Fiat Chrysler and union reach tentative contract deal in US

Daniel Fowler
December 2, 2019

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

Union Auto Workers also confirmed that it has reached a tentative agreement with the Italian automaker.

Fiat Chrysler and the United Auto Workers union have reached a provisional employment contract calling for billions in new investments and thousands of new jobs, the UAW reported Saturday.

She said the agreement called for an additional $ 4.5 billion investment by FCA, which is expected to lead to the creation of 7,900 jobs.

Fiat Chrysler agreed not to close assembly plants during the life of the contract and to invest in its factory in Belvidere, Illinois, that makes Jeep Cherokee SUVs and employs nearly 3,700 hourly workers, people familiar with the talks said earlier. GM settled October 31 after a bitter 40-day strike that paralyzed the company's US factories, but Ford reached a deal quickly and settled in mid-November. The vote is expected to take about two weeks. Fiat Chrysler Automobiles earned a coverage optimism score of -1.23 on their scale.

Fiat Chrysler Automobiles (FCA) is the last of the three major Detroit vehicle manufacturers who in principle reach agreement with the powerful union.

Of the $9 billion in total investments included in the deal, half were newly announced Saturday, and the other $4.5 billion are investments announced earlier this year. Permanent Ford workers qualified for $9,000 bonuses. If adopted as a Tentative Agreement, it will go to all FCA hourly and salary members for a ratification vote that will begin on December 6, 2019, a UAW spokesman said.

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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.

General Motors last week filed a federal racketeering lawsuit against FCA, alleging that the company bribed UAW officials to get more favorable contract terms than GM. Fiat Chrysler said in a press release that GM's lawsuit was "without merit" and dismissed it as an attempt to disrupt its recent agreement to merge with French automaker Groupe PSA - a merger which if finalized, would make the combined company the fourth largest carmaker in the world by production volume.

It's not clear if or how the various issues facing FCA and the UAW impacted the final settlement.

On top of that, bargainers knew they would face even more scrutiny than normal in the wake of an ongoing bribery scandal that has seen a number of union and company executives arrested, a dozen so far pleading guilty.

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

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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