Fiat Chrysler Shares Rise Again as U.S. Strike Deadline Nearsby
Union set Wednesday deadline for first walkout since 2007
Workers had voted down deal that gave raises, narrowed pay gap
Fiat Chrysler Automobiles NV shares rose again Wednesday in New York, even with a U.S. strike threat looming against some of the company’s most profitable operations.
The stock climbed 4 percent to close at $14.82. It was the sixth straight session in which the shares gained, picking up 21 percent since Sept. 29, when they closed at $12.21.
The UAW notified the company that it plans to go on strike at 11:59 p.m. Detroit time on Wednesday. The union, which represents about 40,000 U.S. workers at Fiat Chrysler, last struck the company’s predecessor with a six-hour work stoppage in 2007. A walkout could shut Fiat Chrysler plants producing the profitable Jeep sport utility vehicles and Ram trucks, products that have been the linchpins of the company’s resurgence.
A strike would disrupt Fiat Chrysler amid the company’s streak of 66 consecutive U.S. monthly sales gains and cloud an auto industry that has been a rare bright spot in U.S. manufacturing, with deliveries on pace for the best year in more than a decade. The Detroit-based UAW still needs to reach agreements with General Motors Co. and Ford Motor Co., which could yield more lucrative contracts.
Strikes by the UAW have been rare for the past decade. The last two were in 2007, when workers walked out of GM plants for two days in addition to the brief stoppage at Chrysler factories.
The union had said on Oct. 1 that members at Fiat Chrysler voted about 65 percent against a tentative agreement that would have granted raises to all employees and narrowed the pay gap for second-tier workers.
The accord, reached Sept. 15, would have boosted hourly base wages over the contract term to $29.76 at the senior tier and as much as $25.35 for the second tier, according to the UAW. The ratification bonus would have been $3,000. The automaker also had pledged to invest as much as $5.3 billion in the U.S.
The rejection stalled UAW President Dennis Williams’s efforts to move on to winning tentative contracts with GM and Ford. Williams sought to use the deal with Fiat Chrysler Chief Executive Officer Sergio Marchionne to negotiate similar but more lucrative pacts from the other two companies.