Bloomberg.com, October 10, 2007, Wednesday

Bloomberg.com, October 10, 2007, Wednesday

http://www.bloomberg.com/apps/news?pid=20601087&sid=a0fFYlwT3cEA&refer=home

Chrysler Reaches UAW Agreement, Ends 6-Hour Strike (Update3)
By John Lippert

Oct. 10 (Bloomberg) -- Chrysler LLC and the United Auto Workers ended a six-hour strike by agreeing on a contract that echoes an historic accord on retiree health care between the union and General Motors Corp.

The UAW and Chrysler, the third-largest U.S. automaker, announced the settlement late today following a walkout at 11 a.m. New York time. In a similar showdown last month, GM workers staged a two-day strike before agreeing on a four-year contract.

Ron Gettelfinger, 63, the UAW president, had sought a Chrysler contract modeled after GM's, including job guarantees in exchange for a union-run retiree health-care trust. The contract is ``consistent'' with the GM pattern and includes a fund for retiree health care, Chrysler President Tom LaSorda said in a statement.

``Neither side can really afford a long strike, so it's no surprise they settled quickly,'' said David Lipsky, a labor relations professor at Cornell University in Ithaca, New York, in an interview.

``Teamwork in the leadership and solidarity in the ranks has produced an agreement that protects jobs for our communities and also protects wages, pensions, and health care for our active and retired members,'' UAW Vice President General Holifield said in a statement.

Details of the accord are being withheld until Chrysler workers vote to approve it, the union said.

The agreement ``balances the needs of our employees and company by providing a framework to improve our long-term manufacturing competitiveness,'' LaSorda said.

GM's Walkout

GM's contract, approved today by two-thirds of voting members, will allow the biggest U.S. automaker to shed $50 billion of future health-care obligations in exchange for job- security pledges. Chrysler wrangled with the union over the same issues.

The strike was the union's first against Auburn Hills, Michigan-based Chrysler in a decade. The union represents more than 45,000 hourly workers at the company.

The Chrysler talks marked the union's first negotiations with an automaker owned by a private-equity firm, Cerberus Capital Management LP, Chrysler's new owner.

``Strikes happen when the two sides disagree on something the union feels it has to have,'' said Dan Luria, an analyst at the Michigan Manufacturing Technology Center in Plymouth, Michigan. ``Something clearly changed between 11 a.m. and 5 p.m. My guess it was in the actions Chrysler is willing to take to secure jobs.''

To contact the reporter on this story: John Lippert in Southfield, Michigan, at jlippert@bloomberg.net
Last Updated: October 10, 2007 18:56 EDT