Profit-Sharing for UAW Members at Ford and GM -- Well, Those Still With Jobs
It looks like some surviving members of the United Auto Workers will get the biggest profit-sharing checks from Ford (F) and General Motors (GM) they've seen in years -- at GM, in fact, the only profit-sharing checks workers have seen in years.
The checks are some measure of reward from the turnaround in Detroit, which after all the union helped bring about by making big concessions. Chrysler and GM fell into bankruptcy in 2009, and Ford suffered a near miss as well.
UAW President Bob King said in a speech yesterday to the Automotive News World Congress in Detroit that the U.S. government bailout that saved Chrysler and GM also saved more than 1 million jobs, counting those at suppliers, dealerships and other related segments in addition to the automakers themselves.
Meanwhile, the watchdog Congressional Oversight Panel that's keeping an eye on the government's bailout of Chrysler, General Motors and the former GMAC (now Ally Financial) had some harsh criticism for how the Treasury Department, and by extension the Obama Administration, are going about trying to recoup taxpayer money.
As financial analysts celebrate the turnaround in Detroit, it's important to keep in mind that the U.S. automakers are roughly half the size they were just a few years ago. The UAW suffered tens of thousands of lost jobs, and at a critical point the union accepted stock in Chrysler and GM in lieu of cash as contributions to the fund that supports some union benefits. Since coming out of bankruptcy, the companies have added back some jobs.
Earlier, the UAW also signed off on the car companies shifting health care costs to a trust fund to which the car companies contribute. The other side of that coin is that the car companies complained spiraling health care costs were a big contributor to their shrinking profits.
According to press reports, profit sharing checks for Ford workers could top $5,000 apiece. Checks would be smaller for GM workers, since GM isn't doing as well as Ford. Chrysler is expected to post an operating profit for 2010 but a net loss overall.
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Photo: UAW