Three stories making news across the Midwest today:

1. Big Three sales rise. Detroit automakers posted gains in annual sales Tuesday, although some leaps were not as large as anticipated. Chrysler showed the most significant improvement. Sales of its light vehicles rose 27 percent in October, year over year. Ford sales rose 6 percent overall and General Motors increased 1.7 percent, under expectations of a 5-to-7-percent increase. According to the Detroit Free Press, sales of the 2012 Ford Focus were largely unchanged over the year, but sales fell below the model’s chief competitor, the Chevrolet Cruze.

2. Pittsburgh seeks incoming residents. Upon winning $100,000, reality-show contestant Matt Kennedy Gould once dissed Disney World and proudly declared, “I’m going to Pittsburgh!” He’ll have some company. A promotional arm of the city is offering a $100,000 prize in a contest that aims to woo potential Pittsburgh residents. Officials seek what they call “experienced dreamers,” a euphemism for people 45 and older who are seeking a fresh start in a new city to “realize their dreams.” In New York City, the contest has some appeal. The blog Brokelyn notes, Pittsburgh boasts an unemployment rate below the national average and “the beer is really cheap.”

3. Toyota will export Siena. For the first time, Toyota will begin exporting the Siena from its U.S. assembly plant in Princeton, Ind. Shipments to South Korea are scheduled to begin in November. “We hope to continue boosting exports from our North American operations,” said Yoshimi Inaba, president of Toyota’s North American operations. In a written release, the company said it has exported several models of U.S.-made vehicles since 1988, and that overall, those exports increased 30 percent in 2010 to approximately 100,000 units. Sienna exports to South Korea are forecast at 600 annual units.


Three stories making news across the Midwest today:

1. Illinois Gov. rejects big gambling. After months of more subtle indications he would not sign a sweeping bill that opens Illinois to 14 new casinos, Gov. Pat Quinn made his position official with a blunt statement Monday. “I’m the final word,” he told the Chicago Sun-Times. “Casino gambling at 14 different locations in Illinois is way too much. We have no interest in becoming the Las Vegas of the Midwest.” Quinn suggested he would sign a scaled-down bill that allows for a Chicago casino and a handful of others – if some revenues boost education coffers in the state.

2. Ohio Dems push new referendum. An Ohio Supreme Court ruling Friday has paved the way for a Democrat-backed referendum on new congressional district lines. They consider the Republican-drawn lines unfair – a position backed by the court – and are seeking 231,234 signatures needed for a November 2012 referendum on the issue. The Columbus Dispatch reported Tuesday the entanglement could throw Ohio’s 2012 primary election “into chaos,” and the GOP-controlled state legislature, has been called into session this week to address the issue.

3. More jobs ahead at General Motors? After a decade of subpar offerings in the compact car market, General Motors CEO Dan Akerson tells the Detroit Free Press that, based on recent compact successes, he foresees adding more jobs on top of the 6,400 called for in the recent UAW contract, possible in Orion Township, Mich. and Spring Hill, Tenn. He foresees gradual introduction of more two-tier employees. “We’re not trying to hurt anybody,” he tells the newspaper. “We’re trying to stay strong. So over time, as part of the labor contract, we would buy out some of our more senior employees. … We’ll get there, but we don’t need to be punishing.”


The mood of several workers at Ford’s engine plant in Brook Park, Ohio, sums up the mixed feelings of the company’s workers nationwide: In a tentative contract agreement Ford struck with the United Auto Workers union last week, workers feel they’re not getting enough back to compensate for concessions in previous contracts.

The contract is faltering in early voting across the country, with 54.6 percent of voters so far rejecting the deal. Thursday afternoon, the UAW Ford Department said 3,256 workers had voted yes and 3,915 had voted no. Voting on the four-year deal is expected to end Tuesday.

Results from the Cleveland-area Brook Park plant were not yet known, but an early survey of workers showed results titled against the deal, and anger toward bonuses given to executives had risen.

“I gave up $20,000 a year,” between a lack of raises and moving from skilled trades to production,” Erich Ockuly, a Brook Park worker, told The Plain Dealer. “All that so Alan Mulally could make $24 million.”

Elsewhere, employees at a Chicago Ford plant overwhelmingly rejected the contract. UAW Local 551 reported Thursday morning that 77 percent of 2,317 votes cast went against the agreement, which offered a $6,000 signing bonus but no cost-of-living adjustment. Chicago Mayor Rahm Emanuel has endorsed the contract, saying it would create 1,100 new jobs in Chicago, according to our partner station WBEZ.

