Rush Limbaugh right again. UAW to get 55% Chrysler ownership and Board Seats. Government gets 10%. Fascism replaces quality as ‘Job #1′.
Rush Limbaugh has claimed for some time that one of the goals of the Obama Administration is to turn control of the auto industry over to the UAW. It appears that Rush was right as the latest deal has the UAW controlling 55% of Chrysler LLC. The U.S. government gets 10% as well.
In real terms that means that anyone that sits as the leader of the DNC controls 65% of Chrysler LLC. Full story from Bloomberg here.
April 28 (Bloomberg) — The United Auto Workers union’s retiree health-care fund will own 55 percent of Chrysler LLC in exchange for cutting in half the automaker’s $10.6 billion cash obligation to the trust, people familiar with the matter said.
Under the terms of the contract, the trust would get representation on the company’s board of directors, said two people briefed on the deal, who asked not to be named because the matter is private.
The tentative agreement was approved unanimously by UAW leaders yesterday and will be sent to union locals for ratification, one of the people said. Chrysler, operating with $4 billion in U.S. loans, faces an April 30 deadline to restructure its costs or risk losing government support.
“With employees effectively sharing the risks, this could play to the advantage of the ailing company,” said Howard Wheeldon, a senior strategist at BGC Partners LP in London. The UAW role, if confirmed, may be the only “feasible way of moving forward,” he added.
The U.S. Treasury, which still is negotiating on Chrysler’s behalf with the company’s secured lenders, has little room to give the banks more equity. Fiat SpA would get 20 percent of the company to start, with the ability to increase ownership to 35 percent by hitting performance goals. The Treasury would keep 10 percent.
Shawn Morgan, a spokeswoman for Auburn Hills, Michigan- based Chrysler, declined to comment on the tentative agreement “as it still needs to be ratified,” she said in an e-mail.
In the 1980’s Chrysler was about “Quality, hard work and commitment” and Ford was “Quality is Job #1”. It appears that in the Obama years Detriot has changed to “Fascism as Job #1”. Best of luck to the employees and customers of Chrysler. GM – your next.