UAW and Detroit 3 Contract Talks Hit Unexpected Bump

You’d think that after more than 20 years on the job and facing a summer and fall of intense and potentially explosive labor negotiations that Fiat Chrysler Automobile’s longtime North American employee relations chief Al Iacobelli would be too valuable to lose.

But on Tuesday morning, Iacobelli announced his immediate resignation. Iacobelli is only 55, has been a point man for the company since 1993 and obviously knows his way around a negotiating table.

He was there in 2007 to help usher in the era of two-tiered wages for autoworkers. He was also bargaining with the United Auto Workers when Chrysler went bankrupt in 2009. According to Automotive News:

“He led company negotiations in 2011 between the UAW and Chrysler Group in 2011, which many analysts believe achieved the most favorable labor contract among the Detroit 3.”

So Fiat Chrysler is not dumping dead weight. Pundits agree that such a move with contract talks just weeks away is unheard of. Fiat Chrysler has lost a key ally who knows the players, understands the landscape and knows what’s at stake.

Or, maybe it’s just this simple: In a post-bankruptcy economy where automakers are breaking all kinds of sales records, Iacobelli sees the writing on the assembly plant wall.

These talks are going to get ugly. Real ugly. And he’s just plain over it.

The two-tier wage system remains a huge point of contention among the 140,000 members of the UAW. Dumping it will not be as easy as its implementation eight years ago when the industry was on the brink of disaster.

And the sabre-rattling that started rather benign late last year has grown more contentious. UAW boss Dennis Williams told UAW delegates during a rally in March that, “We’ve got too many damn tiers,” and auto workers sacrificed during the recession and now must get that compensation back.

Now, it’s not like Fiat Chrysler head Sergio Marchionne has called on some fresh-faced newcomer to fill in for Iacobelli. Glenn Shagena, who has been with the Fiat Chrysler since 1985, is replacing him. The 30-year veteran, who is 52, is formerly head of human resources for the company in Mexico. Shagena has been involved in labor relations at the company as an HR director and has worked on past negotiations. As savvy and knowledgeable as Shagena may be, this is one tall order to fill.

And watching a 20-plus year company veteran who has been a key player in contract talks through some of the industry’s stormiest times can’t sit well with either side. All they can do now is watch as Iacobelli grabs his gold watch, packs up the Grand Caravan and drives off into the golden years.