In Detroit, voting was more mixed. Sixty-six percent of production workers and 64.5 percent of skilled-trade workers voted yes on the deal, according to UAW Local 228, which represents 1,740 hourly employees at Ford’s axle plant in Sterling Heights. Earlier this week, Ford workers at a stamping plant in Wayne, as 51.5 percent rejected the contract, according to the Detroit Free Press.

Changing Gears senior editor Micki Maynard discussed the flagging support of the Ford contract during a Wednesday evening appearance on PBS NewsHour.

“The Ford workers, I think they feel they deserve more,” she said. “Their company didn’t take a federal bailout, and it really isn’t in bad shape at all. It’s in the most profitable position of any of the car companies.”

That is reflected in the contract agreement: Ford workers are faced with a better deal than their counterparts at General Motors and Chrysler. Ford workers would receive a $6,000 signing bonus, while GM workers will receive a $5,000 bonus; Chrysler workers would receive $1,750 upon ratification and $1,750 after the company hits certain financial targets.

(Here’s a handy chart that compares the basics of the three UAW contracts, courtesy of the Free Press).

If Ford workers reject the contract Tuesday, the company could lock out workers, the union could strike or the two sides could return to the negotiating table.


Three stories making news across the Midwest today:

1. Cleveland counts on small growth. In the past, economic development approaches in Cleveland have centered around big-ticket items. A new stadium. A new arena. The Medical Mart and Convention Center. That strategy is changing. Under Cuyahoga County’s new governing structure, executive Ed FitzGerald will target small-and-medium-sized business growth rather than large-scale projects. Our partner station Ideastream examines a proposal for a $100 million economic development fund that FitzGerald calls “a major commitment to business development.”

2. Tennessee GM plans will re-open. The contract agreement between the United Auto Workers and General Motors calls for the hiring of an additional 6,400 employees. Approximately 1,700 will be located at the company’s plant in Spring Hill, Tenn. The plant was initially shuttered in June 2009, but in a move that’s considered rare among industry insiders, the plant will re-open as GM seems to gain market share from Toyota. According to an Atlanta Fed analyst, the re-opening is one such reason “Tennesee could be viewed as a leader of the pack in automotive manufacturing strength,” throughout the nation.

3. Business school applications down. As prospective students grow leery of accumulating massive amounts of student debt, applications to most Chicago-area business schools have fallen. Crain’s Chicago Business reported Monday that applications at Loyola University’s Graduate School of Business have fallen 9.5 percent this year, applications at Northwestern’s Kellogg School of Management declined 5.6 percent. Applications at the University of Chicago’s Booth School of Business dropped 3.0 percent. DePaul was the only university in the Chicagoland region to buck the trend, noting a 13 percent jump.


Three stories making news across the Midwest today:

1. Midwest counties lead nation. Several counties in the Midwest are among the country’s biggest beneficiaries of increased employment and wages, according to new data released from the U.S. Bureau of Labor Statistics. Elkhart County in northern Indiana had the largest percentage increase in employment from March 2010 to March 2011 among the nation’s largest 322 counties, growing its workforce by 6.2 percent. Indiana’s overall employment increased 1.9 percent in the same time span. The next-largest increase belonged to Ottawa County in western Michigan, which grew at 4.7 percent. Peoria County, Illinois showed the largest year-over-year increase in average weekly wages, with a gain of 18.9 percent.

2. Illinois seeks Amazon taxes. Amazon.com has agreed to pay sales taxes in California. Officials are hoping that deal means the online retailer will agree to do the same in Illinois, according to a report in Crain’s Chicago Business today. The Illinois Retail Merchants Association has sent Amazon CEO Jeff Bezos a letter, saying “the tide is turning” and encourages the company to begin collecting Illinois sales tax immediately. Under the California agreement, Amazon agreed to go to Washington D.C. and lobby for national legislation that regulates how internet retailers should be taxed.

3. Big Three post sales gains. Strong sales of trucks and sport utility vehicles buoyed Chrysler in September, when sales rose 27 percent. The automaker led an impressive month for Detroit’s Big Three. Despite a struggling economy, General Motors posted sales gains of 20 percent and Ford’s sales rose 9 percent. “There is no double dip downturn going on around here,” Dodge brand president and chief executive Reid Bigland told The Plain Dealer in Cleveland. At General Motors, the Chevrolet Cruze continued to be the company’s best-selling car, although the sales of the Lordstown, Ohio-built Cruze dipped below 20,000 units for the first time in five months.


