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UAW says it has accord with Chrysler, Fiat , U.S.

UAW says it has accord with Chrysler, Fiat , U.S.

Canadian workers vote 87% in favor of their deal

David Barkholz

Automotive News | April 26, 2009 – 8:31 pm EST


The UAW said it reached a labor agreement with Chrysler LLC, Fiat S.p.A. and the U.S. Treasury Department.

The deal will alter Chrysler’s financial obligations to the union’s retiree health-care plan, a concession that could allow the automaker to avoid bankruptcy.

The accord will also help Chrysler meet a Thursday U.S. deadline for forging an alliance with Fiat to qualify for additional rescue loans. Chrysler, surviving on $4 billion in U.S. aid, is still negotiating with its creditors.

"We recognize this has been a long ordeal for active and retired auto workers, and a time of great uncertainty," said UAW President Ron Gettelfinger in a statement. "The patience, resolve and determination of UAW members in these difficult times is extraordinary, and has made it possible for us to reach the agreement."

The union said workers must ratify the deal by Wednesday. No details were offered.

Like the agreement with the Canadian Auto Workers announced Friday and ratified today, the UAW concessions don’t include a wage cut, said a source familiar with the talks. The union has agreed to additional concessions to the $10.6 billion retiree health-care trust, or Voluntary Employee Beneficiary Association, that Chrysler had proposed funding half with equity and half with cash, the source said.

The UAW concessions are at least as deep as those settled by the CAW, the source said. Those CAW savings were pegged at about C$240 million ($198 million) annually. The CAW’s givebacks include additional break time, a vehicle purchasing discount and tuition reimbursement.

The CAW said its members voted 87 percent in favor of their new collective agreement with Chrysler.

The union made the concessions in order to try to help the company qualify for government aid in Canada.

"Our members understand better than anyone the current turmoil of the domestic auto industry," said CAW President Ken Lewenza.

"The high acceptance of this agreement is a recognition that although workers did not cause this crisis, we all have an interest in maintaining good jobs and ensuring the auto industry remains central to the overall Canadian economy."

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