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Union, Chrysler intensify efforts on contract talks

Negotiators with the United Auto Workers (UAW) union and Chrysler LLC remained at the bargaining table as efforts to reach a tentative contract agreement intensified, a source briefed on the talks said.

The person, who requested anonymity because the talks are private, said they are expected to run through the weekend.

UAW reached a tentative agreement with General Motors Corp on Sept. 26, but the agreement must be ratified by a majority of GM's UAW members to take effect. Members began voting last week and are expected to wrap up votes by Wednesday.

UAW did not announce which automaker it would negotiate with next, but the person briefed on the talks said the UAW selected Chrysler as its next bargaining target and would turn to Ford last.

Ford spokeswoman Marcey Evans and UAW spokesman Roger Kerson did not return calls seeking comment on Saturday.

Chrysler spokeswoman Michele Tinson confirmed that the parties were negotiating Saturday but would not comment further.

UAW typically reaches an agreement with one automaker and then tries to get the others to match the terms.

But it was unclear whether Chrysler and Ford will match GM's agreement.

Chrysler is seeking healthcare concessions that UAW already granted to Ford and GM, for example.

Chrysler and Ford also may balk at making specific product commitments at US plants, as GM did.

Another sticking point in the talks is a UAW-managed retiree healthcare trust that GM's agreement would establish.

Under the agreement, GM would put nearly US$30 billion into the trust and pay US$5.4 billion to cover retirees' healthcare until the trust starts paying out benefits in 2010.

GM has a total of US$51 billion in unfunded retiree health costs, but it wasn't required to put that full amount into the trust. Chrysler has approximately US$19 billion in unfunded retiree health costs.

Another source briefed on the talks said on Friday that Chrysler wants to tailor the health care plan to better suit its needs and might not want to contribute as much as GM.

The trust benefits GM more than Chrysler or Ford because GM has the most retirees and surviving spouses. GM also has an older work force with more employees on the verge of retirement.

That person also requested anonymity because the talks are private.

UAW's contracts with Chrysler, Ford and GM were originally set to expire on Sept. 14.

UAW selected GM as the lead company and strike target in the negotiations and reached the tentative agreement after a two-day strike. Chrysler and Ford have been extending their contracts indefinitely.
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