DaimlerChrysler AG and the United Auto Workers union will set up a program to encourage many of its skilled-trade workers to take early retirement, as one of a variety of efforts to cut its labor costs.
Chrysler spokesman Michael Aberlich confirmed the buyout plan yesterday but added that it is too early to put numbers on the buyout. The company targeted 5,000 of its 12,000 highly paid skilled workers for buyout deals worth $70,000, a Detroit newspaper reported yesterday.
Chrysler and the UAW, who signed a new four-year labor pact yesterday, will establish a task force by Nov. 1 to discuss employment issues, but deciding how buyouts will be offered will take a few months, Mr. Aberlich said.
The skilled trades workers, who include electricians and millwrights, make about $79,000 a year. The UAW represents about 58,000 Chrysler workers, including 1,780 at the Toledo Machining Plant in Perrysburg Township. The 4,400 UAW members at the Toledo Jeep Assembly Plant are covered under a separate contract that is under negotiation.
The program is expected to begin in the first quarter of 2004.
A UAW spokesman declined to comment.
Chrysler, which hopes to post a break-even year in 2003, is under the gun to cut costs after losing more than $1 billion in the second quarter. The company has said that under the new UAW contract it expects to eliminate jobs by closing or selling nine plants. That could affect as many as 12,000 workers.