WASHINGTON — WASHINGTON - First it was the heads of Detroit's Big Three automakers who offered public pledges to cut costs, shrink their vehicle lines, go green and slash their salaries in the quest for a desperately needed government bailout.
Yesterday, it was the workers' turn to sacrifice before crucial congressional hearings begin this morning on the automakers' request for $34 billion in emergency loans.
United Auto Workers President Ron Gettelfinger said the union would allow General Motors, Ford and Chrysler to delay billions of dollars in payments to a retiree health-care trust and suspend a jobs bank that pays laid-off workers. The union also would consider other cost-cutting changes, he said.
But Gettelfinger complained that after workers agreed to major concessions in 2005 and 2007, the union and the companies were being asked to make significant new sacrifices in order to secure federal aid, while big financial institutions such as Citigroup gave up relatively little to secure much larger amounts of taxpayer money.
"Are we going to blame the autoworkers, who are, by the way, 10 percent of the cost of an automobile ... or are we going to take a look at what's happened to our economy, to the housing crunch, to the Wall Street bailout and the failures on Wall Street?" Gettelfinger said during a televised Detroit news conference as union members cheered.
"I'm having a little problem myself here understanding why there's a double standard here, but we accept it, and we'll play by those rules," he said.
The union's announcement came one day after General Motors said it faced insolvency by the end of the year without $4 billion in immediate federal aid, with billions more needed in 2009. Chrysler said it needed $7 billion or could run out of cash early next year. And Ford, which requested a "standby line of credit" of up to $9 billion, warned that a failure by one of its U.S. competitors could take the others with it.
Michigan Republican Rep. Fred Upton, co-chairman of the House Auto Caucus, said the union moves should help sway skeptical lawmakers. "Everyone's got to tighten their belt; that includes the UAW as well as management," he said.
The Detroit CEOs performed so poorly in requesting federal help last month that Democratic congressional leaders told them to deliver detailed turnaround plans this week and gave them a second chance to plead their case.
