Tentative Contract Agreement Reached Between Stellantis and United Auto Workers, Mirroring Ford’s Model

by Joshua Brown
Stellantis-UAW Contract Agreement

Stellantis, the manufacturer of Jeep, has entered into a provisional contract deal with the United Auto Workers (UAW) union, closely following a framework previously established by Ford, according to individuals familiar with the negotiation process. These sources requested anonymity as they are not permitted to disclose details of the discussions publicly.

With this tentative agreement, General Motors remains the sole automaker yet to secure a contract with the union. The pact is poised to terminate a six-week-long strike involving over 14,000 Stellantis workers at assembly facilities in Michigan and Ohio, as well as parts distribution centers nationwide.

Similar to their counterparts at Ford, striking workers at Stellantis are anticipated to dismantle their picket lines and resume their duties in the forthcoming days, prior to a vote by 43,000 union members to ratify the agreement.

Substantial aspects of Ford’s contract are expected to be replicated in the Stellantis agreement. The Ford accord stipulates a 25% general wage increase for top-tier assembly plant workers over the next four and a half years, with an immediate 11% hike upon ratification. Additional cost-of-living adjustments would elevate these increases to beyond 30%, thereby enabling top assembly plant workers to earn in excess of $40 per hour. Currently, top-scale workers at Stellantis earn approximately $31 per hour.

The Stellantis contract, like the Ford contract, is projected to remain in effect until April 30, 2028.

Notably, the agreement includes provisions for a new vehicle to be produced at a previously shuttered facility in Belvidere, Illinois, which the company had intended to close.

Bruce Baumhower, the local union president at a significant Stellantis Jeep factory in Toledo, Ohio, that has been on strike since September, anticipates that workers will endorse the contract, given the substantial pay increases, including an immediate significant raise.

“An 11% increase is directly stipulated in the agreement,” he stated, describing the deal as “historic.”

Some union members had expressed dissatisfaction with UAW President Shawn Fain’s initial proposal of 40% wage increases, which was intended to match executive compensations. However, Baumhower noted that opening negotiations with a high figure is a standard tactic.

Discussions with General Motors were ongoing as of Saturday, aiming to finalize a similar contract. Over 14,000 GM workers continue to strike at plants in Texas, Michigan, and Missouri.

The UAW initiated targeted strikes against Ford, General Motors, and Stellantis on September 15 following the expiration of existing contracts. Strike activities expanded on September 22, incorporating 38 additional GM and Stellantis parts warehouses.

The union entered intense negotiations with Stellantis the day subsequent to the Ford agreement announcement and concluded the tentative contract on Saturday.

Under Ford’s agreement, employees with pensions are set to see modest increases upon retirement, while those hired post-2007 with 401(k) plans are expected to receive substantial hikes. For the first time, the union will possess the right to strike over any company plans to shut down plants. Temporary workers are also slated for significant wage hikes, and the period for new hires to reach top pay has been shortened to three years.

In recent months, other labor unions adopting aggressive bargaining approaches have also succeeded in securing wage and benefit enhancements for their membership.

AP Business Writer Haleluya Hadero contributed to this report from Jersey City, New Jersey.

Frequently Asked Questions (FAQs) about Stellantis-United Auto Workers Contract Agreement

What is the main focus of the tentative agreement between Stellantis and the United Auto Workers union?

The main focus of the tentative agreement is to put an end to a six-week strike by securing a new contract for over 14,000 Stellantis workers. The contract closely follows a framework previously established by Ford, and it includes substantial wage increases for the employees.

Who are the parties involved in this agreement?

The parties involved are Stellantis, the manufacturer of Jeep, and the United Auto Workers (UAW) union. Bruce Baumhower, the local union president at a significant Stellantis Jeep factory in Toledo, Ohio, is one of the individuals publicly speaking about the agreement.

What happens to General Motors in this scenario?

General Motors remains the only major automaker without a contract agreement with the UAW. As of the last update, over 14,000 GM workers continue to be on strike at various plants.

What are the financial terms for Stellantis workers under the new agreement?

Under the new agreement, Stellantis workers will see a significant wage hike. Top-tier assembly plant workers are slated to receive a 25% general wage increase over the next four and a half years, with an immediate 11% increase upon the deal’s ratification. Additional cost-of-living adjustments could raise these figures to over 30%.

How long is the Stellantis-UAW contract expected to last?

The contract is projected to remain in effect until April 30, 2028, mirroring the duration of Ford’s contract with the UAW.

What provisions are included for facilities and new hires?

The agreement includes plans for a new vehicle to be produced at a previously closed facility in Belvidere, Illinois. Additionally, the time it takes for new hires to reach the top of the pay scale has been shortened, similar to the terms in the Ford agreement.

Was the Stellantis agreement influenced by any other labor union negotiations?

Yes, the Stellantis agreement closely follows the framework set by Ford’s recent contract with the UAW. The terms of the Ford contract have served as a template for the Stellantis-UAW agreement.

How did the union and Stellantis come to this tentative agreement?

Intense negotiations between the union and Stellantis commenced the day after the Ford deal was publicly announced. The tentative agreement was finalized on the subsequent Saturday.

What is the next step for the Stellantis-UAW agreement?

The next step is for the agreement to be ratified by a vote involving 43,000 UAW union members. Striking workers are expected to return to work in the coming days, prior to the ratification vote.

More about Stellantis-United Auto Workers Contract Agreement

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LaborRights4All October 28, 2023 - 9:45 pm

Strikes work people. Plain and simple. Workers stood their ground and look what happened.

Janet_in_Ohio October 28, 2023 - 10:08 pm

My cousin works at one of those plants in Ohio. He’s been talking bout the strike nonstop. Hope this means he’ll be back to work soon.

TechEnthusiast October 29, 2023 - 3:43 am

This could be a game changer for Stellantis. That idled factory in Illinois getting a new vehicle? Big moves.

Unicorn101 October 29, 2023 - 6:30 am

Bruce Baumhower sounds pretty optimistic. If he’s right about the 11%, that’s a deal to celebrate.

FinExpert October 29, 2023 - 7:16 am

Stellantis’ stock might see some interesting moves after this. Keep an eye out, investors.

Mike_J October 29, 2023 - 11:30 am

Wow, didn’t see this comin’. GM’s the only one left without a deal now. what’s up with them?

SarahW October 29, 2023 - 4:24 pm

Huge win for Stellantis workers, especially after that long strike. About time they got a solid pay hike.

EconWatch October 29, 2023 - 4:49 pm

Mimicking Ford’s template, huh? Interesting strategy. Wonder how this’ll impact the broader labor market.


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