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UAW, Chrysler to start talks over health care

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DEARBORN -- United Auto Workers leaders representing Chrysler Group's hourly workers agreed Tuesday to begin negotiations on concessions that would trim the company's rising health care costs.

Chrysler is pushing for an agreement that's similar in scope to the UAW deal with General Motors Corp., which will lower the larger automaker's health care costs by $1 billion a year.

In the past, the union has used pattern bargaining to secure almost identical labor contracts with Chrysler, GM and Ford Motor Co. hourly employees. Yet unlike its domestic competitors, Chrysler is profitable following a three-year turnaround, helped by popular new models and cost cuts.

So experts question whether Chrysler can secure major concessions. "Until and unless DaimlerChrysler can prove to the UAW that they don't have the ability to pay wages and benefits, they're not going to easily allow them to make changes," said Hal Stack, a labor studies professor at Wayne State University in Detroit.

The union vote at the Hyatt Regency hotel in Dearborn is a sign that the UAW may be willing to hear Chrysler out.

Seventy-five percent of about 200 bargaining council delegates who attended the two-day meeting, which ended Tuesday, voted in favor of negotiating on health care, said John Mehalshick, a committeeman at UAW Local 1183 in Newark, Del., who opposes the talks.

"I don't want to see employees pay anything for health care, not when Chrysler is making millions of dollars every quarter," he said.

Chrysler's third-quarter profits rose 43 percent to $374 million.

But the company has not been sheltered from soaring health care costs. Chrysler is expected to spend $2.2 billion on health care this year, up from $1.96 billion in 2004.

Talks between union and company representatives will begin soon, Chrysler spokesman Mike Aberlich said.

Full Story: http://www.detnews.com/2005/autosinsider/0.../C01-391559.htm
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