NEW YORK (CNN/Money) – General Motors Corp. and united Auto Workers announced a new labor contract Thursday morning, concluding three new interim labor pacts for the country`s major automakers. Details of the new pact were not immediately available. The old four-year contract expired Sunday, but GM employees remained in service as the world`s largest automaker and the union continued discussions. There are 115,000 active UAW members at GM and 340,000 retirees and surviving family members who are covered by the labor pacts, making it one of the largest employment contracts in the country. The UAW agreements authorize the closure or sale of more than a dozen U.S. plants and thousands of job cuts. But the union has earned moderate gains on wages and benefits, according to a summary of the Chrysler contract obtained by Reuters, which is expected to reflect financial conditions for the GM and Ford contracts. The agreements were reached in a difficult environment for the U.S.
auto industry, with buyers demanding greater incentives to purchase, overcapacity in global auto production and increased market share gains for Asian automakers, which are increasingly producing vehicles in non-unionized U.S. plants. „I think companies are coming out with a contract they can live with, but not with a bigger reduction in their employment costs,“ said Analyst David Healy of Burnham Securities. The union had received 17% of pension benefits during the duration of its four-year contracts. But the stock market`s decline and the low-interest environment have since led to multi-billion-euro deficits in pension plans and hurt carmakers` profits. UAW negotiators agreed on Monday on number 2 Ford Motor Co. (F: Research, Estimates) and No. 3 Chrysler Group, the North American unit of DaimlerChrysler AG (DCX: Research, Estimates), as well as parts supplier Visteon Corp. (VC: Research, Estimates), a former Ford unit.
Delphi Corp. (DPH: $0.07 to $9.59, Research, Estimates), the supplier of separated parts by GM (GM: $0.20 to $41.49, Research, Estimates) in 1999, just before the last round of contract negotiations, was also able to reach an agreement with the union on Thursday. Delphi and UAW held parallel discussions with the GM-UAW negotiations. „Over the past five days, we have completed negotiations with five of the world`s largest automakers,“ UAW President Ron Gettelfinger said at a news conference on Thursday.