The Feds Aren't Nearly Done Investigating UAW Corruption

Former United Auto Workers president Gary Jones, who recently left the union following charges of corruption, in June of 2018.
Former United Auto Workers president Gary Jones, who recently left the union following charges of corruption, in June of 2018.
Photo: Bill Pugliano (Bill Pugliano / Getty Images)

More news for the United Auto Workers, both good and bad; phone-detection cameras are now on roads in the Australian state of New South Wales; Nissan’s new CEO plans to look into Renault ties; and Renault is working on a new CEO itself. All of this and more in The Morning Shift for Monday, Dec. 2, 2019.


1st Gear: The UAW Isn’t Out Of The Federal Spotlight Yet

The UAW has had lots of ups and downs over the past few months. The union has secured some contracts and is close to wrapping one up at Fiat Chrysler, but it’s also, as usual, full of troubling issues.

The latest comes from the Detroit News, which reported Sunday that U.S. Attorney Matthew Schneider said federal oversight of the UAW is still an option once government investigators find out just how deep the alleged corruption is.

We knew as of early November that the UAW wanted to avoid oversight by the federal government as a result of the corruption within it, with acting UAW president Rory Gamble saying the union needs to root out the corruption and keep it from coming back in.

Schneider gave the Detroit News the other side, saying federal oversight of the UAW “shouldn’t be taken off the table,” and that the union needs “significant reforms.” Schneider said in the story, though, that to push oversight would be “a little premature” right now, and that the government needs to work through the existing criminal cases before deciding how to proceed.

From the story:

In a rare interview about the years-long UAW scandal, Schneider said government oversight of the UAW is a possible solution to reforming a union plagued by what his team of prosecutors has called a culture of corruption among senior leadership. Prosecutors could seize control by filing a civil racketeering lawsuit, a move that could cost the union tens of millions of dollars, impose prolonged federal oversight and involve replacing labor leaders.

Schneider also revealed his displeasure with the UAW’s lack of cooperation, disclosed that a four-year investigation is perhaps only halfway completed, and said he was unimpressed with reform efforts announced in mid-November by acting UAW President Rory Gamble. His comments marked the first time Schneider has addressed the possibility of imposing federal oversight of the UAW, a move the government made 30 years ago in settling a racketeering lawsuit against the International Brotherhood of Teamsters.


2nd Gear: FCA, UAW Union Reach Tentative Agreement

Speaking of union stuff, there is some good news: the UAW announced Saturday that it has reached a tentative contract agreement for the next four years with Fiat Chrysler. It won’t comment on or provide details about the tentative agreement until it’s reviewed by council leaders from both sides.


The only detail the announcement did give was that the tentative agreement will include an extra $4.5 billion in investments, totaling $9 billion, which will add 7,900 new jobs during the contract period.

The UAW said the council will meet on Dec. 4 to look over details of the tentative agreement, and, if adopted, a ratification vote by hourly and salaried members at FCA will begin on Dec. 6.


Automotive News has a little more on what may be in the papers:

[Recent UAW deals at General Motors and Ford] include signing bonuses of at least $9,000, wage increases, no change to health care costs and a path for temporary employees to attain full-time status. [...]

Under the proposed deal, the UAW secured a signing a bonus of $9,000 with FCA, according to several media reports. FCA, which is adding factory capacity in the U.S. to expand the Jeep lineup, has also agreed not to close any plants and slot new product in an Illinois assembly plant, Bloomberg reported.


FCA also said it will give details of the tentative agreement at a later date.

3rd Gear: New South Wales Government Rolls Out Phone Detection Cameras On The Road

The Australian state of New South Wales has a new idea of how to keep people safer on the road, and that happens to be detection cameras for cellphones. Cameras rolled out on Sunday, Reuters reports, with transportation authorities hoping they’ll cut road fatalities by a third across two years.


Reuters reports that the detection program is one of the first in the world, and that the phone cameras will operate during the day, night, and in any weather conditions.

Artificial intelligence will determine whether drivers are using their phones, and those conclusions are then verified by personnel.


