UAW Reaches Tentative Deal With Stellantis, Following Ford

The United Auto Workers union reached a tentative agreement on a new labor contract with Stellantis, the parent company of Chrysler, Jeep and Ram, on Saturday, a person familiar with the matter said Saturday.

The agreement comes three days after the union and Ford Motor announced a tentative agreement on a new contract. The two deals contain many of the same or similar terms, including a 25% general wage increase for UAW members as well as the possibility for cost-of-living wage adjustments if inflation flares.

The tentative agreement with Stellantis will require approval by a union council that oversees negotiations with the company, and then ratification by UAW members.

The deal with Stellantis means that only General Motors had not yet reached an agreement with the union.

The union’s contracts with the three automakers expired Sept. 15. Since then, the union has called on more than 45,000 autoworkers at the three companies to walk off the job at factories and at 38 spare-parts warehouses across the country.

The most recent escalation of the strike at Stellantis came Monday when the UAW told workers to go on strike at a Ram plant in Sterling Heights, Michigan, that makes the popular 1500 pickup truck. The strike has halted the production of Jeep Wranglers and Jeep Gladiators at a plant in Toledo, Ohio, and 20 Stellantis parts warehouses.

For decades, the union has negotiated similar contracts with all three automakers, a method known as pattern bargaining. Like the contract it hammered out with Ford, the tentative Stellantis deal would lift the top UAW wage from $32 an hour to more than $40 over 4 1/2 years. That would allow employees working 40 hours a week to earn about $84,000 a year.

Stellantis, GM and Ford began negotiating with the UAW in July. The companies have sought to limit increases in labor costs because they have higher labor costs than automakers such as Tesla, Toyota and Honda that operate nonunion plants in the United States.

The three large U.S. automakers are also trying to control costs while investing tens of billions of dollars to develop new electric vehicles, build battery plants and retool factories.

Stellantis, which is based in Amsterdam, was created in 2021 by the merger of Fiat Chrysler and Peugeot, the French automaker. The company’s North American business, based near Detroit, is its most profitable.

Stellantis surprised analysts recently by posting much stronger profits than GM, which is the largest U.S. automaker by sales. Stellantis earned 11 billion euros ($11.6 billion) in the first half of the year while GM made nearly $5 billion.

This article originally appeared in <a href="https://www.nytimes.com/2023/10/28/business/economy/uaw-stellantis-contract-deal.html">The New York Times</a>.