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GM, Ford, Chrysler UAW Leaders Call Emergency Meeting (Update2)

By Jeff Green and John Lippert

Dec. 1 (Bloomberg) -- General Motors Corp., Ford Motor Co. and Chrysler LLC union leaders will meet Dec. 3 in an emergency session in Detroit as the companies seek concessions to win $25 billion in loans with plans due to be sent to Congress tomorrow.

United Auto Workers officials will be asked to reopen a 2007 labor agreement, said one person familiar with the forum, who asked not be named because it’s private. Two delegates from each UAW local are invited, according to a copy of a letter obtained by Bloomberg News from a person planning to attend.

GM, at risk of running out of operating cash this year, wants to stop paying union workers when plants are closed and there is no other work, people familiar with the company’s plans said. Ford and Chrysler likely will ask for similar concessions to help them get government aid, two union officials said today.

A UAW spokesman, Roger Kerson, had no immediate comment on the meeting.

GM also aims to change how it pays for a union-run retiree health care fund as part of a broader cost-cutting plan designed to win government aid, people familiar with the strategy said.

The meeting is scheduled for 10 a.m. Dec. 3 at the Detroit Marriott Hotel attached to GM’s headquarters building. Meetings of each automakers’ union groups are supposed to follow the joint session, according to the notice.

UAW President Ron Gettelfinger said Nov. 21 that he was working to help find ways to cut costs at U.S. carmakers, signaling the union may be flexible in making concessions to push through an aid package.

‘Every Day’

“We are at the bargaining table every day working on things to make these companies, to put them in better shape if you will,” Gettelfinger said in an interview on Bloomberg Television’s “Political Capital with Al Hunt.” “Other people need to come in to see what they can do to assist these companies.”

The union agreed last year that new hires would have hourly pay and benefits reduced to about $26 from about $78 and wouldn’t be eligible for fixed-benefit pensions. The 2007 accords also call for creating the union-managed trusts that will take over retiree health-care obligations starting in 2010.

Still, the UAW has resisted calls to yield more to help advance a U.S. bailout without concessions from debt holders and the company.

Labor Costs

Lawmakers including Alabama Representative Spencer Bachus, the top Republican on the House Financial Services Committee, have cited UAW costs as one reason Congress couldn’t support using taxpayer dollars for automakers.

House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid accused automakers of being unprepared last month after two days of congressional hearings failed to convince lawmakers the companies should get $25 billion to avoid an industry collapse. Congress ordered that new plans be presented tomorrow.

Gettelfinger, who also testified before Congress Nov. 18 and 19, has said repeatedly Congress must give bridge loans to the automakers to get through 2009 or risk an industry collapse.

UAW membership fell 14 percent last year to the lowest since the Great Depression as the U.S.-based automakers, scaling back to stem losses, paid factory workers to quit or retire early.

UAW membership, which peaked at 1.5 million in 1979, declined to 464,910 at the end of 2007, according to the Detroit-based union’s annual report to the U.S. Labor Department. The loss for the year amounted to 73,538 members.

The UAW, formed in 1935, organized GM and Chrysler in 1937 and Ford in 1941.

To contact the reporters on this story: Jeff Green in Southfield, Michigan, at jgreen16@bloomberg.net; John Lippert in Chicago at jlippert@bloomberg.net

Last Updated: December 1, 2008 22:34 EST

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