Tennessee Volkswagen plant workers reject UAW bid to unionize

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CHATTANOOGA, Tenn. -- Workers at a Volkswagen factory in Tennessee have rejected the United Auto Workers union.

The 712-to-626 vote is a devastating blow to the union and its bid to organize other Southern plants run by foreign firms.

About 1,500 workers were eligible to vote over three days of balloting that ended Friday night.

Experts say it was the best chance for the union to gain a foothold in the South, where it's been shunned by other workers.

Volkswagen tacitly endorsed the union and even allowed organizers into the plant to make their sales pitch.

"If they can't win this one, what can they win?" asked former General Motors labor negotiator Art Schwartz, now a consultant in Ann Arbor, Mich.

UAW president Bob King, in a 2011 speech to workers, had said the union has no long-term future if it couldn't organize the Southern plants. But Mr. King stuck to statements he had made earlier that the union would seek a vote and respect any decision made by workers.

"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," Mr. King said in a statement.

Anti-union groups had warned that a vote for the UAW could bring a fate similar to Detroit, with rising costs leading to shuttered factories. Republican politicians volunteered their concerns that the union would make the region less competitive for manufacturing jobs. Some have said a union would jeopardize incentives Tennessee has offered VW to build a new SUV at the plant.

The union had said, however, that workers needed a voice in how the plant is run. Officials noted that Detroit workers have benefited from having a union, getting big profit-sharing checks under contracts that tie their pay to company earnings.

A UAW win would have given the union its first foothold at a Southern plant owned by a foreign automaker, but was no guarantee that other so-called transplant companies, with a dozen or so assembly plants in the South, would have followed.

But the Chattanooga loss will be devastating. The union had staked its future on being able to organize Southern plants and bring wages closer to UAW-represented factories in the North.

Volkswagen officially stayed neutral on the UAW, but it let union organizers inside the plant to give sales pitches. Labor interests make up half of the VW supervisory board in Wolfsburg, Germany, and they had asked why the Chattanooga plant was the only one without formal worker representation.

VW had said it wanted a German-style "works council" in Tennessee to give employees a say in working conditions. But it said U.S. law wouldn't allow that without an independent union.

German automakers Daimler AG, which has a Mercedes-Benz factory near Tuscaloosa, Ala., and BMW AG, with an SUV plant in Greer, S.C., have unions and works councils representing employees at their home factories. Their U.S. plants likely would have been the UAW's next targets, although those companies haven't welcomed the UAW as Volkswagen did.

Organizing efforts at Japanese automakers' plants would be still more difficult than at the German-run factories. Workers at Nissan, Honda and Toyota have rejected the UAW in the past.

The union once was a huge political and social force in the United States; it had 1.5 million members in 1979. But membership eroded and now stands at around 383,000, up slightly from the Great Recession.

Even had it won in Chattanooga, the UAW still faced hurdles: Under Tennessee's right-to-work labor laws, workers could still refuse to join, reducing dues collected and giving the union less clout at bargaining time.

The UAW loss becomes a huge setback for the U.S. organized labor movement because it remains quarantined mainly in northern states, where it is well-established but where the manufacturing base is shrinking.


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