DETROIT, Sept. 3 — Detroit’s traditional Labor Day parade took place on Woodward Avenue on Monday with the biggest questions in contract negotiations between the United Automobile Workers union and the Detroit automakers yet to be answered, less than two weeks before the pacts expire.
One question is whether the U.A.W. will agree to the health care overhaul sought by the carmakers — and its corollary is how much General Motors, Ford Motor and Chrysler will be willing to pay to make that happen.
Contracts expire at midnight on Sept. 14, so talks are expected to pick up this week and accelerate toward the deadline. For now, however, the ball is in the U.A.W.’s court, according to people with direct knowledge of the negotiations.
The union, they said, must signal that it is willing to discuss the creation of a giant health care trust, which it would administer and which would provide benefits for active and retired workers.
Creation of the trust, a voluntary employees’ beneficiary association, would take up to $100 billion in health care liabilities off the automakers’ books. In return, the companies would contribute tens of millions of dollars to create the trust.
Given the complexity of transferring responsibility for health care from company hands to the union’s, some analysts predict it will be handled in stages. That would give the U.A.W. time to get used to administering the trust and would allow the struggling carmakers to pay for it over the next few years rather than all at once.
The U.A.W. is being advised in the matter by a financial consultant, Lazard, which it has used in past negotiations on health care. It also is seeking help from consulting firms that specialize in health care matters, these people said.
If the union rejects the idea of creating a trust to shift the burden for health care, the companies are likely to ask for significant concessions in other aspects of the contract, including wages, benefits and work rules, said these people, who asked not to be identified because the talks were supposed to be private.
On Monday, the U.A.W.’s president, Ron Gettelfinger, marched with union members but did not address a rally held at the end of the parade. “This is an opportunity to come together as working men and women,” he said as he left the parade, according to The Associated Press. “Negotiations are best done if they’re handled at the bargaining table, not in the media.”
Union workers are awaiting the outcome with little guidance from their leaders. Mark and Dawn Lemerand, who both work at Chrysler’s truck plant in Warren, Mich., said they had spent as little money as possible in recent months, fearing that the new contract could lower wages, make health care more expensive and reduce job security.
“Life’s been on hold. We’re saving every dime we can,” said Mrs. Lemerand, 38, who joined thousands of union workers at the parade. The crowd included not only automotive workers but also bus drivers and tuxedo-clad members of the Detroit Symphony Orchestra, who were at an impasse in their own contract talks.
Mrs. Lemerand and her colleagues at U.A.W. Local 140, who build the Dodge Ram and Dakota trucks, wore green T-shirts warning, “Will strike if provoked.” Late last month, a number of U.A.W. local chapters voted to authorize a strike if talks broke down, a common move aimed at giving union leaders more leverage. At her local, 98 percent voted in favor of authorizing a strike, she said.
But industry experts say there is almost no possibility of a strike, as the car companies are in such fragile financial shape that a shutdown could force at least one of them into bankruptcy.
“It would be really remarkable if there was a strike. You’d need a complete collapse of negotiations,” said David L. Gregory, a professor of labor law at St. John’s University in Queens. “A strike this time around could be absolutely lethal for the company being struck.”
But more than a month after negotiations opened in mid-July, U.A.W. members say they have heard almost nothing from their negotiators. Unlike in past contract talks, the union does not have a toll-free number for chapter presidents to call for updates to pass along to members, nor have negotiators faxed or sent by e-mail any material to print in local newsletters or post on Web sites.
“It’s been very quiet,” said Jim Stoufer, president of Local 249, which represents workers at the Ford assembly plant in Kansas City, Mo. “We seem to be a little more in the dark than normal, and I think it’s because of the tough times.”
The lack of news is not necessarily a sign that talks are at a standstill, though, said Professor Gregory: “If there was a meltdown, we’d have heard about it.”
Sean McAlinden, a labor economist with the nonprofit Center for Automotive Research in Ann Arbor, Mich., said he expected the carmakers to offer workers one-time “signing bonuses” in exchange for long-term wage and benefit reductions to increase the likelihood of ratification.
A similar bonus was offered at the bankrupt Delphi, the country’s largest parts maker, whose workers approved cuts this year.
Officials from the carmakers declined to comment.
Mr. Stoufer said he had heard rumors about wage cuts of 20 to 30 percent for U.A.W. members, who earn about $29 an hour on average. But Ralph Mayer, president of U.A.W. Local 898 in Ypsilanti, Mich., said, “I’d put money on the fact that a huge pay cut is not going to happen.”
The proposal to create a union-run health care trust seems particularly unsettling to many workers. A U.A.W. faction that opposes concessions has distributed fliers that equate the voluntary employees’ beneficiary association proposal, known as V.E.B.A., with “Vandalizing Employee Benefits Again.”
Workers at G.M. and Ford agreed in 2005 to pay part of their medical costs. Workers at Chrysler did not make a similar deal, so analysts say the U.A.W. may have to grant the company’s request for similar cuts in medical costs as part of any overall package.
In past years, the U.A.W. has chosen one of the car companies as its negotiating target around Labor Day. The union’s pattern-bargaining philosophy involved reaching a deal with the target company, then persuading the other two carmakers to accept similar terms.
But in the 2003 talks, the union did not choose a target, instead conducting talks simultaneously with all three. There has been no word on which company may be chosen this year, although Mr. Gettelfinger has said he is striving for a pattern agreement.
If a target is chosen, experts say, G.M. stands the best chance, because it is healthier than Ford and the most intent on creating a V.E.B.A. fund, given that its future medical costs are estimated at about $55 billion. But Ford could be selected because Mr. Gettelfinger, who came up through the Ford ranks, has the longest-standing relationships there.
Chrysler, which was sold to Cerberus Capital Management last month, seems to be the least likely target, since it has new owners and must still resolve its health care situation, experts say.