Union approves new contract with Chrysler

DETROIT — Members of the United Auto Workers union approved a new four-year labor contract with Chrysler on Wednesday, though many voted against the pact.

The approval means that all three Detroit automakers have signed deals with the union and labor peace is likely at least through September of 2015.

The contracts, reached without strikes or arbitration, should help the union in its efforts to organize workers at U.S. factories owned by foreign automakers, UAW President Bob King said. The UAW has made progress with the companies in confidential discussions, he said, but he would not identify which company the UAW will focus on first.

Overall, about 55 percent of workers casting ballots voted for the contract with Chrysler and 45 percent opposed it.

Salaried and production workers across the U.S. voted in favor of the deal, but skilled trades workers such as electricians and pipe fitters voted it down. So under the union's Constitution, the executive board made the final decision to ratify the pact.

Under the deals, most workers at Chrysler, Ford and General Motors won't get pay raises. But they'll get signing bonuses, profit sharing and other payments. The deals also promise at least 13,000 new jobs at all three companies and give raises to a small number of entry-level workers who make about half the pay of a longtime UAW member.

About 56 percent of skilled trades workers voted against the contract, forcing the executive board to meet by teleconference. The board declared the contract ratified after determining that skilled trades workers voted the deal down mainly for economic reasons that weren't unique to their jobs.

The union and Chrysler reached a tentative agreement on the new contract Oct. 12, and Chrysler Group LLC's 26,000 workers finished voting on the deal Tuesday night.

The Chrysler deal includes a $3,500 signing bonus, and its profit-sharing checks are far lower than workers will get at Ford Motor Co. and General Motors Co. Ford's signing bonus is $6,000, while GM's is $5,000. Chrysler Group LLC has yet to make a full-year profit since it emerged from bankruptcy protection in 2009, while GM and Ford have each made billions.

Chrysler workers were barred from striking over wages under the terms of the company's 2009 government bailout.

Chrysler hasn't made an annual profit since 2005. The company earned $116 million in the first quarter, its first quarterly net profit in five years. But it lost $370 million in the second quarter, mostly because of charges for refinancing government debt. The company is likely to announce a third-quarter profit when it reports earnings on Friday.

Chrysler expects to earn $200 million to $500 million this year, excluding the debt charges. But the profit is tiny compared with its Detroit rivals. Ford reported a profit of $6.6 billion last year, while GM earned $4.7 billion.

The Chrysler deal promises up to 2,100 new jobs and investment of $4.5 billion in U.S. factories.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Ford's union workers ratify new contract

Union workers at Ford Motor Co. overcame early opposition to a new four-year contract with the company and overwhelmingly approved the deal in voting that lasted two weeks.

More than 26,000 workers, or 63 percent of those who cast ballots, voted in favor of the pact, while almost 15,000, or 37 percent, opposed it, the UAW said in a statement Wednesday.

The vote means that new contracts have been approved at Ford and General Motors Co., with Chrysler workers just starting to vote on their deal. At all three companies, the union agreed to profit sharing and signing bonuses instead of annual pay raises, a novel concept that helps the companies control their costs yet rewards workers.

The contracts set the wages and benefits for 112,000 auto workers nationwide, and also influence the pay at auto plants owned by foreign companies, auto parts supply companies and other industries.

As part of the deal at Ford, the company promised $4.8 billion in new investments in its U.S. plants and 5,750 new jobs.

Most workers won't get annual raises under the contract, but they will get profit-sharing checks, inflation adjustment payments and other bonuses worth at least $16,700 through 2015. The deal at GM was similar, but the Chrysler pact has far smaller signing bonuses and profit-sharing checks.

UAW Vice President Jimmy Settles, the union's top Ford negotiator, said in a statement that workers at Ford were frustrated with the economy, a lack of pay increases and what he called "outrageous" pay packages for executives, yet they still approved the pact. Eighty-five percent of the union's members at Ford cast ballots, he said.

"As the nation's economy remains stalled and uncertain and its employment rate stagnates, we were able to win an agreement with Ford that will bring auto manufacturing jobs back to the United States from China, Mexico and Japan," union President Bob King said.

