20071008 uaw chrysler talkls 18
Chrysler Group President and CEO Tom LaSorda offers his hand to United Auto Workers President Ron Gettelfinger to officially open the 2007 contract negotiations in July. The two shook hands. - 


KAI RYSSDAL: We bring you now the second installment of this fall's auto industry labor negotiations. Last month, 73,000 General Motors employees went on strike for two days after GM and the UAW couldn't agree on a new contract.

Today, the UAW gave Chrysler a Wednesday strike deadline -- Marketplace's Alisa Roth has more:

ALISA ROTH: The union's plan was to use the deal it made with GM as a model for its contracts with Chrysler and Ford.

Gary Chaison studies labor relations at Clark University -- he says the UAW's new deadline suggests things might not be going as planned:

GARY CHAISON: They're trying to create an impression on Chrysler that they had better start talking more carefully and more intensely about some of things on the table.

Exactly what's on the table isn't clear. Negotiations are private, and neither side is talking to the press. Chaison speculates a deadline might push Chrysler to actually start negotiating.

CHAISON: But the real problem might be the UAW's tactics, since Chrysler and GM are actually two very different companies. So a contract that suits GM may not fit Chrysler.

Erich Merkle is an auto industry consultant. He says GM's big concern was high healthcare costs. Not so Chrysler:

ERICH MERKLE: They would probably like more immediate cost-cutting measures to take place, such as the closure of plants.

He says it's unlikely a private equity company like the one that runs Chrysler would agree to a contract that guarantees jobs. And he says the threat of a strike might not bother Chrysler anyway.

MERKLE: Chrysler could afford a strike, because they are in a position right now where they have a tremendous amount of inventory out there.

The company's already idled several plants this month. Chrysler needs to clear out some inventory before it makes any more new cars.

In New York, I'm Alisa Roth for Marketplace.