United Auto Workers ends health benefit discussions with Chrysler

DaimlerChrysler AG's Chrysler Group and the United Auto Workers on Friday ended discussions on health care, "shutting the auto maker out of cost concessions the union has given General Motors and Ford Motor companies in the past year," the Wall Street Journal reports (Stoll/Boudette, Wall Street Journal, 9/9).

UAW President Ron Gettelfinger on Thursday said the union will not enter into the same health care concession agreement with Chrysler as it did with Ford and GM because Chrysler is in better financial condition (Kaiser Daily Health Policy Report, 9/8).

After a "long string of profitable quarters," Chrysler is expected to announce a $600 million loss for the third quarter, although parent company DaimlerChrysler should remain profitable, according to the Journal.

Chrysler expects to spend $2.3 billion on health care related costs this year, equaling $1,400 per car built, the company said.

David Cole, president of the Center for Automotive Research, said the company's health care costs could decrease to about $800 per car if UAW concedes to health care concessions similar to those reached with GM.

Cole added that Chrysler's anticipated announcement of Q3 losses "might make things easier" in bargaining with UAW (Stoll/Boudette, Wall Street Journal, 9/10).