DETROIT (AP) – The United Auto Workers union and General Motors Co. have reached a tentative agreement on a new four-year contract, avoiding a strike for now.
The UAW said the agreement was reached at 11:43 p.m. Sunday, 16 minutes before the deadline it had set to either reach an agreement or call a strike at GM’s U.S. plants.
Details of the proposed contract weren’t immediately available. The UAW said local union leaders will meet Wednesday in Detroit to vote on the tentative agreement. If they approve it, GM’s U.S. hourly workers will vote on it.
“Well its essential, it plays a big role in just gaining the trust of the American people,” UAW Local 1714 President Rob Morales said. “When you come to the table and come to an agreement with the other side, it goes to show they’re willing to come to an agreement that will benefit both the company and the union.”
If the union leaders make the tentative agreement official on Wednesday, there will be informational meetings for local union workers shortly thereafter before they will vote on the new deal.
The agreement covers 52,600 U.S. auto workers at 63 GM facilities in the U.S.
UAW President Dennis Williams said the proposed deal will provide “long-term, significant wage gains and job security benefits now and in the future.” The union also hinted that this agreement – like a contract passed last week by Fiat Chrysler workers – gradually will eliminate a much-hated two-tier wage system in the plants.
GM said in a statement that the agreement benefits employees but still provides flexibility to the company. The company said it would not comment further until the agreement is ratified.
The union told GM on Saturday that it would terminate its contract just before midnight Sunday. The UAW made a similar strike threat in discussions with Fiat Chrysler, but negotiators also were able to avoid a walkout then.
On Thursday, union members at Fiat Chrysler voted to approve a four-year contract that includes pay raises and phases out the two-tier wage system over eight years.
Williams indicated that the union wanted even better deals from GM and Ford Motor Co. because they are more profitable. The UAW hasn’t yet reached a tentative agreement with Ford.
GM reported last week that it earned $1.36 billion in the third quarter, including a record $3.3 billion pretax profit in North America on strong sales of trucks and SUVs. The company overcame $1.5 billion in costs from recalls over deadly ignition switches and beat Wall Street profit forecasts by a wide margin.
Executives said they believe they can negotiate a union deal that lets GM maintain 10 percent pretax profit margins in North America.
(Copyright 2015 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)