Contract talks between the United Auto Workers union and DaimlerChrysler AG continued past a midnight deadline Tuesday amid reports of unauthorized work stoppages, so-called "wildcat strikes," at five of the company's plants in Missouri and Indiana.
Both UAW and company officials advised covered employees to continue working under an "indefinite extension" of the current three-year contract until a new agreement is reached. But there was no immediate indication that the workers in Missouri and Indiana would heed that call.
The work actions were the first signs of tension in what had been unusually civil negotiations aimed at replacing a UAW contract covering nearly 75,000 hourly and salaried workers at DaimlerChrysler and 300,000 UAW-represented workers at General Motors Corp. and Ford Motor Co.
The sporadic walkouts began about three hours before the contract deadline, and affected two of the company's minivan plants near St. Louis, as well as two transmission facilities and a casting plant in Kokomo, Ind.
The Indiana plants make transmissions for nearly all DaimlerChrysler vehicles built in the United States.
Neither the UAW nor company officials offered an explanation for the walkouts. Federal labor law forbids work stoppages over national contract issues while such a contract is in force.
There was some speculation here among DaimlerChrysler officials that the stoppages were over local matters. Some suggested the job actions were saber-rattling maneuvers meant to signal rank-and-file discontent with a contract extension.
Such maneuvers seemed unnecessary earlier in the evening, when both sides indicated that they were making progress toward an agreement that would increase UAW hourly wages by 3 percent to 4 percent annually and provide increased job security.
German-owned DaimlerChrysler, whose U.S. offices are located in this Detroit suburb, has been the de facto target, or lead company, in the talks, which means the UAW hopes to use an agreement with that company to pattern settlements with GM and Ford.
The U.S. auto industry is prospering in part because of popularity of highly profitable sport-utility vehicles and other light trucks, which now account for nearly 48 percent of all new-vehicle sales in America. And those sales are zooming along at a historically high seasonally adjusted pace of 16.7 million vehicles annually.
That means, if sales and leases of new vehicles hold steady through the end of calendar 1999, the industry could post an all-time high of 16.7 million to 17 million cars and trucks, eclipsing the 1986 record of 16.03 million vehicles, according to analysts' reports.
So much money is rolling into the coffers of Detroit-based and Detroit-related car companies they have combined cash reserves of $50 billion, according to analysts.
Therefore, the analysts say, an expected annual raise of 3 percent to 4 percent for auto workers, plus production bonuses and cost-of-living increases, is not so difficult for automakers to accept.
A bigger problem for automakers is how long the good times can continue.
"When you look at where those earnings of U.S. automakers are coming from, you see them flowing from a very narrow stream--light trucks," Healey said. "They aren't making much money on passenger cars, and they aren't making much money overseas. What happens if sales of light trucks dry up?"
That is a question UAW and auto industry negotiators have been discussing in current talks, especially as it relates to the matter of "job guarantees."
According to sources familiar with the talks at DaimlerChrysler, the UAW has been seeking "lifetime job guarantees" for workers with three years on the job. DaimlerChrysler supposedly has countered with an offer of guaranteed employment for workers with 10 years employment.
But in any case, those sources said, job guarantees would be conditioned on sales volume, much as they were in the UAW-industry agreement signed three years ago.