The folks that are going to buy Chrysler–the private equity firm of Cerberus Capital Management–are working hard to reassure the UAW and rank-and-file workers that a bunch of workers are not heading for the unemployment line. I’m skeptical–mainly for the long haul.

The Wall Street Journal has this today (subscription only):

 

Leaders of the soon-to-be-independent Chrysler Group and its private-equity buyers began a campaign to win support from rank-and-file workers and union leaders. But results from German parent DaimlerChrysler AG, which included a €1.49 billion ($2.02 billion) operating loss from Chrysler, underscored the big challenges they face in turning around its operations.

 

Cerberus Capital Management LP founder Stephen Feinberg met yesterday with leaders of Chrysler’s two main unions in an effort to ease labor worries about Cerberus’ planned acquisition of 80.1% of Chrysler, announced Monday.

 

But the most revealing part of the story perhaps is this:

 

Mr. Feinberg offered assurances it plans no immediate job cuts beyond 13,000 previously proposed by the company. That won praise from one key labor leader, Canadian Auto Workers union leader Buzz Hargrove, who previously had expressed opposition to a private-equity takeover.

 

Mr. Hargrove said Cerberus committed to not cutting additional hourly jobs in Canada until at least September 2008, when the current CAW contract with Chrysler expires. Mr. Hargrove said Cerberus committed to not making cuts in United Auto Worker positions beyond those already announced in February.

I would put the emphasis on the words “no immediate” and “until at least September.” Does anyone doubt that those guys will come in with a sharp sword and slash deeply if they aren’t seeing the profits they expect?

The New York Times has a piece reinforcing yesterday’s reporting that UAW president (my president) Ron Gettelfinger is playing the hand dealt him:

 

“O.K., I’m going to go over this one last time,” he said, interrupting a questioner. “The status quo was off the table. Cerberus was the only company that we discussed” with DaimlerChrysler’s chief executive, Dieter Zetsche, at a four-hour meeting in Stuttgart, Germany, on Saturday.

 

Mr. Gettelfinger added, “The decision was made before we ever got there” that the meeting would focus only on the Cerberus bid. Given that, he said, the union saw little choice but to support it.

 

We will see what happens as this unfolds. But, I remain very uneasy.