DaimlerChrysler talks at odds over out-sourcing

22nd July 2004, Comments 0 comments

22 July 2004, STUTTGART - Management threats to outsource 6,000 jobs emerged as the key stumbling block Thursday to resolving the biggest industrial action to hit DaimlerChrysler in decades, negotiators said.

22 July 2004

STUTTGART - Management threats to outsource 6,000 jobs emerged as the key stumbling block Thursday to resolving the biggest industrial action to hit DaimlerChrysler in decades, negotiators said.

Negotiators for the IG Metall trade union said they are standing firm on job guarantees for workers at DaimlerChrysler Stuttgart area assembly lines.

DaimlerChrysler is threatening to shift 6,000 jobs from the Stuttgart region to elsewhere in Germany or to South Africa.

"We want longterm job guarantees," said an IG Metall negotiation source.

Negotiators face a Friday deadline for resolving the impasse. Union officials threatened to stage nationwide walkouts unless management budges by Friday on its demands for cutting EUR 500 million in labour costs by trimming benefits and increasing the work week from 35 to 40 hours at no extra pay, it was said.

That threat came after negotiators adjourned early Thursday after a marathon, 13-hour bargaining session failed to bridge the gap between the two warring sides.

The unions blame DaimlerChrysler's financial woes on management's miscalculated takeover of the ailing Mitsubishi carmaker, which caused shares to nosedive.

Corporate executives meanwhile have signalled they were ready to accept a pay freeze if workers agreed to the cost-cutting measures from 2007 in connection with the production of the new C-Class Mercedes-Benz.

A wage freeze would be less of a concession than a 10 percent wage cut for executives which had been mentioned at the weekend by DaimlerChrysler CEO Juergen Schrempp in a bid to win a work week increase to 40 hours from the present 35 - with no extra pay.

This would be achieved by cutting wages, bonus payments, vacation time and work-day breaks.

Any freeze of executive pay would yield far more modest savings given that the DaimlerChrysler's top managers earned a total of EUR 40.8 million last year, according to the company's 2003 annual report.

If the cuts are rejected, DaimlerChrysler is threatening to shift some 6,000 jobs from the Stuttgart region to elsewhere in Germany or to South Africa.

DPA

Subject: German news

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