Despite the signing bonuses and profit-sharing, analysts expect a minimal impact to Ford's labor costs, in part because most of the new workers will be hired at lower wage rates than the company's longtime workers. Brian Johnson, an auto analyst with Barclays Capital, estimates the contract will add around $70 million to Ford's labor costs each year. If large numbers of older workers leave the company, Ford will spend even less, he said.

Johnson said Ford could see immediate benefits from the union approval in the form of a ratings upgrade, which would help lower its borrowing costs. Standard & Poor's Ratings Service has said it expects to raise Ford's corporate credit rating to "BB+" — which is one notch below investment grade — if the labor agreement is ratified.

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Chrysler, autos union agree on labor contract

 

Carlos Osorio / AP

Cars are seen on a Chrysler assembly line in Sterling Heights, Mich.

The United Auto Workers (UAW) union and Chrysler have reached a tentative four-year labor contract deal, the automaker said on Wednesday.

The deal follows agreements between the UAW and Chrysler's Detroit rivals General Motors and Ford. The UAW deal is Chrysler’s first since its bankruptcy and government bailout in 2009. It covers its 26,000 hourly production workers.

The agreement is subject to UAW member ratification. The GM contract was ratified by its workers late last month and Ford workers are in the process of voting that ends Oct. 18.

UAW President Bob King said in a press statement that the Chrysler pact will create 2,100 U.S. jobs and will include $4.5 billion in investments to produce new models and upgraded vehicles and components by 2015.

“Less than three years ago, Chrysler was teetering on the edge of bankruptcy as our nation was thrown into the worst economic crisis since the Great Depression,” King said. “This tentative agreement builds on the momentum of job creation and our efforts to rebuild America by adding 2,100 new jobs by the end of the agreement in 2015 to communities left in turmoil in the wake of the country’s economic collapse.”

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Ford, UAW reach tentative contract pact

Ford and UAW leaders have reached a tentative agreement on a new four-year contract. Insight with John Fleming, Ford Motor Company executive VP global manufacturing/labor affairs.

Ford Motor Co. and its unionized workers settled on a tentative four-year contract agreement that the automaker said Tuesday would add 12,000 hourly jobs in the U.S. by 2015.

Ford said the pact would add 5,750 more jobs than its previously announced commitment to increase positions by 7,000 by 2012. The carmaker also said it would invest $4.8 billion in its plants as part of the deal with the UAW. That’s part of a $6.2 billion plan to upgrade plants.

The deal still needs to be ratified by the United Auto Workers. If it does OK the pact, it would follow the agreement with GM ratified last week. Chrysler and the UAW are still in talks.

A Ford official told the Associated Press that most of the new hires will be at entry-level wages, which will keep costs down.   

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GM union leaders back new contract

Union leaders from General Motors factories around the country have endorsed a new four-year contract with the automaker, the Associated Press reports.

They are recommending that GM's 48,500 factory workers approve the deal in votes during the next week, the news wire said, noting that:

The agreement reached Friday includes a $5,000 signing bonus and improved profit-sharing instead of hourly pay raises for most of the workers. About 2,400 entry-level workers will get raises. They now make $14 to $16 per hour, about half the pay of a longtime UAW worker.

Profit-sharing will be a minimum of $3,500 next year.

The union now will focus on negotiations with Chrysler, and Ford will be next.

Since Chrysler isn't making as much money as GM, workers there probably won't see as good of a deal.

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GM-UAW agree on new contract

DETROIT — General Motors Co. and the United Auto Workers, sobered by the government bailout and bankruptcy at the automaker just two years ago, reached a tentative agreement on a new four-year contract without the public acrimony or strikes that have plagued the talks in the past.

Details weren't immediately released, but the union said the agreement includes some of its major goals, including assurances of new products for U.S. plants, improved health care benefits and a profit-sharing plan. The union said the plan will put laid-off members back to work.

"When GM was struggling, our members shared in the sacrifice. Now that the company is posting profits again, our members want to share in the success," UAW Vice President Joe Ashton, the chief negotiator with GM, said in a statement. "The wages and benefits we negotiated in this tentative agreement reflect the fact that it was UAW members who helped turn this company around."

