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September 27, 2007
General Motors and the UAW bet their futures on a dramatic new labor agreement Wednesday that could ensure the survival of both -- making GM more competitive against its foreign rivals and helping the union stanch the loss of members, according to the Detroit Free Press.
More broadly, the proposed labor contract has the potential to shape a new Detroit auto industry that can compete on a more-level playing field with Toyota Motor Corp. and other foreign rivals not burdened by huge retiree legacy costs built up over the 20th Century. Also, the agreement has the potential to recast the UAW -- often dismissed as an industrial relic -- and give it more clout in the national health care debate.
The landmark feature of the UAW's tentative deal with GM is a controversial retiree health care trust that would shift tens of billions of dollars of retiree medical, hospital and prescription costs to the UAW and off GM's books.
The agreement, which ended the first national strike against GM in 37 years, will serve as the template for new agreements at Chrysler LLC and Ford Motor Co.
Posted by Peter C. T. Elsworth 
at 9:32 AM to Auto industry
, GM
, Unions
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