Three stories making news across the Midwest today:

1. Porsche’s place in Cleveland economy. Is there something illogical about opening a Porsche dealership in the midst of northeast Ohio’s economic turbulence? Not really, says Mark Naymik of The Plain Dealer. Porsche buyers are faring just fine, according to U.S. Census data. Naymik attended the grand opening of a Porsche dealership in suburban Beachwood, and examines the trickle-down role of such luxury purchases and the complexities of the regional economy — while also providing details on the regal evening.

2. Standard & Poor’s upgrades GM. After reviewing the four-year contract agreement between the UAW and General Motors, Standard & Poor’s announced today that it has upgraded the automaker’s debt rating from BB- to BB+. “We believe the contract will allow for continued profitability and cash generation in North America,” S&P’s Robert Schulz said in a written statement.

3. Michigan banks receive small-business boost. The U.S. Treasury announced today that five Michigan community banks would receive a total of $28.8 million in funding as part of the Small Business Jobs Act that President Obama signed into law. The money, distributed through the Small Business Lending Fund, encourages community banks to help small businesses expand operations and create new jobs. The Treasury said in a release that small businesses account for approximately 60 percent of job creation, but that such businesses are facing “disproportionate challenges in the aftermath” of the credit crisis.


Members of the Local 602, employed at the Lansing Delta Township Assembly plant above, voted against ratifying a new contract between UAW and General Motors. (Photo courtesy GM).

DELTA TOWNSHIP, Mich. – Auto workers at the Lansing Delta Township Assembly plant make some of General Motors’ most popular vehicles.

The GMC Acadia, Chevrolet Traverse and Buick Enclave are all produced inside this 3.4-million square-foot facility on the outskirts of Lansing, which is Michigan’s state capital.

In August, when GM announced an 18 percent sales increase from 2010, GMC led the turnaround with a 40.3 percent increase. Chevrolet had gained 15.8 percent.

So when contract negotiations began last month, the plant’s 3,430 hourly workers expected they’d be sharing in the company’s improved position. But when they saw the proposed deal between the United Auto Workers and GM, many members of UAW Local 602 here felt jilted instead.

They rejected the deal — a rarity for a contract approved by two-thirds of GM workers nationwide.

“The concessions we’ve made were supposed to be concessions, and with the stroke of a pen, they’ve made it all permanent,” said Jan Ward, a long-time employee who voted against the contract. “We did whatever we had to do to make them viable. Now they’re more than viable, and they just snubbed our nose, and said, ‘Too bad for you.’”

The majority of workers here agreed. Among Local 602 members, 66 percent of production workers and 57 percent of skilled trade workers voted against the contract.

In national voting, the percentages were nearly reversed: Sixty-five percent of UAW production workers and 63 percent of skilled trade workers approved the agreement, which was ratified Wednesday. Of the 81 UAW locals participating in the voting, Local 602 was one of only three to vote against the contract.

As first-shift workers at the Delta Assembly plant departed Wednesday afternoon, they cited a variety of reasons for the local departure from national sentiment. Some said concern over local union issues had spilled into voting on the national vote. (Local 602 president Bill Reed could not be reached for comment).

But the most-cited reason for the negative swing in Lansing was a feeling by veteran workers that they gained nothing from the contract.

“We’re really disappointed that GM didn’t give more back to us after all we’ve given to them,” said Larry Larner, employed by the company for 35 years. “They’ve always said they don’t like the adversarial approach. If they don’t like it, why don’t they come to us and say, ‘Look, we realize you gave up a lot, and we’ll try to give back to you.’”

Veteran workers got no raises, although there are raises in the contract for recently hired workers, known as “two-tiers.” Cost of living allowances, which were lost as part of the GM bailout, remain a thing of the past.

Larner said he reluctantly voted in favor of the contract. After years of union concessions in bargaining, he said, “We managed to keep what we had.” But his weariness in the face of those continued retreats mirrored the demeanor of many workers who voted no.

“We’re getting beat up,” said one 30-year employee who requested his name be withheld. “I don’t believe the union bargained in good faith. They’re looking out for themselves. GM is looking out for itself. And we’re not getting any help from either side.”

Veteran workers, their numbers diminishing, felt squeezed.

In 2005, GM had 110,000 hourly production workers, according to a presentation by CEO Daniel Akerson to Wall Street analysts Wednesday. Today, GM has approximately 49,000 hourly workers, less than half from six years ago.

The UAW said in a written statement the new deal will create 6,400 new jobs in the United States. But under terms of the contract, up to 25 percent of GM’s workforce can now be comprised of “two-tiers,” entry-level workers who will make about $8 less per hour than veteran counterparts. Now, two-tiers comprise 4 percent of the overall workforce.

