Wednesday, August 26, 2015

Credit Where It Is Due

Happy days are here again in Oshkosh!  The city's largest employer--the Oshkosh Corporation--lands the largest military contract in its history--$6.7 billion dollars to build the replacement vehicle for the Humvee.  When you add in the service, parts and possible extensions, the deal could be worth $30 billion by 2040.  To fill that order, Oshkosh Defense will have to hire hundreds of new employees--along with those that will be added to the payrolls at the regional suppliers that contract with Oshkosh.  It's the kind of economic development that could lift the entire region for a generation.

A great deal of credit must go to the United Auto Workers members who a few years ago agreed to take concessions in their new contract with the company in order to make the Oshkosh Defense bid as competitive as possible.  Oshkosh was in fierce competition with AM General--which built the original Humvees that the new Joint Light Tactical Vehicle will replace--and Lockheed Martin--a manufacturer providing the Pentagon with a myriad of fighting machines that are used on both the ground and in the sky.

There were stories that the other bidders were questioning the ability of Oshkosh Defense to build the JLTV's at the prices the company was quoting.  But Oshkosh was able to show the Pentagon the union contracts already in place--guaranteeing the labor costs for the bid.  Ultimately, the Department of Defense decided that Oshkosh and its workers were going to provide the best vehicle that $250-thousand dollars a piece can buy.

It would have been very easy for the UAW members to reject the idea of pay freezes and higher health insurance premiums and deductibles requested by the company at the start of the bid process.  There were plenty of community leaders who claimed it was another case of an "evil corporation" taking advantage of a "concocted crisis" to "artificially depress wages".  Well, where would those workers be now if AM General had landed this $6.7 billion contract?  They would likely be heading to Indiana to work at that production plant--while the "community leaders" would be standing there with their blue fists in the air.  And those who remain would have to hope that broke European governments start minting more Euros so that they can order garbage trucks again.

Instead those employees who were willing to take a little less are guaranteed of jobs for as long as 25 years.  And all of the other businesses in town that will sell food, cars, houses, appliances and pet treats to those workers get to share in the wealth as well.  So I think the next time you see an Oshkosh Corporation production worker you should give them a hearty handshake and both congratulate them and thank them for the teamwork they exhibited to allow so many of us to win.

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