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UAW-Stellantis deal includes $18.9 billion in new investments

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  • The United Auto Workers union said Chrysler parent Stellantis plans to invest $18.9 billion in the United States by April 2028.
  • The 4.5-year tentative agreement must still be ratified by the approximately 43,000 UAW members covered by the agreement at Stellantis.
  • The deal was reached after about six weeks of targeted union strikes against Stellantis, General Motors and Ford Motor.

Randy Harvard (R), a 29-year-old auto worker, stands with other United Auto Workers members after the union called a strike on October 23, 2023 at the Stellantis Ram 1500 plant in Sterling Heights, Michigan.

Michael Wayland/CNBC

DETROIT — The United Auto Workers union said Chrysler parent Stellantis plans to invest $18.9 billion in the United States by April 2028, including $1.5 billion for the production of new pickup trucks. medium-sized plant at an idle plant in Belvidere, Illinois.

The investments are expected to be completed during the term of the 4 1/2-year tentative agreement, which must still be ratified by the approximately 43,000 UAW members covered by the proposed contract at Stellantis.

Details of the tentative agreement were released Thursday evening after local UAW leaders approved the deal, which UAW President Shawn Fain called “the most lucrative contract our union has has won for decades.

The tentative agreement was reached Saturday after about six weeks of targeted union strikes against Stellantis, General Motors and Ford Motor. The work stoppages began on September 15 after the parties failed to reach an agreement covering 146,000 UAW members with automakers before the strike deadline.

“For the first time in a long time, we did the unthinkable: reopened a factory,” Fain said during an online broadcast Thursday, referring to the Belvidere factory, which closed in February 2022. “We do not We didn’t do it by begging the company, or agreeing to work terrible hours, or taking a pay cut, or continuing a race to the bottom. We didn’t do it by giving back. We didn’t do it. we did by fighting back.

Before the talks, UAW Vice President Rich Boyer, who led the Stellantis negotiations, made product commitments a priority and stressed that the Belvidere plant was a make-or-break issue.

The details announced Thursday include $8.1 billion in product commitments guaranteed by Stellantis union negotiators, the UAW said.

UAW Vice President Rich Boyer speaks to union members during a “Solidarity Sunday” rally August 20, 2023 in Warren, Michigan.

Michael Wayland/CNBC

In addition to Belvidere, other planned investments include $1.5 billion each in a Dodge-Jeep plant in Detroit and a Jeep complex in Ohio; $1.4 billion at a Ram plant in Sterling Heights, Michigan; and $600 million for Stellantis’ Warren Truck plant in suburban Detroit.

The union said the company also plans to invest $3.2 billion in a new joint venture battery factory in Belvidere, scheduled to open in 2028. The agreement further lists investments of 6, $2 billion in batteries previously announced for two joint venture battery facilities in Kokomo, Indiana. .

Fain said UAW members at the Belvidere battery plant will be represented by the union through the company that leases the employees to the joint venture. It is unclear whether the factories already announced will be subject to the same conditions. A UAW spokesperson had no immediate comment after details of the agreement were announced.

A Stellantis spokeswoman declined to comment on the union’s announcements.

The UAW said negotiators also secured an employee car rental program that mirrors that of company management. They said this included discounted prices, unlimited miles, insurance, maintenance and repairs.

Much like the UAW’s tentative agreement with Ford, the agreement includes significant wage increases, bonuses and other enhanced benefits for autoworkers, such as profit-sharing payments and ratification bonus of $5,000.

The 25% increases include an 11% increase upon ratification, followed by a 3% increase the following three years, and then a 5% increase in September 2027.

UAW members at Ford have already started voting on the tentative deal: 82 percent of workers at Ford’s Michigan assembly plant voted in favor of the deal this week. The suburban Detroit plant was among the first to strike, along with other GM and Stellantis assembly plants.

UAW members Stellantis and GM are expected to vote on the deals over the next two weeks. A simple majority is needed to ratify agreements.

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