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Automakers Extend Contract Negotiations

RENEE MONTAGNE, host:

Major labor talks with the United Auto Workers were supposed to end tonight at midnight, but Ford has announced it will extend beyond the deadline. Detroit's big three say they need major changes from the United Auto Workers if they're to survive.

NPR's Frank Langfitt reports.

FRANK LANGFITT: Soaring health care costs and global competition; those two trends are at the heart of epic contract talks. Specifically, the companies are looking to get rid of about $100 billion in health care obligations, a crippling cost its key foreign competitors don't face. The U.S. companies are desperate to escape rising costs. They want to put money in a trust fund and let the union take on the burden of managing retiree health care.

David Cole chairs the Center for Automotive Research, a think tank in Ann Arbor. He says the stakes in the new contract are high.

Mr. DAVID COLE (Chairman, Center for Automotive Research): Historically, labor and management could negotiate, but there was never a question about the viability of the company. Well, today, that's not true. These companies are really in play.

LANGFITT: But it's not certain the union will back a health care trust fund. Workers at Ford and General Motors have already given up some health care benefits and are worried about more reductions. Cole says to win workers' support, union leaders could press the company to guarantee jobs.

Mr. COLE: New products built here in the United States - that would be an extremely important aspect for many of the workers to see new jobs here rather than jobs disappear somewhere else.

LANGFITT: Talks with all three car firms could go into the weekend, as they have in the past. Either way, no one expects a strike.

Frank Langfitt, NPR News. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Frank Langfitt is NPR's London correspondent. He covers the UK and Ireland, as well as stories elsewhere in Europe.