Fiat Chrysler, UAW reach new tentative labor deal

UAW Fiat Chrysler

The full details of the agreement remain unknown, but, according to the union, it is similar to those concluded with GM and Ford.

The heads of UAW local chapters are to meet Wednesday to review the tentative agreement and decide whether to recommend it to members.

The United Auto Workers has reached a tentative agreement on a new labor pact with Fiat Chrysler Automobiles N.V., completing what has been a hard round of negotiations that took almost five months to complete amid a scandal that claimed more than a dozen UAW executives, including the union's president and another of its top officers.

"In addition to the $4.5 billion in major investments previously announced, negotiators secured an additional $4.5 billion for a total of $9 billion of investments adding 7,900 jobs during the contract period".

Fiat Chrysler confirmed the agreement in a statement but did not provide additional details on the outlines of the deal.

Workers are expected to ratify the contract, though the vote could be complicated by allegations of corruption that have roiled the union in recent weeks. Permanent GM workers also got $11,000 ratification bonuses, although that was tempered by the cost of the strike.

Boston Partners trimmed its holdings in shares of Fiat Chrysler Automobiles NV (NYSE:FCAU) by 5.1% in the third quarter, reports. The larger of the automakers contends Fiat Chrysler's former CEO, the late Sergio Marchionne, used bribes and other means to get favorable, albeit illegal, settlements with the union that made it more hard for GM to remain competitive. Following the same deal would cost Fiat Chrysler more because the makeup of its workforce is different.

Top union leaders still have to approve the deal, as do factory-level officials who are likely to gather next week to vote on it. Ford agreed to $9,000 ratification bonuses, however previous contracts have included lower amounts for Fiat Chrysler workers.

In the end, GM agreed to give many of those temporary employees a path to job security while also boosting pay and benefits for second-tier UAW members. Last month, Fiat Chrysler announced plans to merge with France's PSA, which will create the world's fourth-largest auto company worth $50 billion.

UAW leadership will have trust issues to overcome in the voting process.

Union President Gary Jones, whose home was raided by federal agents and is implicated in the scandal, resigned from the union last week.

GM hit Fiat Chrysler with a stunning racketeering lawsuit earlier this month, alleging the Italian-American automaker inflicted billions of dollars in damages by bribing union officers for competitive advantages.

Corrects that deal includes a promise that no assembly factories will be closed under the agreement, rather than no factories at all.



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