Detroit –The NV CEO for Fiat Chrysler Automobiles (FCA), Sergio Marchionne canceled his scheduled appearance at the International Motor Show in Frankfurt, Germany, to focus on narrowing a contract with the United Automobile Workers (UAW) union before facing a strike.

Just hours away from facing a strike in Fiat Chrysler’s U.S. plants, Marchionne has decided to stay in Detroit and meet the demands of the UAW before the Monday midnight deadline set in the previous contract.

Between the three Detroit automakers: Fiat, Ford and General Motors, Fiat was chosen as the lead bargaining company by the UAW. Which means whatever deal reached on Monday will dictate the wages and benefits of 141,000 jobs with the United Auto Workers union and will serve as a template for Ford and General Motors.

Marchionne is the chief architect of Fiat’s buyout of the Chrysler Jeep group. Him and his team orchestrated the whole thing in order to help Fiat re-enter the US market, as well as to give the Italian group better access to the premium segment where Chrysler and Jeep play quite nicely at the moment. Credits: in4ride

Meanwhile, the UAW has agreed to extend the negotiations deadline beyond the midnight deadline for Ford and GE.

“Although we have been meeting for months now, there are still many items of importance to be reconciled […] the current four-year contract is due to expire tonight. It is our goal to structure a new agreement for your approval.” UAW Vice President Norwood Jewell, in a message to Fiat Chrysler members.

For the United Auto Workers union, Fiat was the logical lead choice since the company is currently facing a lawsuit and a possible strike that makes it strongly interested in ending a two-tier wage structure imposed after the auto industry collapsed in the wake of the 2008 financial crisis.

The union’s demands

The UAW are looking to help automotive companies in Detroit to survive the economic crisis by loosening up on the demands. David Williams, UAW’s President proposed to end the two-tier system according to which newest workers are paid significantly less than long-term ones.

Also, seniority workers have not seen a wage increase since 2006 but have lost their purchasing power in almost 4% to inflation through the years.

Source: The Wall Street Journal