Union Reaches Tentative Deal With Chrysler
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DETROIT — The United Auto Workers union reached a tentative four-year contract with Chrysler yesterday, hours after going on strike and the same day General Motors workers ratified a separate four-year pact. Next up: Ford.
A person with knowledge of the Chrysler LLC agreement said it includes some guarantees that vehicles will be produced at American factories, a company-funded union-run trust that will pay much of Chrysler’s $18 billion in long-term retiree health care costs, and a lower wage scale for some newly hired workers.
The person, who requested anonymity because the contract has not been ratified by union members, said the new vehicle guarantees are not as extensive as those given by General Motors Corp.
The guarantees, which translate into job security for union workers, are in many cases only for the life of current products, the person said. GM made guarantees at many factories that include the next generation of cars, trucks, and parts.
The new lower wage scale, the person said, covers new hires who would replace Chrysler Mopar parts transportation workers. Buyout and early retirement offers would be made to current workers in an effort to get them to leave, the person said.
The lower wage scale is similar to the one negotiated by GM, the person said.
UAW’s president, Ron Gettelfinger, said the strike against Chrysler, which is 80.1% owned by private equity firm Cerberus Capital Management LP, would end immediately and workers should report for their next available shift.
“This agreement was made possible because UAW workers made it clear to Chrysler that we needed an agreement that rewards the contributions they have made to the success of this company,” Mr. Gettelfinger said in a statement. Mr. Gettelfinger wouldn’t release any details of the contract, but Chrysler said the tentative agreement includes the retiree health care trust. The newly private company didn’t say how much money it will contribute to the trust.
Chrysler’s national UAW contract covers about 45,000 workers and 78,000 retirees and spouses.
