germany's VW, BMW (BMWG.DE) and Daimler
AG's (DAIGn.DE) Mercedes-Benz.
However, the UAW remains a presence in the South, as
companies must pay higher wages than they might to fend of the
union, said Kristin Dziczek, labor and industry director at the
Center for Automotive Research in Ann Arbor, Michigan.
"When you look at wages that are paid in the auto industry,
the internationals, some of them pay as much, in one case at
least, more than UAW wages," she said.
"I don't know that they do that solely out of the goodness
of their hearts or if they do that to head off any kind of
organizing attempt," Dziczek added. "If they weren't afraid of
being organized, they would pay whatever they wanted."
One argument the UAW must drive home to their nonunion
peers is that it is in their long-term interest to join the
union because a weaker UAW will have less ability to influence
higher wages and benefits, Shaiken said.
"If the UAW disappeared tomorrow, your wages are going to
go down," he said.
The UAW already has seen that influence wane as newer
entrants VW and Hyundai Motor Co have the two lowest labor
costs in the U.S. industry.
The restructuring of retiree health-care costs in 2007 when
formal negotiations between the UAW and the big U.S. automakers
was held led to a narrowing in the difference in the total
compensation received by workers at the so-called "Detroit 3"
U.S. automakers and the nonunion companies.
For instance, GM's total compensation rate for its workers
is now about $57 per hour, while Ford's is $58 and Chrysler's
$49, according to Sean McAlinden, chief economist at the Center
for Automotive Research. That compares with $51 to $52 for
Toyota, $50 to $51 for Honda, $45 to $48 at Nissan, $44 at
Hyundai and an estimated $50 for both BMW and Mercedes-Benz,
Volkswagen, which officially opened its Tennessee plant in
May, pays about $30, McAlinden said.
VW officials point out that base salary for their Tennessee
plant workers will increase over the next three years by steps
to $19.50 per hour from $14.50 now.
While that nearly matches the entry level wage for U.S.
automakers, each of them have veteran production workers making
twice that hourly wage. Chrysler's all-in compensation rates
are less because among the Detroit 3, it has the highest number
of new workers making the "second-tier" wage rate.
Ford and GM labor negotiators will press in the upcoming
talks to narrow the gap further.
The UAW hopes to change the conversation by organizing the
VW may be a better fit for the UAW as the German automaker
is used to dealing with union workers in Germany, where almost
all of its workers are represented by IG Metall.
Often during speeches, King cites the "German example" --
including having board representation -- as a way forward for
union's less adversarial relations with the three U.S.
(Additional reporting by Deepa Seetharaman and Ben Klayman;
Editing by Lisa Shumaker)