UAW President Bob King, who was reached by phone Friday night, said he wouldn't comment on the agreement until after he has met with local union leaders.

The contract covers 48,500 GM workers in the U.S. GM was the first of the Detroit Three to reach an agreement with the UAW. Chrysler Group and Ford Motor Co. are still negotiating.

The UAW announced the agreement just after 11 p.m. EDT Friday (0300 GMT Saturday), after a little more than seven weeks of closed-door bargaining.

The UAW's contract with GM expired Wednesday, but the union had extended it indefinitely while negotiators continued to talk. In the past, workers might have gone on strike when the deadline passed. But this year, GM and Chrysler workers had limited ability to strike under the terms of the companies' government bailouts two years ago. These talks are the first since GM and Chrysler needed government aid to make it through bankruptcy protection in 2009.

Workers must vote on the plan before it will take effect. Union leaders from around the country have been asked to come to Detroit Tuesday to learn the details so they can explain them to their members. GM says a vote is expected in the next week to 10 days.

"We used a creative problem solving approach to reach an agreement that addresses the needs of employees and positions our business for long-term success," said Cathy Clegg, GM's vice president of labor relations. "We worked hard for a contract that recognizes the realities of today's marketplace."

Talks between GM, Ford and Chrysler determine the wages for 112,500 factory workers at all three companies. They also set the bar for wages at auto parts companies, U.S. factories run by foreign automakers and other manufacturers, which employ hundreds of thousands of people.

The White House also will be watching the outcome of the talks. GM received $49.5 billion in government bailout funds two years ago and is still part-owned by the U.S. Treasury. An agreement that is favorable to GM could help the company's stock rise, which would get the Treasury closer to making back the money it is owed when it sells its remaining shares.

GM began the talks paying its workers an estimated $56 per hour in wages and benefits, which is about the same amount that Ford and Toyota Motor Co. pay their U.S. workers but higher than Chrysler and Hyundai Motor Co.

After its wrenching trip through bankruptcy protection, GM is making money again. The company made $4.7 billion last year, its first annual profit since 2004. But it isn't eager to add costs after years of layoffs and plant closings.

The UAW has shown a willingness to work with GM to cut labor costs. Last fall, the union agreed to lower the wages of 40 percent of its workers at a Michigan plant so it can profitably build the subcompact Chevrolet Sonic there. In turn, GM has promised to invest in its U.S. workers and facilities. Earlier this summer, GM pledged to put $2 billion into 17 U.S. facilities over the next 18 months. The company says the investment will create or retain 4,000 jobs.

The UAW hopes to show that it can work cooperatively with auto companies as it tries to unionize U.S. factories owned by Nissan Motor Co., Honda Motor Co., Volkswagen AG and other foreign automakers. King said the union remains committed to organizing those plants.

"As long as unionized workers are being forced to compete with nonunion workers who in most cases receive lower pay and benefits — many in temporary jobs — there will continue to be a downward pressure on the wages and benefits of all auto workers," he said.

The union's focus on GM slowed the Chrysler negotiations and drew an angry response earlier in the week from CEO Sergio Marchionne.

Marchionne accused King of failing to show up at Chrysler's Auburn Hills, Michigan, headquarters to finalize a deal on Wednesday night. Marchionne then left the country, so it's unlikely a deal will be finalized until he returns next week.

Talks with Ford have made little progress while negotiations continue with the other two companies.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Toyota says that it will recover before the date of the contract

TOKYO - Toyota says that its production recovery faster than initially expected about a month, with car production be to and to pick up in Japan and abroad from next month.

Toyota Motor Corp. made the announcement in a statement on Wednesday prior to the release of its result for the financial year end of March.

The Japanese automaker had initially said that production would begin with a full recovery improvements in Japan by July, and overseas in August, not until the end of this year does not.

Production of Toyota has disturbed by the magnitude 9.0 earthquake and subsequent tsunami that Northeastern Japan met on 11 March.

Copyright 2011, the associated press. All rights reserved. This material may not be published, broadcast, rewritten or distributed.

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