UAW union President Shawn Fain angrily discarded contract offers from Stellantis (NYSE:STLA) Tuesday as he discussed the extensive concessions that the Chrysler parent company is aiming to secure during their negotiations over labor matters.
Fain called the proposals “a slap in the face” during an online chat meeting, revealing that the company is suggesting reductions in healthcare benefits, a decrease in vacation days for new employees, employer-initiated reductions in 401(k) contributions, and the removal of limits on temporary employee hires.
"The management's actions can only be seen as a deliberate affront to us."
Based on a document seen by Reuters, a significant portion of Stellantis' propositions are focused on reducing absenteeism, a factor that the automaker claimed resulted in the loss of over 16,000 vehicles in production, amounting to a revenue loss of $217 million.
Additionally, Stellantis aims to decrease expenses related to pensions, healthcare, and other aspects, saying that amid government electric vehicle rules, it "is imperative we find ways to reduce the overall fixed cost structure of our business."
Stellantis claims the cumulative increase in employee healthcare costs over the next four years is expected to be $613M.
The UAW is pursuing salary increases of 40% spanning a four-year period, extra time off, and the reinstatement of defined-benefit pensions that were previously removed for newer employees.
The current contracts with Stellantis, General Motors Company (NYSE:GM), and Ford Motor (NYSE:F) expire on Sept. 14.
"The clock is ticking - time to get down to business," warned Fain.
Shares of STLA, GM, and F are down 0.67%, 0.95%, and 1.09% in early trading Tuesday morning.