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Deal Between UAW, FCA Doesn’t Mean It’s All Over Yet

Deal Between UAW, FCA Doesn’t Mean It’s All Over Yet.

Ford, GM Talks Will Last Some Weeks Yet.

The tentative four-year agreement between the United Auto Workers (UAW) union and FCA looks set to be a basis for a deal with Ford and General Motors, although talks with the remaining companies is likely to take several more weeks.

The deal focussed on gradually winding down the two-tier wage system, and addressing escalating healthcare costs.

According to Fitch Group’s BMI Research, quoting local and trade press sources, the deal includes shifting all FCA car production to Mexico and investing $5.3 billion in U.S. plants to make higher margin trucks and SUVs. Only the Dodge Viper will stay in the U.S. The reports said the two-tier wage system will see second-tier workers receive extra bonuses for every one per cent of profit margin in North America over eight per cent. The deal is structured to phase-the two tier system out over time.

Local press reports suggested Ford and GM will find it easy to accept the general basis of the deal, but UAW negotiators will be keen on extracting more value for their members because of their higher profitability.

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