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A generation of Detroit autoworkers hired in the 1970s is approaching retirement age just as the ... Michigan autoworkers seeki
A generation of Detroit autoworkers hired in the 1970s is approaching retirement age just as the manufacturing empires built by General Motors Corp. and Ford Motor Co. are unraveling.
This confluence has prompted autoworkers such as Bruce King to yearn for a buyout offer that would allow them to walk away now from an industry where they see disarray and little future.
"I'd take an early retirement in a heartbeat," said King, 50, who has worked as a paint repairman at the Ford assembly plant in Wixom, Mich., for 28 years. "For guys who can't quite retire yet, all they think about is, 'Boy, give me a chance to get out of here.' "
King's eagerness to leave the assembly line took on new urgency when Ford said Monday that his plant would close by 2007 as the company eliminates as many as 30,000 factory jobs in the next six years. One-third of those cuts, along with three-quarters of the 4,000 white-collar jobs Ford plans to cut by March, will occur in Michigan, said Sean McAlinden, an analyst with the Center for Automotive Research in Ann Arbor. The state's economy will contract as it tries to wean itself from unskilled assembly-line jobs on which it has depended for a century, McAlinden said.
"As Ford gets smaller, Michigan will get smaller," McAlinden said. "One hundred thousand people left the state in the last two years, and this will accelerate in the wake of Monday's announcement."
Gov. Jennifer Granholm said Michigan could not depend on unskilled workers making parts such as fan belts in the future. Granholm said the state's workers have unsurpassed skills for programming and maintaining the robots that will assemble cars.
Joe Laymon, Ford's group vice president for human resources, said the company would begin negotiations on early retirements. Steve Stamper, president of UAW Local 600 at a Ford plastic-bumper factory in Milan, Mich., said the union favored the idea in principle.
Ford took the Milan plant back in October from its former parts unit, Visteon Corp. At the time, Ford offered to let workers with 28 years or more of service stay home with 80 percent of their pay until they qualify for a full pension on their 30th anniversary. Of 150 workers who qualified at Milan, 90 retired early, Stamper said.
Demographics helped drive this response. The average age of U.S. blue-collar workers is 47.5 years at Ford and 48.5 at GM, McAlinden said. Half of GM's blue-collar workers in the U.S. will be eligible to retire by 2007 with 30 years of service.
To encourage retirements, GM and Ford use programs tailored to individual plants. Some workers who receive $35,000 bonuses to retire early still get health-care and 30-and-out pension payments of $2,950 a month. Others who receive $100,000 bonuses must renounce all further health-insurance and pension claims on the companies.
Earlier this month, Ford began offering four years of college tuition, plus half pay and full medical benefits, to workers at a plant the automaker closed in 2004. Under the terms, workers must renounce additional claims, spokeswoman Marcey Evans said.
When King joined Ford in 1977, the Wixom plant was the center of the automaker's luxury-car production, and he worked 10 hours each day and two Saturdays a month. Employment at Wixom dwindled during that time by 55 percent, to 1,800, and King's Christmas holiday was extended until Monday because of slow sales.
At a prototype assembly factory in Dearborn, workers would line up to retire if Ford offered $50,000 plus a pension and health care, said Bill Guido, a 32-year veteran in the material control department.
At a DaimlerChrysler AG stamping plant in Warren, Mich., nobody is leaving because, for the first time in four years, the company is not offering early-retirement bonuses, said Paul Thayer, 43, a welder repairman with 13 years experience.
To meet its latest job-cutting goals, Ford might have to go beyond anything it has done so far and match the offer of $70,000 plus a pension and health care that Chrysler used to eliminate 20,000 jobs in 2001, McAlinden said.
GM and Ford might have trouble persuading some workers to leave because of anxiety over increases in out-of-pocket health expenses for retirees, McAlinden says. The companies agreed last year that UAW retirees will pay as much as $752 a year for each family for medical coverage. Before, they had no out-of-pocket expenses.
Tony Trent, 47, is a 29-year veteran at the GM engine plant in Romulus, Mich. He helps install filters and hoses just before the engines leave the plant.
He estimated that two-thirds of the 24 workers in his department would become eligible for retirement between now and August. He predicted that most of those eligible will not retire because they were afraid GM would cut back on health care and pensions after they were gone.
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