GM pact provides work for NE Ohio

Lordstown won't get the Volt plug-in hybrid, but General Motors' sprawling plant near Youngstown will stay open and get three new cars by 2011.

“We are very, very excited,” said Jim Graham, president of the UAW Local 1112 in Lordstown. “Things are going to start moving rapidly.”

The cars, a fuel-efficient subcompact and two others, are listed in GM's tentative contract with the United Auto Workers, union officials said Friday.

The contract trades concessions on wages and health care for guarantees of new work for GM employees.

The framework was key for getting a new car for Lordstown's 3,400 workers. The Chevy Cobalt and Pontiac G5 built there are scheduled to go out of production in 2009.

Without new vehicles, the plant could have closed.

According to a summary of the contract obtained by the Detroit Free Press, Lordstown will get two new cars in 2011.

Rebecca Lindland, an analyst with Global Insight in suburban Boston, said they should be similar to the Pontiac G6.

The Cobalt-sized cars the plant now makes appear to be headed for Hamtramck, near Detroit. Hamtramck also will get the Volt, a Chevrolet plug-in hybrid that analysts had expected in Lordstown.

Instead, in 2010, Lordstown will get a four-door hatchback-like vehicle similar to the European Opel Corsa. GM has been taking European Opel designs and selling them as Saturns in the United States for the past year, and Lindland believes the Lordstown four-door will be a small Saturn.

“It has the potential to bring them a bit more into premium cars, too,” Lindland said. GM plans to produce an entry-level Cadillac crossover vehicle in the next few years. That vehicle could be built on the same assembly lines as the cars coming to Lordstown in 2011.

Lindland added that getting cars on radically different platforms — the basic foundation of the car — should be great for Lordstown.

“Ideally, you want plants that have multiple platforms and multiple vehicles on those platforms so you have flexibility,” Lindland said.

At most U.S. Honda and Toyota plants, for example, workers can make small and large cars on the same assembly lines. When gas prices go up and consumers demand small cars, the plant can instantly switch production. If large cars come back into favor, it’s easy to switch back.

Graham said flexibility will be great for the plant, and he’s excited to get a highly fuel-efficient vehicle in an era of high gas prices.

“I haven’t seen a model yet, but I’ve been told they look great and they get great mileage,” Graham said.

Graham and other local presidents unanimously ratified the contract Friday afternoon. Representatives from the union will brief rank-and-file members on details next week before they vote on the agreement.

At GM’s Parma Metal Center, the union scheduled briefings and the ratification vote for Thursday. At Lordstown, the union will hold briefings on Friday and next Saturday, and members will vote the next week.

The UAW expects all of its locals to vote by Oct. 10.

The groundbreaking contract includes several provisions that could save GM billions of dollars per year. According to the contract summary, the labor deal contains the following provisions.

GM will contribute $29.9 billion to a union-run trust fund that will handle retiree health-care coverage. Analysts estimate GM’s long-term health-care obligations now total $51 billion. GM agreed to make more contributions in the future if the fund runs low, but those commitments are limited. A portion of union members’ cost-of-living increases also will go into the fund.

New hires at GM plants will be given non-core jobs in areas such as material handling and maintenance. Those jobs will pay about $15 per hour, or about half of what assembly workers earn. In addition, those hires will receive 401(k) retirement programs instead of traditional pensions. If new workers move to the assembly line, they will get the higher wages but not the pension.

Instead of raises, workers will receive $13,056 in bonuses over the four-year life of the contract. Workers in non-core jobs also will be offered buyout packages if they don’t want to take the pay cut.

GM committed to future investments at Lordstown and 15 other plants, many of which were considered potential targets for closing.

UAW President Ron Gettelfinger said the contract puts a “total moratorium on outsourcing” UAW jobs to suppliers, the Associated Press reported.

Gettelfinger said the union will restart talks with Ford Motor Co. and Chrysler LLC on Monday. Talks with those companies had been on hold pending the outcome of the GM talks.

The union’s last four-year contract expired Sept. 14. The UAW had been granting hour-by-hour extensions to GM as it worked out details. On Monday, the company and union reached an impasse, and the UAW called its first nationwide strike since 1976.

Less than two days later, the company and union agreed to the new contract.

Tom Waltermire, chief executive of the regional economic development group Team NEO, praised the labor deal.

“It is clearly a great example of how much more competitive and productive Northeast Ohio manufacturing has become,” Waltermire said. “The Lordstown plant is a wonderful example of that.”

He added that keeping Lordstown open and giving it new products will help suppliers in the region that supply parts.

To reach this Plain Dealer reporter: rschoenb@plaind.com, 216-999-4059