American Axle, striking UAW edge closer to contract deal
DETROIT—Striking workers at American Axle and Manufacturing Holdings Inc. said Thursday they have been told the union and the auto parts supplier are close to a deal that could end a two-month strike.
Worker Ken Krzycki said a local union official told picketers some details of the possible settlement on Wednesday.
It includes negotiating the closure of American Axle's Detroit and Tonawanda, N.Y., forge operations. The possible settlement also includes wage cuts for production workers to $17 an hour from about $28.
Local 235 President Adrian King confirmed the numbers and said the union is evaluating the proposal.
American Axle spokeswoman Renee Rogers said talks were moving forward but she would not comment on specifics.
"It is moving along," she said. "But in terms of when we're going to have anything, I couldn't begin to speculate."
A resolution of the strike would have big implications for General Motors Corp., a major customer. American Axle makes axles, drive shafts and stabilizer bars mainly for large GM sport utility vehicles and pickup trucks.
GM said Wednesday the strike, which has affected 30 plants, cost it $800 million and 100,000 vehicles in the first quarter -- although several analysts said GM would have had to cut that production anyway due to slow demand.
American Axle workers were told that skilled trades employees such as electricians would see their wages cut to $25.50 an hour from roughly $32.
The company would pay workers $90,000 "buydowns" over three years to ease the transition to lower wages, and it would offer $140,000 over two years for workers to sever all ties with the company, said Krzycki, 59, who has 11 years with the company.
Without seeing all the details, Krzycki said he thinks the framework of the deal could be approved by workers, who have been on strike since Feb. 26. The buydowns would be appealing to many, he said.
"A lot of guys are hurting out there," he said. "Nobody anticipated the 8-week-long strike."
Workers at the Tonawanda plant said Thursday they had been told nothing by the union about the possibility of their factory closing, but they weren't surprised by the reports.
"They don't want to do business in New York state," Dwayne Manning, 39, of Hamburg, N.Y., who has worked at the plant 14 years, said of American Axle. "They want to consolidate everything local and they want a low-wage plant left because they want some presence in the United States and everything done overseas. Globalization. How can you compete against the Mexican workers, the Chinese? You can't. You can't."
About 3,600 UAW members in Michigan and New York went on strike in a dispute over the company's demands for lower wages and benefits.
But worker Steve Gerard of Troy said the wage cut may be a tough sell because workers bought houses based on the current wages. With the cuts, they may not be able to make the payments.
"I don't think you'll be able to maintain your home," he said.
The possible agreement was reported Thursday by the Detroit Free Press.
Wall Street reacted positively to news of the possible settlement. American Axle shares closed up $2.57, or 13 percent, at $22.71.
GM President and Chief Operating Officer Fritz Henderson said Thursday in Washington, D.C., that GM is staying out of the talks, yet it has encouraged both sides to resolve it.
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Associated Press Writers Ken Thomas in Washington and Carolyn Thompson in Tonawanda, N.Y., contributed to this report.
