“By moving car production to Mexico with its lower costs, it stands a better chance of making money on vehicles it typically uses incentives to move”, DeLorenzo said.
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Jodi Tinson, the spokesman for Fiat-Chrysler and Brian Rothenberg, the spokesman for UAW, however, declined to reveal the details of the contract. That employee will get a hike in two stages to reach the hourly wages to nearly $30 an hour. Today, they hit the wage cap after four years. They now make $15.78 upon hiring and over time are raised to $19.28 per hour.
That’s according to multiple reports, such as one in the Detroit Free Press that says FCA plans to commit $5.3 billion to U.S. auto plants over the next four years.
The economic rewards are consistent with comments made by UAW President Dennis Williams and Fiat Chrysler CEO Sergio Marchionne about rewarding the membership for sacrifices made in recent years and creating a “path” for higher wages for entry-level workers and ending the tiered-system “over time”.
Williams said Tuesday evening that all three companies are interested in forming the huge health-care cooperative, but it could come together at a later date, outside of the contract. They said that it was a tentative agreement and would have to be approved by members through a voting process. By winning salary raises, UAW would witness a revival of its efforts to organize non-union car factories in the south of the U.S. and why not, encourage workers in other industries to act on their rights.
“GM and Ford members will be anxious to see how this agreement will be shaped to fit them and their company’s business position”, said Kristin Dziczek, a labor expert with the Center for Automotive Research.
Second-tier workers, who started working for the former Chrysler Group LLC in 2010, now account for about 45 percent of Fiat Chrysler’s hourly workforce. About 40,000 Fiat Chrysler employees are represented by the US union, and of that figure, about 36,600 are plant workers paid by the hour in a two-tiered compensation structure.
Howes tells us that Marchionne was clear in a Tuesday press conference that once the deal had been ratified, he would move on to his “number one objective”. At rallies and conventions, UAW workers have loudly called for its elimination in this agreement.
But a contract that offers profit-sharing in lieu of raises or full wage parity for entry-level workers may not sit well with some workers.
The contract also would give workers hired before 2007 their first raise in 10 years, the people said.
Union officials are said to have agreed to allow Chrysler 200 and Dodge Dart production to move from Michigan and Illinois, respectively, to a factory in Toluca, Mexico.
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The half of Toledo Assembly that builds unibody vehicles will be converted to body-on-frame production to build the next-generation Jeep Wrangler, due in 2017, as Automotive News reported Sept. 1.
