UAW Authorizes Strike Against Delphi

In this March 22, 2006, file photo, Delphi's World Headquarters is shown in Troy, Mich. United Auto Workers members have voted to authorize a strike against auto parts supplier Delphi Corp., adding a new threat to already tense negotiations between the two sides and Delphi's former parent and largest customer General Motors Corp. (AP Photo/Carlos Osorio, File) (Carlos Osorio - AP)

Jay Waks, who heads the employment law practice at the New York law firm Kaye Scholer, said the strike authorization vote is a commonly used tactic and could help break any impasse in the talks.

"There are very difficult issues on the table, costly to both sides," Waks said.

Mark Sweazy, president of UAW Local 969 in Columbus, Ohio, said the strike vote sends the message that the union means business. His local, which represents about 700 hourly workers, approved the measure by a 96 percent margin.

"We don't look forward to a strike, but if a strike should become necessary to prove a point or at least to get the two parties to communicate and make amends of the situation, we are all in favor of that," Sweazy said.

A Delphi strike could harm Toyota Motor Corp., DaimlerChrysler AG's Chrysler Group and other automakers that depend on Delphi parts. But it could paralyze GM, which remains Delphi's largest customer. Analysts have said GM could lose up to $130 million a day during a strike.

GM Chairman and Chief Executive Rick Wagoner said in an interview last week that GM has stockpiled some parts but hopes to avoid a strike.

"We do have some banks of parts, but we're speaking a matter of days, not months, so it's not a question of avoiding the issue for any significant period of time," Wagoner said.

Todd Jordan, a UAW-represented Delphi hourly worker and union activist from Kokomo, Ind., said he's concerned there hasn't been enough preparation for a strike on the union side. Workers should have been slowing down production so companies couldn't stockpile parts and prolong the strike, he said. Jordan also said he believes the UAW should have asked GM workers to join Delphi workers on the picket line since their contracts were negotiated together.

"There's more to a strike than just walking out," Jordan said. "Membership are ready to fight for their livelihoods. I just hope that the leadership has the experience and wisdom to prepare them."

At least one of Delphi's customers has asked the court to block a strike. In a filing last week, International Truck and Engine Corp., which buys around $46 million in parts from Delphi each year, said Drain should bar the company's unions from striking because of the negative impact it would have on the entire industry. Drain hasn't ruled on that request.

Several Wall Street analysts have said the risk of a strike is relatively low because GM has the cash to prevent one. In a note to investors last week, KeyBanc Capital Markets analyst Brett Hoselton said he believes Delphi, GM and the UAW will reach an agreement as early as June that will avoid a strike. Hoselton said he expects GM will agree to supplement workers' wages with the money it will save by ending its contracts with Delphi and buying cheaper parts from other suppliers.

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Associated Press Writer James Hannah in Dayton, Ohio, contributed to this report.

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On the Net:

Delphi Corp.: http://www.delphi.com

General Motors Corp.: http://www.gm.com

United Auto Workers: http://www.uaw.org