Stellantis, UAW reach tentative agreement at engine parts plant after weekend strike

More than 1,000 union members at Stellantis' castings plant in Kokomo, Ind., went on strike Saturday after contract negotiations broke down, but the union and management reached a tentative agreement on a new local contract early Monday.

Union members remained off the job Monday until ratificaiton votes were completed, a UAW spokeswoman said. A prolonged strike at the operation would likely threaten Stellantis vehicle production in North America.

“The bargaining committee stood strong with the support of the striking UAW Local 1166 members to win an agreement that will correct the poor working conditions,” UAW President Ray Curry said in a statement. “This tentative agreement is a testament to UAW solidarity. Their working conditions will greatly improve, and they have given us all inspiration to fight for justice and respect in our workplaces.”

UAW Vice President Cindy Estrada said in the union statement: “The environment in the plant has deteriorated over the years due the company’s decision to save money by not properly maintaining or providing the proper HVAC in the plant. The bargaining committee also fought hard to win dozens of demands that the members had submitted. This agreement will address these and many other issues that will benefit the Local 1166 members.”

UAW Region 2B Director Wayne Blanchard said Local 1166 members "have shown that the membership of the UAW will push back when the company shows little regard for how their employees are treated.”

Neither the UAW nor Stellantis dislosed details about terms of the agreement.

"Stellantis confirms that the company and UAW Local 1166, representing the workers at the Kokomo, Indiana, Casting Plant, have reached a proposed tentative agreement on a new local contract," Stellantis said in a statement. "As the tentative agreement still needs to be ratified by the workforce, we will not comment further." 

The Stellantis website said the plant is the largest die-cast facility in the world and makes engines and transmission parts.

The walkout was another sign of the tension between automakers and the union as the industry shifts to electric vehicles. Stellantis and South Korea’s Samsung SDI Co. announced in July they’re investing $2.5 billion to build a battery plant in Kokomo. The union is worried about protecting jobs at combustion-engine parts factories and wants to ensure that workers who make batteries have UAW representation and comparable wages and benefits.

The Kokomo castings plant makes parts for multiple vehicles, said Jeff Schuster, senior vice president of forecasting for LMC Automotive. Since carmakers keep a minimal parts inventory the walkout could shut down assembly plants quickly, but the strike probably won’t last long, he said.

“After bargaining in good faith for two days and presenting an offer we believed addressed the union’s concerns, we are disappointed by the UAW’s decision to walk out,” Stellantis said in an emailed statement on Saturday. “We will look to get back to the table as soon as possible to resume negotiations to reach an agreement on a local contract.”

In August, Stellantis said it would invest $99 million in Kokomo Casting and two other parts plants to make new hybrid engines.

Philip Nussel of Automotive News and Bloomberg contributed to this report.