From the story:

“It’s a system to change the culture,” NSW Police Assistant Commissioner Michael Corboy told Australian media last week.

The Netherlands launched a similar system in October, fining drivers 240 euros ($265) for illegal use of mobile phones, according to a statement on a Dutch police website.

Making or receiving voice calls while driving in NSW is legal, but only when using a hands-free device. All other functions, such as video calling, using social media and photography, are illegal while behind the wheel.

So far this year 329 people have died on NSW roads, compared with 354 people for all of 2018, according to official statistics. The state wants to cut the number of road fatalities by 30% by 2021.


Reuters reports that during the first three months of the system, drivers caught on their phones will get warning letters. Once that period is up, the fine will be $234 at current exchange rates in normal conditions, and about $311 at current exchange rates in school zones. Penalty points will also be assessed.

4th Gear: New Nissan CEO Wants To Take A Closer Look At The Renault Relationship

Nissan has a new CEO in the post-Carlos Ghosn era, longtime Nissan-Renault-Mitsubishi alliance employee Makoto Uchida, and Uchida wants to look at the most obvious thing there is to look at when one takes over: the alliance.


Bloomberg reports that Uchida wants to evaluate what is working and what isn’t in the three-company alliance since he said it should benefit all of them.

And, while he said the partnership is “critical” to reach the companies’ goals, things need to change in order to benefit sales and earnings. Talks about capital ties between the companies, he said, haven’t happened yet.


From Bloomberg:

Ghosn led Nissan and Renault for years and held their two-decade partnership together until his arrest in November 2018 on allegations of financial misconduct, which he has denied. His downfall exposed governance shortfalls at Nissan and brought long-standing tensions between the automakers to the fore.

Uchida said the companies haven’t held discussions on changing the capital structure in the partnership, which has been at the heart of the tensions. A lopsided arrangement has given Renault more say, even as Nissan had outpaced the French partner in earnings in recent years. Renault owns 43% of Nissan with voting rights, while Nissan has a 15% stake in Renault, stripped of votes. Nissan also has a stake in Mitsubishi Motors, which Ghosn brought to the alliance in 2016.

Relations were further strained under Uchida’s predecessor, Hiroto Saikawa, when Nissan’s failure to back Renault’s plan to merge with Fiat Chrysler Automobiles NV effectively scuttled the transaction. Fiat Chrysler has since agreed to merge with Peugeot maker PSA Group instead.


So, basically, the Renault-Nissan-Mitsubishi alliance is perpetually going about as smoothly as your family Thanksgiving probably went, if you participate in all of that stuff. Fun!

5th Gear: Renault Gets Closer To Naming A New CEO

On the topic of Renault and Nissan, the French automaker may be close to naming a new CEO of its own after former CEO Thierry Bolloré’s tenure ended “with immediate effect” after a meeting with the company’s board of directors in October.


It was yet another management shakeup in the post-Ghosn era, and Renault announced executive Clotilde Delbos as taking over in the interim while reports added that she was said to be in the running for the permanent CEO position.

Now, a couple of months later, Reuters reports that Renault chairman Jean-Dominique Senard said on Monday that the company is “close to finalizing the shortlist” for the CEO position, and could have the shortlist done before the end of the year. From the story:

Senard told reporters on the sidelines of a French carmaker conference that the shortlist would be finished “in a very short space of time”.

Renault ousted former chief executive Thierry Bollore in October, with Renault and its Japanese partner Nissan (7201.T) trying to rekindle their relationship after the arrest of the Renault-Nissan alliance’s former head Carlos Ghosn.


We’ll see whom the list produces one of these days, it looks like.

Reverse: Ford Debuts The Model A

Ford debuted the new Model A on Dec. 2, 1927, according to United Press International. At the time, the story said, a Model A roadster was $395.


Neutral: Will Phone-Detection Cameras On The Road Change The Culture?

Do you want to see this in your country?



Neutral: If they are like every other automated system on US public roads and are operated by a non-governmental 3rd party, then no. It may work elsewhere, but here in the US they’ll turn into a money making scheme like speed traps and red light cameras.