Detroit – United Auto Workers president Ron Gettelfinger spent much of Wednesday fielding questions from rank-and-file Chrysler workers and union leaders about DaimlerChrysler AG’s decision to sell Chrysler to a private equity firm, and the union’s surprise support of the deal.
“What has changed is that the sale is no longer speculation, it’s a reality,” Gettelfinger said during an online chat with UAW members. “In time, we hope you will come to feel the same way.”
Gettelfinger hosted the Internet dialogue with General Holiefield, the UAW’s chief Chrysler negotiator.
The pair took questions on topics that ranged from pensions and health care to buyout packages and the possibility of future job cuts as a result of the sale to New York-based Cerberus Capital Management LP.
Gettelfinger said current retiree pensions are secure and that buyout packages offered as part of Chrysler’s turnaround would be honored.
“The pension fund for Chrysler workers is, in fact, $2 billion overfunded for financial accounting purposes, and pension benefits are secure,” Gettelfinger said. “Additionally, Cerberus has committed to contributing an additional $200 million to the pension fund and Daimler is providing a conditional guarantee of $1 billion for up to five years.”
He also reiterated that there would be no additional job losses as a result of the sale and posted a letter from Cerberus outlining that commitment.
“You should know that there are no plans – other than those previously announced – to reduce head count,” the letter said. “Excluding abnormal market conditions and productivity, there are no additional job cuts in connection with the transaction announced.”
UAW members were caught off guard Monday when Gettelfinger backed DaimlerChrysler’s agreement to sell its U.S. arm to Cerberus for $7.4 billion because Gettelfinger had vocally opposed such a deal, describing private investment as a “strip and flip” business that is just looking for a quick return.
Gettelfinger said he chose to support it after Chrysler executives assured him that the automaker would not be dismantled, but would prosper.
With news of the sale just days old, the UAW is making every attempt to communicate with members.
Hours before the Internet chat, Gettelfinger and Holiefield joined Cerberus chief executive Steve Feinberg and Chrysler chief executive Tom LaSorda at the UAW-DaimlerChrysler National Training Center in Detroit where some 100 UAW officials from Michigan and other states were reassured of the automaker’s future.
Feinberg, who also met with top labor officials and senior Chrysler manager this week, told the local union officials that Chrysler would stay intact.
Feinberg said Cerberus’ $7.4 billion purchase is a long-term investment.
