CBS MarketWatch -- Aug 4, 1999
DETROIT (AP) -- Ford Motor Co. faces a possible showdown in national contract talks with the United Auto Workers over the potential spinoff of the No. 2 automaker's Visteon Automotive Systems parts unit.
The union has scheduled an Aug. 17 strike-authorization vote at Ford plants nationwide. Though such votes are routine every three years before the UAW contracts with Detroit's automakers expire in September, holding one at all of a single company's locals on the same day is unusual.
Analysts say the vote is meant to send a strong message to the No. 2 automaker, which has enjoyed relatively smooth relations with the UAW for more than 20 years but is feeling heat this year over Visteon.
The union opposes a spinoff, fearing it could bode poorly for its 28,500 members at Visteon.
The vote is "a very slight wake-up call, just to signal that this is an important issue and that the union is absolutely prepared to strike, if necessary," labor Professor Harley Shaiken at the University of California-Berkeley said Wednesday.
A strike authorization vote does not necessarily mean there would be a strike. Union leaders are required to seek rank-and-file authorization before calling a walkout. Workers usually vote overwhelmingly in favor of a strike, typically as a show of support for their union negotiators.
UAW spokesman Paul Krell played down the vote, saying such balloting is "always done at all locations in a very narrow window anyway." Similar votes are planned at General Motors Corp. and DaimlerChrysler AG plants, though not on a single day.
But he did not dismiss the importance of Visteon to the UAW, given union sentiments that job security for generations of autoworkers current and future "are very much of paramount concern."
Peter Pestillo, the Ford vice chairman who is the chief architect of the company's successful labor relations, declined to comment on whether UAW leaders were trying to send Ford a message.
"You'll have to ask them how they feel about what they're doing there," he said.
The UAW's strike vote comes as the union continues separate negotiations that began in June with DaimlerChrysler, GM and Ford. Their contracts expire Sept. 14, and talks are expected to intensify around Labor Day.
Ford has not yet stated its plans for Visteon, but has said it's considering a spinoff. There also have been reports that Ford (F: news, msgs) is considering merging Visteon with Lear Corp. (LEA: news, msgs), another large parts maker.
Pressure for a spinoff has increased since GM (GM: news, msgs)distributed shares in its Delphi Automotive Systems parts unit to GM shareholders in May after an initial public offering in January. Delphi is the world's largest auto parts manufacturer, followed by Visteon.
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