(Published Saturday, September 29, 2007 01:20:41 AM CST)
A d v e r t i s e m e n t
Associated Press and Gazette staff
It appears the Janesville General Motors plant will be building the big sport utility vehicles well into the next decade.
Janesville is one of 16 GM plants across the United States that is guaranteed work under terms of the new, tentative contract, according to a summary released Friday by the United Auto Workers.
GM also will put $29.9 billion into a fund for retiree health care as part of its tentative agreement with the union.
GM will pay an additional $5.4 billion to fund retiree health care while the UAW is setting up the health care trust, which the union will manage.
The formation of the trust, called a Voluntary Employees Beneficiary Association, or VEBA, was a major part of this year's contract agreement. GM has around 340,000 retirees and spouses.
A source familiar with details of the contract told The Janesville Gazette that Janesville's plant will be making the next generation of Suburbans and Tahoes, if the contract is ratified.
The tentative agreement calls for the Janesville plant to continue to make the current SUV models through 2012, according to the Automotive News Web site, and the medium-duty truck line is guaranteed to continue through 2009.
Janesville's GM plant includes a small line that makes medium-duty Isuzu trucks, but most workers are involved in assembling the large SUVs.
The agreement calls for the Janesville plant to begin making "C3XX full-sized truck and SUV replacement for current GMT 900 full-sized truck and SUV products beginning in 2013," according to Automotive News.
GMT 900 is the designation for the current large pickups and SUVs.
GM spokesman Tom Wickham would not explain the C3XX designation. He said he could not describe future products because GM and the UAW had agreed that the UAW would be the one to explain the tentative agreement to its members while GM would remain silent.
The source, however, specified Suburbans and Tahoes, so it appears C3XX is the designation for the new generation of large SUVs.
The tentative agreement also guarantees work at GM's plant in Arlington, Texas, the only other U.S. plant that makes big SUVs. Arlington also continues to make SUVs through 2012 and then begins C3XX production in 2013.
Also under the tentative contract, 3,000 temporary workers will get permanent jobs at the full-time wage rate. There also is a moratorium on outsourcing.
Hourly workers will get economic gains totaling $13,056 over the life of the four-year contract, the UAW said. But some workers will be getting less than before.
New hires who aren't doing direct manufacturing jobs, such as groundskeepers, will make between $14 and $16 an hour, according to the summary. Manufacturing workers would make a starting wage of $28.12 under the new contract. There are 16,000 people doing non-core work in U.S. plants, the UAW said.
The tentative contract passed a hurdle earlier Friday when UAW officials from across the U.S. approved the pact.
UAW President Ron Gettelfinger said at a news conference that local union leaders will now take the pact to the 74,000-strong membership for a vote. He said the voting would wrap up and be counted by Wednesday, Oct. 10.
Gettelfinger called the guarantees on building cars and trucks at U.S. plants "unprecedented" and said he expects the tentative agreement to pass, although some members have concerns about its terms.
"We're happy with this stuff," he said.
Gettelfinger also said the union had not yet picked the automaker-Ford Motor Co. or Chrysler LLC-with which it would bargain next.
If the company's UAW members ratify the deal, its provisions likely will save the company about $3 billion per year, which it can pump into the development of new products, according to industry analysts.
GM will put $24.1 billion into the VEBA in January, although the fund won't start covering retiree health care until 2010. GM will make up to 20 additional $165 million payments to the VEBA anytime the fund's level is insufficient to provide benefits for at least 25 years.
GM will be required to pay cash interest on a $4.37 billion convertible note for the benefit of the VEBA, and the fund's trustees will be able to convert that note to GM stock. GM's active workers also will be required to contribute 4 cents per quarter for the VEBA.
GM shares rose 16 cents to $36.62 in late trading Friday after rising as high as $37.75 in earlier trading.
GM made commitments to build current or future products at 16 factories nationwide. Because assembly plants need parts from other GM plants, the commitments also protect jobs at dozens of engine and transmission, stamping and metal fabrication factories, the UAW summary said.
Details of the tentative deal thrilled Dave Green, president of one of two local unions at the Lordstown, Ohio, assembly complex, because the company committed to build a new global small car at his plant.
"The whole thing looks fantastic," he said.
The agreement, he said, preserves wages and health care for active workers "and we've done creative stuff that's going to make the company profitable in North America."
