United Auto Workers members rally outside Stellantis’ Ram 1500 plant in Sterling Heights, Michigan, after the union called a strike at the plant on Oct. 23, 2023.
Michael Wayland / CNBC
DETROIT – United Auto Workers members at Chrysler owner Stellantis have ratified a new labor contract following a historically contentious round of bargaining between the union and company, according to preliminary results posted Friday by the union.
The deal is the second this week for the Detroit automakers. A deal with General Motors received 54.7% support from UAW-GM members who voted, according to preliminary results. UAW members with Ford Motor are on pace to also ratify their agreement, but are continuing to vote Friday.
A majority of Stellantis facilities overwhelmingly approved the deal, which, like GM and Ford, includes at least 25% wage increases. It also includes the reopening of an Illinois plant that had been indefinitely idled.
According to the UAW’s vote tracker, the deal was supported by 68.4% of the more than 26,000 autoworkers at Stellantis who voted. There were still a few smaller facilities left to finalize voting, but there aren’t enough employees at those locations to offset the roughly 9,650-vote margin.
The Stellantis deal received notable objection at the automaker’s Jeep plants in Toledo, with 55% of workers there opposing the deal. Other major assembly plants overwhelmingly supported the pact.
Both the UAW and Stellantis declined to comment on the results until they’ve been finalized.
The contract ratifications come weeks after the automakers and union reached tentative deals, ending roughly six weeks of targeted strikes by the UAW.
The agreements are record-setting for the union, which was far more confrontational and strategic during the talks than in recent history.
The union initiated negotiations with all three automakers at once, breaking from a recent pattern of bargaining with each automaker individually, selecting a lead company to focus efforts on and modeling the remaining deals off that leading tentative agreement.
When deals weren’t reached by a Sept 14. deadline, the union launched targeted strikes, plant by plant, as a way to keep the companies off guard and be able to ratchet up pressure, when needed.
At the peak of the work stoppages, roughly 40% of what was then 146,000 UAW members covered under the agreements were either on strike or laid off due to the disruptions.
The new contracts bring into the fold groups of workers such as battery employees and others that were not included in past deals. It’s not immediately clear how any UAW members the new deals will cover.
For the union and UAW President Shawn Fain, the deals represent significant economic gains; a path to secure future jobs for union ranks such as those battery plants; and a springboard for organizing efforts at other nonunion automakers operating in the U.S. — a main goal of Fain moving forward.
The union said improvements in the deal are valued at more than four times the gains from the 2019 contract and provide more in base wage increases than workers have received in the past 22 years.
For the companies as well as their investors, the contracts represent the top-end of forecast increases in labor costs. While the automakers several times called foul on the union’s tactics, including six weeks of targeted strikes, they should be able to stomach the cost rises. That’s not to say they won’t be seeking offsets to the increases elsewhere in the forms of future investments, restructuring and other means.
