Canadian workers agree to change in terms as company battles to survive
27 April 2009

Chrysler's chances of avoiding filing for bankruptcy protection this week have improved, after it agreed a deal to reduce costs with its workers unions.

Chrysler is pinning its hopes of survival on the US government agreeing a tie-in with Fiat, but the Italian car company has said it will only agree a deal if labour union costs are driven down.

As a result, Chrysler announced a deal on Monday with the United Auto Workers Union (UAW), which represents the majority of its US workers, to revise labour terms and change its financial obligations to the union's retiree healthcare plan.

The UAW union said Chrysler, Fiat and the US Treasury Department agreed to the deal, although no details of what concessions had been given were revealed. Workers must approve the terms by Wednesday.

Chrysler had announced a similar deal with its Canadian Auto Workers union late last week.

Under the terms of the agreement Chrysler has agreed to:- Retain current CAW wages and pension benefits- Restructure the healthcare fund- End a third shift at Chrysler's Windsor assembly plant- Keep all of its Canadian plants open

CAW agreed to:- Eliminate semi-private hospital room cover- End employee discount on vehicle purchases- End a $3500 (£2400) employee vacation buyout option- Stop reimbursing tuition fees- Increase prescription costs- A 40-minute limit for for lunch and toilet breaks- Let Chrysler use part-time temporary workers- Let suppliers assemble parts in the factories

CAW leader Ken Lewenza called the agreement "the most torturous and unfair process imaginable".

Chrysler has until this Thursday to convince Fiat and the US government that it has restructured sufficiently to be a viable concern. If it fails, it will file for bankruptcy protection.

Add your comment

Log in or register to post comments

Find an Autocar car review

Driven this week

  • Dallara Stradale
    The Stradale is the first road-legel car from Italian motorsport constructor Dallara
    First Drive
    16 March 2018
    The motorsport constructor's first road car is inspired by Lotus minimalism. Does it thrill on road and track?
  • Hyundai i30 N
    Standard spec is good so paint colour is our car’s only option
    First Drive
    16 March 2018
    What’s Hyundai’s first hot hatch and N-brand debutant really like? Let’s find out
  • Porsche Boxster GTS
    This is the new GTS version of the Porsche Boxster
    First Drive
    15 March 2018
    The 718-generation Boxster is our favourite roadster of the moment – so is this new GTS variant worth the extra outlay?
  • BMW 5 Series
    First Drive
    15 March 2018
    The BMW 5 Series is top of the mid-exec pack, but is there still room for a diesel saloon in everyday family life?
  • Audi A7 front
    First Drive
    14 March 2018
    The new Audi A7 Sportback looks the part, but how does the new Mercedes-Benz CLS rival cope on UK roads? We find out