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UAW Says Blame Economy, Not Contracts

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The Associated Press

Published: November 16, 2008

COLUMBUS, Ohio - Even as Detroit's Big Three teeter on the edge of collapse, United Auto Workers President Ron Gettelfinger said Saturday the problem is not the union's contract with the automakers and that getting the companies back on their feet means finding a way to turn around the economy.

"The focus has to be on the economy as a whole as opposed to a UAW contract," Gettelfinger told reporters on a conference call, noting that labor costs now make up 8 percent to 10 percent of the cost of a vehicle.

Gettelfinger blamed the problems the industry is suffering from on things beyond its control - the housing slump, the credit crunch that has made financing a vehicle tough and the 1.2 million jobs that have been lost in the past year.

Gettelfinger also called on Congress to act quickly on a bailout plan for the auto industry, saying action is necessary before President-elect Barack Obama takes office in January.

He said if one automaker were to file for bankruptcy, the others may follow, and that automakers would find it difficult to restructure under bankruptcy laws and instead could end up out of business.

The Center for Automotive Research, which receives funding from the auto industry, has warned that the collapse of the Big Three could set off a catastrophic chain reaction in the economy, eliminating up to 3 million jobs and more than $150 billion in tax revenue during the next three years.

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