The United Auto Workers (UAW) union stated on Wednesday that rank-and-file members at Fiat Chrysler Automobiles NV have voted to support a new four-year labor contract with the automaker, assisting the Italian-American firm prevent a strike as it collaborates to merge with France’s Groupe PSA.
Fiat Chrysler (FCA) and PSA, the maker of Peugeot and Citroen, in October declared a strategy of $50 billion merger to form the world’s fourth-largest automaker.
FCA’s 47,200 rank-and-file UAW members voted 71% in favor of the new agreement. The deal comes after contracts the UAW already concluded with larger competitors General Motors and Ford Motor.
“Every full-time production employee currently at FCA will be at top rate by the end of this four-year agreement,” stated Cindy Estrada, UAW vice president and director of the union’s FCA department. She added that all temporary employees are also going to have a path to full employment.
“We are pleased to have reached a new agreement that permits us to continue our record of adding good-paying UAW-represented jobs,” stated FCA North America Chief Operating Officer Mark Stewart.
Ratification of the contract had not been observed as a sure thing, as union members at FCA in 2015 declined the first version of a contract. Furthermore, a federal corruption probe associated with embezzlement at the union drew attention.
The federal corruption investigation led GM to submit a racketeering lawsuit against FCA, alleging its rival bribed union officials over many years to corrupt the bargaining process and gain advantages, costing General Motors billions of dollars.
FCA has rejected the lawsuit as groundless.
The contract with GM that was ratified by the employees in October which came after a 40-day strike in the United States that basically shuttered GM’s North American operations and cost the automaker $3 billion.
The UAW has stated the contract with FCA consisted of a commitment by the automaker to invest $9 billion, creating 7,900 new jobs over the course of the contract. Of the $9 billion, $4.5 billion was declared previously this year, to be invested in five plants and generating 6,500 jobs.
The investments include $2.8 billion at Warren Truck Assembly plant located in Michigan to construct a new a plug-in hybrid SUV in 2021 and a potential boost of 1,500 jobs.
FCA is also going to invest $160 million at its Toledo, Ohio, plant to build a new plug-in hybrid Jeep Wrangler in 2020, and $3 billion at its Jefferson Assembly plant in Detroit to a construct a plug-in hybrid Jeep Grand Cherokee in 2021 and other new vehicles.