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The UAW's 'record contract' hinges on pensions, battery plants

DETROIT - After nearly four weeks of disruptive strikes and hard bargaining, the United Auto Workers and the Detroit Three automakers have edged closer to a deal that could offer record-setting wage gains for nearly 150,000 U.S. workers. General Motors, Ford Motor and Chrysler parent Stellantis have all agreed to raise base wages by between 20% and 23% over a four-year deal, according to union and company statements. Ford and Stellantis have agreed to reinstate cost-of-living adjustments, or COLA. The companies have offered to boost pay for temporary workers and give them a faster path to full-time, full-wage status. All three have proposed slashing the time it takes a new hire to get to the top UAW pay rate. The progress in contract talks follows the first-ever simultaneous strike by the UAW against Detroit's Big Three automakers. The union began the strike on Sept. 15 in hopes of forcing a better deal from each major automaker. But coming close to a deal is not the same thing as reaching a deal. Big obstacles remain on at least two major UAW demands: restoring the retirement security provided by pre-2007 defined benefit pension plans, and covering present and future joint- venture electric vehicle battery plants under the union's master contracts with the automakers. On retirement, none of the automakers has agreed to restore pre-2007 defined-benefit pension plans for workers hired after 2007. Doing so could force the automakers to again burden their balance sheets with multibillion-dollar liabilities. GM and the former Chrysler unloaded most of those liabilities in their 2009 bankruptcies. The union and automakers have explored an approach to providing more income security by offering annuities as an investment option in their company-sponsored 401(k) savings plans, people familiar with the discussions said. Stellantis referred to an annuity option as part of a more generous 401(k) proposal on Sept. 22. Annuities or similar instruments could give UAW retirees assurance of fixed, predictable payouts less dependent on stock market ups and downs, experts said. Recent changes in federal law have removed obstacles to including annuities as a feature of corporate 401(k) plans, said Olivia Mitchell, a professor at the University of Pennsylvania Wharton School and an expert on pensions and retirement. "Retirees want a way to be assured they won't run out of money," Mitchell said.

May 2016: FCA wins, Ford and GM stumble on weak car volumes

The May 2016 sales numbers are in, and it looks as though FCA is getting some vindication for boldly cancelling two slow-selling car models. Meanwhile, Ford saw overall sales dip and GM's May volume took a big dive versus the same month in 2015. While Marchionne's decision to axe the Chrysler 200 and Dodge Dart has drawn criticism as being short-sighted, it's working for FCA so far. Although the Dart and 200 aren't out of production yet and no capacity has been shifted to crossover or trucks, May's numbers show that the emphasis on Jeep and Ram models makes sense right now. FCA's US sales rose 1 percent last month compared to May 2015, putting the year-to-date total at 955,186 vehicles, an increase of 6 percent compared to the same period last year. Standouts included the Jeep Renegade, Compass, and Patriot, and the Fiat 500X. Ram pickup sales were down 3 percent. And your fun fact is that Alfa Romeo sales were up precisely 10 percent, for a total of 44 4Cs sold versus 40 in the same month last year. At FoMoCo, the Ford brand took a hit to the tune of 6.4 percent from May 2015 to 2016, registering 226,190 sales last month. Lincoln showed improvement on its modest numbers, going from 9,174 to 9,807, a 6.9 percent increase. Overall, Ford was down 5.9 percent for the month to 235,997; despite the slump, year-to-date total Ford sales are up 4.2 percent to 1,112,939. Strong sellers included Escape, Expedition, F-Series, and Transit - big stuff. Most small and/or efficient models (Fiesta, Focus, Fusion, C-Max) saw sales slides. Fusion sales were also down, likely due to effects of model changeover to the freshened 2017 model. Ford has promised four new crossovers and SUVs by 2020 and if things keep trending this way the company will be able to sell them, but things could change in the next four years. GM saw the worst of it for domestic brands. Retail and fleet sales were down for each of the four divisions, with the May 2016 total dropping 18 percent to 240,450 vehicles. GM's year-to-date sales are down 5.0 percent in 2016 to 1,183,705. Both the Sierra and Silverado were down significantly, and the majority of Chevy, Buick, GMC, and Cadillac nameplates saw sales decreases, with both small cars and larger utilities included. Not even big stuff could help GM this month, it seems. We'll have more on the rest of the industry's May sales as those figures trickle in.

2016 Chevy Volt powertrain video teasers

If there's one thing we've learned about plug-in vehicle fans, you have a thing for seeing your cars get made. The series of videos showing BMW i3 production was strangely popular, as were the shots from inside the VW e-Golf plant. Well, with General Motors pulling the veil off of the 2016 Chevy Volt this week, it's time to take a peek at the production process for that vehicle as well. You're welcome. Up first we've got a clip from CNN Money showing a little bit about how the new Volt's new battery pack and other powertrain components are made. Those of you who are trying to read the lithium tea leaves and see if the new shape reveals that the 2016 Volt will have five seats might want to check it out. Then we've got two clips from GM itself, one showing an animation about the updated Voltec powertrain and another with some B Roll of the old Volt. Since GM doesn't want us to see the new car quite yet, we'll have to enjoy this for now. Watch below. This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings. This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings. This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings.