UAW reaches tentative deal with Fiat Chrysler on new contract

Art Wheaton of the Worker Institute at Cornell University said that a short-term strike could help the UAW leadership prove to the rank and file that it is being tough with Fiat Chrysler, which he said matters because of a few worker perceptions that the union and company are too close.

That sent the two sides back to the bargaining table, and it was only moments after the deadline passed that a new, tentative agreement was announced by the UAW global Union on its Facebook page, and confirmed moments later by FCA.

Although the deal initially received tentative approval by the union, UAW members formally rejected the automaker’s offer last week – even though UAW President Dennis Williams had resoundingly applauded the bargain.

Still, a strike at Fiat Chrysler would be the largest walk-out in the US since 45,000 Verizon workers went on strike in August of 2011, according to the Labor Department.

United Auto Workers negotiators huddled with Fiat Chrysler Automobiles NV executives late Wednesday, hoping to avert a midnight walkout that threatened to end what both recently hailed as a new era of cooperation.

Sean McAlinden, economist with the Center for Automotive Research in Michigan, estimated that Fiat Chrysler could lose $40 million of operating profit and at least $1 billion of revenue weekly in a strike of all its US production plants. Workers do not receive their first strike pay until a strike reaches its third week.

It was unclear what changes were made by bargainers to achieve a new agreement.

“It’s not about the first day or two”, said David Kudla, CEO and chief investment officer of Mainstay Capital in Grand Blanc. As of September 30, its supply of inventory in the USA stood at 77 days worth of sales. Wednesday traders apparently were unconcerned about a strike as FCA shares rose 4% to $14.82.

A vote of the UAW FCA membership will decide whether or not the deal is finalized.

“It’s great that were not going on strike, but if it’s the same deal as before we could be going through this all over again”, he said.

“There are multiple audiences for a strike and there are a lot of groups that are watching closely and many of them will not look at it favorably”, she said. Strike pay? $200 per week. The UAW Strike and Defense Fund covers medical benefits and prescription drugs but not dental, vision, hearing, accident and sick benefits.