Rebecca Cook / Reuters

Fiat Chrysler avoids strike with new tentative contract

Fiat Chrysler may have avoided a US strike after reaching a tentative deal with the UAW that members must OK

The United Auto Workers (UAW) union has reached a tentative deal with Fiat Chrysler Automobiles (FCA) on a new four-year contract, the Union said early Thursday.

FCA confirmed it had reached a new tentative agreement with the union but said in a statement that the company cannot discuss the specifics because the deal is subject to member ratification. A spokeswoman declined further comment.

UAW, which represents around 40,000 FCA factory workers at 23 U.S. plants, said in a post on its website that its bargaining committee had "secured significant gains."

The tentative agreement must be ratified by vote of Fiat Chrysler's workers in the United States. The UAW Chrysler Council will meet in Detroit at 11 a.m. on Friday to discuss the agreement and vote on it, the union said in a tweet.

If the council of union leaders approves the deal, UAW will release details and the ratification process will begin, a spokesman said.

The UAW had previously told the company that it would terminate the current labor contract if a new deal was not reached by 11:59 p.m. EDT on Wednesday.

This is the second agreement FCA and the union have reached. Last week, UAW members overwhelmingly rejected a previous tentative agreement, saying it didn't go far enough in restoring benefits workers lost in previous contracts.

On Wednesday evening, UAW leaders posted on Facebook that talks were continuing at 7:30 p.m. according to the Detroit Free Press.

An update at 10:17 p.m. repeated that talks were continuing, and told workers to “continue to work, do not walk out of the plant until you hear from your local union leadership.”

The union's four-year contracts with all three automakers expired on Sept. 14, but workers have remained on the job under a contract extension.

Union members overwhelmingly rejected a tentative agreement with the company last week. 

That deal included pay raises, the potential for increased profit sharing and a $3,000 signing bonus. But members have called for an end to the current two-tier pay structure, more specific guarantees of new vehicles for U.S. factories and a return of cost-of-living pay raises. The UAW agreed to the two tiers of pay when then-Chrysler was near bankruptcy in 2007.

Sixty-five percent of FCA's union workers voted against the four-year deal. 

FCA workers haven't gone on strike since 2007. Such a move would have been expensive for FCA. A weeklong strike could cost the company as much as $1.7 billion in revenue and $35 million in net income, according to Sean McAlinden, chief economist for the Michigan-based Center for Automotive Research.

Al Jazeera with wire services

Related News

Find Al Jazeera America on your TV

Get email updates from Al Jazeera America

Sign up for our weekly newsletter


Get email updates from Al Jazeera America

Sign up for our weekly newsletter