Mitsubishi Motors North America said today that it will not meet a contractual deadline to allocate a new vehicle for its assembly plant in Normal, Ill.
As a result, the automaker must increase the base wages of the UAW-represented work force at the plant.
Under the terms of Mitsubishi's 2008 collective bargaining agreement with the plant's UAW employees, the company had until today to tell the union what new vehicle or vehicle platform it planned to build at the plant.
If no product is allocated, the terms of the agreement state that base wages at the plant must return to about $25.60 per hour from the current $24, said Ralph Timan, president of UAW Local 2488.
Last Thursday, Aug. 26, members of Local 2488 voted down an amendment to extend the deadline beyond today, according to the local's Web site.
“We are disappointed with the results of this vote,” Mitsubishi said in a statement. “Mitsubishi Motors Corp. remains concerned at the slow pace of economic recovery in the United States and current sales projections for the U.S. market.
“As a result, MMC is unable to announce a new model for assembly at MMNA at this juncture. In response to today's unfortunate development, MMNA is exploring its options.”
Mitsubishi spokesman Dan Irvin declined to comment further.
The Illinois plant currently builds the aging PS platform, which underpins the Mitsubishi Galant, Endeavor, Eclipse and Eclipse Spyder sold in the United States.
Those vehicles used to account for the bulk of Mitsubishi's U.S. sales, but volumes have fallen precipitously as those vehicles have aged.
Through July, Mitsubishi's U.S. sales of domestic-made cars are down 2 percent and its total U.S. sales have risen 3 percent compared with the same seven months of 2009. Industrywide U.S. vehicle sales are up 15 percent.