Delphi woes flag end of era

Union workers feel loss of power in restructuring as parts supplier enters bankruptcy

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October 13, 2005|By STEPHEN FRANKLIN | STEPHEN FRANKLIN,CHICAGO TRIBUNE

DAYTON, Ohio -- All the wild talk and rumors threw Scott Seibert into a dark mood. People were fretting about losing their jobs, their homes and their savings.

Seibert couldn't wait to leave early from the Delphi Corp. factory where he has worked for the last 29 years and 10 months.

"I find it hard to work right now with a knife sticking in my back," he said, over a drink at a workers' hangout near the plant.

From Seibert and many others here, the bankruptcy filing by Delphi, the nation's largest auto parts maker, represents the end of an era for a 95-year-old company that took its name from this once-thriving industrial city.

Delphi - previously Delco, as in Dayton Electronics Laboratory Co. - formed here by a group who called themselves the "Barn Gang." In 1910, they started cranking out inventions in this town of inventors. The first automobile electric starter system was built here. The cash register was perfected here. And the Wright Brothers built their plane here.

Now Dayton takes on a new significance beyond being yet another setting for the Midwest's fading blue-collar dreams. It could become one of the battlegrounds in the slow dismantling of the traditional, unionized auto industry.

The idea is that the Big 3 automakers are hopelessly overmatched by the Japanese and other competitors, and must completely gut their cost structures to keep afloat.

Delphi, spun off by GM and still its biggest parts supplier, is about to go through that wrenching change - with workers here seeing their paychecks slashed. Once restructured, Delphi could be a model for GM, Ford and German-owned Chrysler.

But the question is how hard will the unions fight back. If they cooperate, companies like Delphi and GM might find renewal. If they don't, GM, too, could eventually find itself in bankruptcy court, where the rules would allow wholesale changes in spite of union objections.

Delphi wants the United Auto Workers to accept wage cuts to $10 to $12 an hour - as much as 63 percent less than they're making now - and benefit reductions as well. If its unions do not accept the changes, the company says it might shut plants and lay off workers.

The number of Delphi workers in the Dayton area has shrunk to about 5,400, from 15,000 in 1999, when Delphi was spun off from General Motors Inc. Other manufacturers also have shrunk or vanished.

UAW members average $25 to $29 an hour at Delphi; the union only recently was forced to accept a second tier of wages that start at $14 an hour.

But the International Union of Electricians-Communications Workers of America, which represents about 8,500 Delphi workers in the United States, and the United Steel Workers union, which has about 1,000 Delphi members here, have not done as well.

Over the years, those unions have accepted two-tiered wage scales starting as low as $7 an hour. They've also taken wage freezes and given up traditional pensions in order to keep their members working.

"We've been telling the company for years that they should have been bringing work here. But they didn't take advantage of it," said Dennis Bingham, president of United Steelworkers Local 87, which once had 8,500 workers in Dayton.

After years of bargaining to save jobs or create new ones, Bingham, who started out with the parts maker here 44 years ago, finds himself in a new and unsettling situation.

With a bankruptcy judge deciding the company's fate, "you feel like you don't have control. You feel like your future is in somebody else's hands," he said.

Stephen Franklin writes for the Chicago Tribune.

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