Veteran employees at Delta Assembly fear a gradual wave of two-tiers, a slide in their own standard of living and a reduced vision of whatever comes next.

“ I don’t see where we gained anything in this, really,” said Tammy, a 26-year veteran who only gave her first name. “I thought maybe they’d get our cost of living back for us. That didn’t happen.”

She continued. “It only catered to the entry-level workers. The union let them agree to it. So where do you think we’ll be in a few years? We’re going to be dinosaurs.”

 


GM logo. Photo by Chris via Flickr.

General Motors gave some new details today on its just-ratified agreement with the United Auto Workers union. Among them: up to 25 percent of its workforce could be “two-tiers” — new hires at lower rates than veteran workers.

Changing Gears reporter Kate Davidson profiled two-tier workers last year. Right now, they’re only 4 percent of GM’s workforce, but the auto company clearly has plans for more of them.

There’s a caveat, though. In order for GM to hire more workers, auto sales have to pick up, company executives said during a conference call with Wall Street analysts. And it isn’t promising to hire the same number of workers as it sees sales go up: it will study its staffing needs and hire accordingly. 

The new contract runs through 2015 and caps the number of “two-tiers” at 25 percent at the end of the contract. It calls for the new hires to get a raise to nearly $20 an hour by 2015 (veteran workers are paid about $28 an hour now).

Other GM highlights:

– The number of people working in its U.S. factories has dropped sharply. GM had 110,000 hourly production workers in 2005, according to its presentation. In 2008, the year before it filed for bankruptcy production, GM had 78,000 U.S. workers. Now, GM has just 49,000 hourly workers, or less than half what it had six years ago.

– For the first time in 58 years, GM does not expect its pension expense to rise under the new contract. One reason is that newly hired workers will not be covered by GM’s traditional pension plan; they will receive a 401(k) retirement program instead.

– GM says it still has 700 workers laid off from their jobs. They have first dibs on jobs at GM plants, including the workers it plans to hire when it reopens its factory in Spring Hill, Tenn. Once those workers have been offered the chance to come back, then GM will hire new workers, including temporaries.

Read more about the GM contract in The New York Times.


General Motors became the first domestic automaker to reach an official agreement on a new contract with members of the United Auto Workers union Wednesday afternoon.

The UAW said in a written release that 65 percent of production workers and 63 percent of skilled trade workers voted in favor of the agreement, which had been tentatively agreed upon Sept 16. A four-year contract provides a wage increase for entry-level workers, and goes into effect immediately.

The agreement would create 6,400 jobs in the United States, the release said.

“When it seems like everyone in America is getting cuts in benefits and paying higher co-pays and deductibles, we were able to maintain and improve on our current benefits,” said UAW vice president Joe Ashton.

 


Three stories making news across the Midwest today:

1. UAW contract with GM nears approval. Late Tuesday night, it appeared members of the United Auto Workers had inched closer to ratifying a four-year contract agreement with General Motors. As voting neared a close, at least 18 major locals supported the deal while three had opposed it, according to the Detroit News.  GM CEO Dan Akerson will host a conference call with Wall Street analysts to discuss the deal this afternoon. Talks at Ford continue, while discussions with Chrysler “continue to lag,” according to the newspaper.

2. SB5 opponents link law to Jim Crow. We Are Ohio, the organized labor coalition seeking to repeal Senate Bill 5, is airing a radio ad in six urban markets that says Gov. John Kasich has led Ohio back to America’s Jim Crow past.  A portion of the ad states, that Kasich and other politicians “have passed two laws to take us back to the days of Jim Crow,” passing laws that make it more difficult for minorities to vote. In addition to SB5, a law that weakens collective-bargaining rights of public employees, the ad targets House Bill 194. Republican leaders tell The Columbus Dispatch the ad is race baiting. Democrats disagree. “It’s harsh wording, but it’s not necessarily inaccurate,” an Ohio State professor tells the newspaper.

3. Rahm rejects key budget-trimming ideas. Chicago Mayor Rahm Emanuel responded to a watchdog report that offered ideas on how to trim the city’s budget deficit by saying that suggestions to raise income, sales and property taxes are “off the table.” He also rejected the possibility of turning Lake Shore Drive into toll road. Emanuel said some of the other of 63 suggestions are “promising” and will receive “serious consideration,” according to our partner station WBEZ. This is the second year in which the inspector general has produced a budget options report.