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UWA, Ford discuss health care

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The UAW has started talks with Ford Motor Co. on changes to retiree health-care benefits but will conduct a thorough analysis of the automaker before it agrees to any deal, union president Ron Gettelfinger said Wednesday.

Last week, General Motors Corp. hourly workers approved with 61% of the vote a deal between the UAW and the automaker that would force retirees to pay more for their health-care costs. That deal paves the way for Ford and Chrysler Group of DaimlerChrysler AG to seek similar concessions from the union.

"We will do an in-depth analysis at Ford before entering into discussions, which are under way now," Gettelfinger told reporters at a news conference in Detroit about automotive supplier Delphi Corp., now in bankruptcy court.

The UAW agreed to the health-care concessions with GM after a group of outside experts, including investment bank Lazard Ltd., said in an analysis that the company needed the union's help.

GM Chief Executive Rick Wagoner has been much more vocal than Ford about health-care expenses. But Ford is also facing rising costs, and it projects that its health-care expenses will rise to about $3.5 billion this year from $3.1 billion in 2004. Ford's U.S. health-care plan covers 550,000 salaried and hourly workers, retirees, dependents and spouses.

When asked about talks with the UAW on Wednesday, Ford spokesman Tom Hoyt repeated a statement from the automaker last month that Ford and the union "continue to have very private and constructive discussions to address Ford's health-care cost reduction needs."

Gettelfinger said the UAW has not held any discussions with Chrysler yet and it's focused on reaching a pact with Ford.

Chrysler spokesman David Elshoff said the automaker expects a deal with the union similar to the deal reached with GM.

"Based on the tradition of pattern bargaining, we would expect something similar," Elshoff said.

Under the deal reached with GM, many UAW retirees with traditional health-care plans would for the first time pay monthly contributions, annual deductibles and coinsurance, the UAW said.

Active hourly workers would see few changes in their health-care plan. Instead, they would defer $1 an hour from pay increases due in 2006, or at least $2,000, into a fund to help pay for health care. By the end of 2006, that deferral would increase by 2 cents an hour every quarter. Workers who put in overtime would pay more.

GM's changes to retiree health-care benefits are subject to approval by the U.S. District Court for the Eastern District of Michigan.

The UAW filed a lawsuit against GM in October seeking a court declaration that the UAW could change retiree health-care benefits.

The deal between the UAW and GM lasts until at least September 2011, according to a summary given to GM workers.

In court papers submitted Monday, GM asserts that it has the right to unilaterally change or eliminate retiree health-care benefits in the future. The UAW disagrees.

"It's always been our position that the corporation could not change benefits. That's still our position," Gettelfinger said.

One Ford hourly worker Wednesday said he expects Ford workers will agree to a deal on health-care concessions in order to help the company.

"I think it's inevitable that it's going to occur," said Jim Pitts, a millwright at Ford's Michigan Truck assembly plant in Wayne, where it builds the Ford Expedition and Lincoln Navigator sport-utility vehicles.

"This is short-term relief for automotive companies. This is not the answer," said Pitts, who added that Washington lawmakers need to do more to make health care affordable.

Gettelfinger said talks with Ford are not part of the restructuring the automaker is scheduled to announce early next year for its struggling North American operations, which posted a pretax loss of $2.1 billion for the first nine months of the year.


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