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Union, Yes! (maybe)

The workers at the plant are voting on whether or not to join a union. The vote is controversial, setting the company and local politicians at odds with each other in a bitter struggle playing out in the press and even on billboards around town. If you think you’ve seen this story before, hold on a moment.

In Chattanooga Tennessee the workers are finishing up voting to possibly join the United Auto Workers (UAW) today. Volkswagen, the owner of the plant, has no official position on the vote but were the ones who initiated the process last October. The opposition comes from local officials who are terrified of unions coming in. They’ve made it clear that if the UAW successfully organizes the plant they will cut off all future tax breaks and generally make life difficult for VW. Welcome to a new world of global companies meeting the strange cultural war of the USA in 2014.

VW Chattanooga - a very modern, efficient auto plant.

VW Chattanooga – a very modern, efficient auto plant.

The plant itself is a remarkable facility. It is the first LEED Platinum certified auto plant in the world, with 33k solar panels and an elaborate waste water recovery system. It employs 3200 people and was built with a cool $1 Billion invested by VW matched with $577M in local tax incentives. The plant opened in 2011 with production of 85% of a VW Passat sold in North America all coming from this one facility, an unusually concentrated amount of production. It’s a truly remarkable plant in many ways, and Tennessee lobbied hard to win VW’s investment over Michigan and Alabama.

There was only one problem with the plant, as far as VW was concerned. All of the other VW facilities around the world operate with what’s called a “Works Council”, or an employee run system of providing input to much of the daily operation of the plant. This is a typical German system that has proven to be very effective for VW. It’s part of their process of engaging workers to ensure a quality product and a happy, dedicated workforce.

What it takes

What it takes

In order to put such a system in place here in the US, VW found that it only made sense to unionize the employees – as they are in Germany. Last October the UAW agreed to run the Works Council, a first for them, and treat the VW contract as fundamentally different from the way they deal with other US automakers. All that stood in the way was the organizing vote among the workers, taking place 12-14 February.

If that sounds like a great compromise between labor and management, you’re far from alone. But not everyone would agree with you.

Tennessee Governor Bill Haslam and Senator Bill Corker are both livid, to say the least. They see their state’s competitive position as being fundamentally non-union, and they are responding as if the UAW is something like a virus coming in to infect their state. Nevermind that the steel mills of Alabama have been union for a century – the line is that Dixie must remain union-free to continue the rapid growth they have seen over the last few decades.

One of the billboards around Chattanooga.

One of the billboards around Chattanooga.

That’s why Gov Haslam and legislative Republicans have warned that if the UAW organizes the plant VW can forget about future tax breaks if they want to expand. Anti-union groups have put up billboards around town telling workers that the UAW created the mess we now call Detroit, featuring a nasty picture of the old Packard plant in the Motor City.  Grover Norquist, among others, is a leader in the fight and bringing in a lot of national money to influence the workers to reject the UAW.

In desperation, Sen Corker announced on the first day of voting that if the workers reject the UAW, VW will expand the plant to build a new SUV. This left everyone puzzled, largely because it goes against everything VW has said and done so far. The company has tried desperately to keep out of the fracas, given their goal of simply organizing a Works Council like they have everywhere else. The company quickly denied Sen Corker’s statement, but is clearly trying to say as little as possible to avoid being dragged into domestic politics.

What will finally happen? The final decision will rest with the good workers of the plant, as it should. They get to decide how this chapter of the story ends. Most observers think they will approve the UAW and VW will get its Works Council.

But, of course, it won’t stop there. A global company that is clearly trying to run with modern efficiency, worker relations, and respect for the environment has run headlong into domestic politics and an ideological war that they had no idea would be so divisive. What should be a simple process has become twisted and surreal.

The version of the story you were probably expecting, where workers organize and overcome bitter opposition from management? So old school. That story, like everything else, has succumbed to a political and cultural war that no one involved could have ever anticipated.

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15 thoughts on “Union, Yes! (maybe)

  1. Living in Tennessee, I honesty cannot understand the view of our politicians. It was tax breaks that got VW to Tennessee, so you then cut them off if they unionize. So, then what? Seems to me, you risk the very strategy that brought business to Tennessee. Do they think that other businesses won’t come to Tennessee because of unions? It’s a right to work state! It doesn’t matter! But tax breaks do. This is so anti-worker and so not serving the constituents in this state that it is breath-taking! And the lies about Detroit? Come on. Detroit’s problems are not because of unions.

    • Thank you, and I’d love to hear more from you as to how it’s going. I’m sure this story is far from done, even after the vote.
      I’m simply stunned that what looks to me like a new chapter in management-labor relations forged as a great compromise is controversial at all. If VW wants to run their plant this way – well, more power to ’em. If they are successful perhaps everyone will copy them – and if they aren’t it’ll go down as a failed experiment. Why not try something new? They’re putting their money down on it. It certainly can’t hurt workers.

  2. Simply unbelievable. Ideology gets in the way of everything yet again. Don’t think that the left doesn’t do this too, I am sure they would knee-jerk support the union just because its a union. But that would be stupid and so is this. Let VW run their plant the way they want.

    • If the left starts doing things like that, I promise you I’ll be on top of it like this one. But they’ve been out of power for a long time and I don’t see that coming any time soon.

      Yes, let’s just let VW run the plant as they want to – given that they aren’t doing anything harmful.

    • I’m a bit surprised that he’s directly involved in this. I thought his schtick was all about tax cuts. So this is a bit strange – but it is the “usual suspects”, yes.

  3. Update: At the end of voting on Friday, Volkswagen workers voted against joining the union in a vote of 712 to 626.

    “While we certainly would have liked a victory for workers here, we deeply respect the Volkswagen Global Group Works Council, Volkswagen management and IG Metall for doing their best to create a free and open atmosphere for workers to exercise their basic human right to form a union,” said UAW President Bob King.

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