Daimler Truck reaches deal with United Auto Workers, averts U.S. strike

(Reuters) – Daimler Truck agreed to a new labor contract on Friday with over 7,300 hourly workers represented by the United Auto Workers (UAW) at six facilities in the U.S. South, averting a strike at the 11th hour.

“For months, we said that record profits should mean a record contract with no concessions,” UAW President Shawn Fain said in a late-night appearance on YouTube from Charlotte, North Carolina, near where the company has plants.

“Our determination and solidarity has delivered,” he said of the tentative deal, which workers still must ratify.

Daimler Truck, which makes Freightliner and Western Star trucks and Thomas Built buses, had faced the possibility of a strike beginning at midnight ET (0400 GMT on Saturday).

Daimler Truck said in a statement: “The UAW members… will now be asked to vote on the new contracts, and we hope to finalize them soon, for the mutual benefit of all parties.”

The deal at the German truck maker, which was spun off from what is now automaker Mercedes, comes just three weeks before votes on whether to join the UAW will be tallied at a Mercedes assembly plant in Alabama.

Fain’s speech on Friday started almost an hour later than scheduled as Daimler Truck made late concessions, Fain explained. Several times during the talks last fall with the Detroit Three automakers – General Motors, Ford and Stellantis – the threat of a deadline led the companies to make concessions to avoid the strike’s expansion.

Under Friday’s deal, Daimler Truck workers will receive a minimum 25% general wage increase over the four-year contract, Fain said. That would match what workers at the Detroit Three received.

When the deal is ratified, Fain said members will receive an immediate 10% pay raise, followed by 3% increases six months and 12 months later.

They also will receive cost-of-living adjustments to offset inflation and profit-sharing, both for the first time at Daimler Truck, as well as the end of wage tiers that paid those building buses less than those building heavy trucks, he said.

The lowest paid workers at Thomas Built will see raises of more than $8 an hour and some skilled trades workers at that unit will see increases of more than $17 an hour, Fain said.

The deal also includes increased job security and improved health and safety benefits, he said.

About 96% of the Daimler Truck workers at four factories in North Carolina, and parts warehouses in Georgia and Tennessee had voted in March to authorize a strike.

The union had also filed unfair labor practice charges with the U.S. National Labor Relations Board against the company, citing violation of workers’ rights and federal labor laws, and for failing to bargain in good faith.

Since the deals last fall with the Detroit Three, the UAW has turned its efforts to organizing non-union U.S. plants of more than a dozen automakers.

The UAW clinched a historic victory at a Volkswagen plant in Chattanooga, Tennessee, last week, and workers at a Mercedes factory in Vance, Alabama, are going to vote on whether to join the union during the week of May 13.

Reporting by Nathan Gomes in Bengaluru and Ben Klayman in Detroit; Editing by Shinjini Ganguli and William Mallard