Details about the deal announced this morning between the Chrysler Group and United Auto Workers union have surfaced, and it's apparent that the smaller, less financially stable automaker has given away the least compared to similar deals already struck with the UAW by cross-town rivals General Motors and Ford.
First up is money. Automotive News reports that each of Chrysler's hourly workers will receive at least $5,750 in bonuses and other payments under the new agreement, which still requires ratification by the union's rank and file. That includes a signing bonus of $3,500, which is markedly less than the $5,000 bonus offered by GM and $6,000 by Ford. AN also reports that the signing bonus will be paid out in two parts, one now and another when Chrysler "achieves financial stability." Other available bonuses include a yearly performance bonus of $500 and another $500 if quality targets are met, as well as a $1,000 bonus for hitting "world class manufacturing metrics."
Wages for entry-level workers will also rise, with the base rate of $14 an hour increasing to $15.78 immediately and then steadily increasing to $19.28 an hour by the end of the four-year contract. Better benefits, tuition assistance and a more generous profit-sharing plan are also part of the deal.
Finally, Chrysler has agreed to billions of dollars of new investment in its U.S. manufacturing base and expects the new deal will create 2,100 additional jobs. The biggest investment of $1.3 billion will be made in Chrysler's transmission plants in Kokomo, Indiana, which are slated to build the company's next-generation eight- and nine-speed automatic transmissions. Other big winners include the assembly plant in Belvidere, Indiana that currently makes the Dodge Caliber, Jeep Patriot and Jeep Compass and is scheduled to receive a new small vehicle in the future; it would receive a $600 million investment. Chrysler's plant in Sterling Heights, Michigan that makes the Dodge Avenger, Chrysler 200 and Chrysler 200 Convertible would also get an $850 million investment.