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UAW, DaimlerChrysler Reach Tentative Deal

September 15, 2003

DETROIT (AP) _ The auto workers union reached a contract agreement with one of Detroit’s Big Three automakers but was still negotiating with the other two Monday morning, hours after their labor contracts expired.

The United Auto Workers said it had a tentative, four-year contract deal with DaimlerChrysler AG’s Chrysler Group. Representatives of the union and General Motors Corp. and Ford Motor Co. were still talking.

The previous contracts, negotiated in 1999, expired at midnight Sunday. But at a time when the U.S. market share for GM, Ford and DaimlerChrysler is at an all-time low, most observers said the probability of a strike was low.

Details of the tentative agreement with Chrysler weren’t released, but UAW President Ron Gettelfinger said the deal contains what the union hopes to see in the other contracts.

``This is the framework for the pattern agreement, absolutely,″ Gettelfinger said during a news briefing. Chrysler workers must still ratify the deal.

Ford and GM employees will report to work as usual while negotiations continue, Gettelfinger said. The UAW had hoped to reach simultaneous pacts with the Big Three, as well as auto suppliers Visteon Corp. and Delphi Corp.

Clyde Sims, co-chair of the UAW’s national negotiating committee meeting with GM, said Sunday the union was close to a tentative agreement with GM and that the overall tone of the talks had been ``professional, efficient and respectful.″

John S. Franciosi, senior vice president for employee relations at Chrysler and a member of the bargaining team, said his company’s tentative agreement ``balances the needs of our employees _ the membership of the UAW _ as well as the needs of our company.″

The union typically chooses one carmaker as the lead negotiator and uses that pact as a model for the other two. The union bargained with all three at once this year and did not publicly name a lead company.

The UAW and the Big Three, along with Delphi and Visteon, have been meeting at times late into the night since mid-July. They negotiated on issues such as wages, jobs, health care and pensions that affect 300,000 workers and nearly a half-million retirees and their spouses.

Some analysts and labor experts have said the new pacts likely will reflect the difficult predicaments of the automakers, whose combined U.S. market share fell to an all-time monthly low of 57.9 percent in August.

Analysts said both sides understood the others’ situations and that compromise in areas such as wage and pension increases was likely.

Gettelfinger had insisted the union would not retreat on health care benefits, so some analysts said negotiators were likely to reach agreements that would give automakers more flexibility in plant closings in exchange for continued low-cost medical coverage.

One Wall Street analyst has said the Big Three likely needs to close between seven and 10 plants in North America to move supply and demand into better balance.

The current contracts were negotiated in 1999 during the term of Gettelfinger’s predecessor, Stephen Yokich, who died last year shortly after his retirement. Those pacts included 3 percent annual pay hikes, a ban on plant closings and nearly cost-free health care.


On the Net:

DaimlerChrysler: http://www.daimlerchrysler.com

Ford: http://www.ford.com

General Motors: http://www.gm.com

United Auto Workers: http://www.uaw.org

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