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The Detroit News:

Chrysler LLC was determined to protect its leeway to rework its product lineup and plan a future in private, which is why it refused to grant the United Auto Workers long-term product commitments like those promised by General Motors Corp., sources close to negotiations said Tuesday.
Many workers were holding out hope that Chrysler would match GM's strategy of promising that factories would get work building specific cars and trucks well beyond the contract's 2011 expiration. The lack of such commitments in the Chrysler contract could be a sticking point when the company's 45,000 rank and file vote on the contract in coming days.

But the smallest of Detroit's Big Three has a strategic direction that's still evolving and a model lineup that could change dramatically under new owners and a new management team.
Industry watchers say that despite the risk of losing support from workers, holding back on commitments will give newly private Chrysler the flexibility it needs to have a shot at reviving its flagging U.S. operations.

"Chrysler can't make the same commitments because their product portfolio is in a state of flux," said Erich Merkle, vice president of forecasting at Grand Rapids-based IRN Inc. "It's very difficult to keep all those plants open because they are not fully utilized."

Chrysler's tentative contract with the UAW includes up to $15 billion in product commitments for its U.S. factories. The company says 94 percent of its UAW-represented facilities, from assembly plants to parts centers, are promised work through the four-year life of the contract.

But unlike the GM deal, virtually no promises stretch beyond the four-year life of the contract and few specific vehicles are named.

Chrysler didn't want the contract to include product commitments in large part because it doesn't want to reveal its future lineup, information it considers highly competitive, the sources said. GM was shocked when the UAW released a commitment list that made public years of product planning.

In addition, Chrysler's assembly lines are flexible, which means they can produce different models, and the company doesn't want to lock itself into product commitments many years down the line.

Major changes to come

Big changes could be on the way for the automaker, which has seen its U.S. sales fall 3 percent this year through September.

Chrysler Vice Chairman Jim Press, the company's new top product strategist and former Toyota Motor Co. executive, told The Detroit News last month Chrysler's lineup needs adjustments.

"There are some products that may go away, and there are probably some products that we need to add," he said.

While Press declined to identify specific vehicles, he said some of Chrysler's cars and light trucks "are sort of overlapping the same segments" and need to be differentiated.

Press' influence at Chrysler also could lead the automaker to consolidate some of its many platforms, said Tom Libby, senior director of industry analyst at Power Information Network, a division of J.D. Power and Associates.

"Toyota is a master at having the same platform for vehicles which have no visual similarities," Libby said.

Chrysler's goal of strengthening its international portfolio also likely led it to keep open its options in the United States, Libby said.

"They need to make alliances with other automakers so they can expand into Europe and Asia and to expand their offerings in North America," he said. "As those international negotiations are taking place, they can't make long-term commitments."

Workers are worried

Already, union dissidents are using the lack of long-term commitments as a rallying cry against the deal.

"Virtually no Chrysler plant received commitment beyond the scope of the current product," wrote Bill Parker, a local president and frequent UAW critic who sat on the bargaining team, in letter posted to a dissident Web site. "This is far more significant than it may sound."

From the few details he's received so far, Chrysler worker Austin Young said the lack of plant commitments from Chrysler worry him.

"It's always a concern when a company you are working for doesn't want to commit to you as an employee," said Young, an assembler at Trenton Engine. "We've been asked to give up a lot of things and that door should swing both ways."

Sources close to negotiations at GM said the product commitments were a key factor in getting UAW President Ron Gettelfinger to sign off on a deal after the union launched a two-day national strike against the automaker. GM's rank-and-file workers ratified the deal by a two-thirds majority in a vote finalized on Oct. 10.

Chrysler is in a different position than GM, and many workers are aware of the company's challenges, said labor expert Harley Shaiken of the University of California, Berkeley.

"The UAW leadership is essentially indicating this is the best it can be done under difficult circumstances," he said. "At Chrysler, you have a much more uncertain environment."

Worker Gary Betway counts himself among the pragmatists.

"I don't see how any company can guarantee anyone, any jobs," said Betway, who works at the Trenton plant. "I'm sure GM intends to keep their promises, but if the industry falls through the floor, they'll ask to renegotiate the contract."