Chrysler and UAW Reach Tentative Labor Agreement
Chrysler Group LLC and the United Auto Workers union have reached a tentative labor agreement that the union says will create 2,100 jobs. The proposed 4-year contract has Chrysler promising to invest $4.5 billion to produce new models and upgraded vehicles and components through 2015, necessitating the creation of new positions.
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The UAW has already reached deals with both Ford (NYSE:F) and General Motors (NYSE:GM), which combined should create or retain about 12,000 jobs that would otherwise have been moved to plants in Mexico or overseas. Additionally, Ford previously announced plans to add 7,000 jobs in the U.S.
“This tentative agreement [with Chrysler] builds on the momentum of job creation and our efforts to rebuild America…to communities left in turmoil in the wake of the country’s economic collapse,” said UAW President Bob King.
Contract negotiations with Chrysler took longer than with the other two Detroit-area automakers because Sergio Marchionne, CEO of both Chrysler and Italian automaker Fiat, argued that the company couldn’t afford to match the deals made between the union and its bigger U.S. rivals.
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Neither the union nor Chrysler have released any further details about the tentative labor agreement covering 26,000 workers. The deal still needs to be ratified by Chrysler’s UAW members in order for it to take effect. GM workers have already ratified their deal, but only 50.1% of production workers at Ford have approved the new contract, while only 45.2% of skilled trades workers have approved the deal.