General Motors and the United Automobile Workers union reached a tentative agreement on a new labor contract on Monday, according to two people familiar with the matter, setting the stage for an end to the union’s six-week wave of strikes against the three large U.S. automakers.
The agreement comes days after the union announced tentative agreements with Ford Motor and Stellantis on new contracts. The three deals contain many of the same or similar terms, including a 25 percent general wage increase for U.A.W. members as well as the possibility for cost-of-living wage adjustments if inflation flares.
The tentative agreement with G.M., the largest U.S. car company by sales, requires approval by a union council that oversees negotiations with the company, and then ratification by a majority of its 46,000 U.A.W. workers.
The union’s contracts with the three automakers expired on Sept. 15. Since then, the union has called on more than 14,000 G.M. workers to walk off the job at factories in Missouri, Michigan, Tennessee and Texas, and at 18 spare-parts warehouses across the country. The most recent escalation of the strike came on Saturday, shortly after the union reached a deal with Stellantis, the parent company of Chrysler, Jeep and Ram. On that day, the U.A.W. told workers to go on strike at G.M.’s plant in Spring Hill, Tenn., that makes several sport utility vehicle models.
The strike has halted the production of some of G.M.’s most profitable vehicles, including the Cadillac Escalade S.U.V., the Chevrolet Colorado pickup truck and the Chevrolet Traverse S.U.V.
G.M. said last week that the strike had lowered its earnings by about $800 million, before interest and taxes, with part of the impact coming in the third quarter and most in the fourth quarter.
For decades, the union has negotiated similar contracts with all three automakers, a method known as pattern bargaining. Like the contract it hammered out with Ford and Stellantis, the tentative G.M. deal would lift the top U.A.W. wage from $32 an hour to more than $40 over four and a half years. That would allow employees working 40 hours a week to earn about $84,000 a year.
G.M., Ford and Stellantis began negotiating with the U.A.W. in July. The companies have sought to limit increases in labor costs because they already have higher labor costs than automakers like Tesla, Toyota and Honda that operate nonunion plants in the United States.
The three large U.S. automakers are also trying to control costs while investing tens of billions of dollars to develop new electric vehicles, build battery plants and retool factories.
“We need to make sure we have a contract that is going to allow us to compete and win in what is a challenging market for E.V.s,” G.M.’s chief executive, Mary T. Barra, said on an earnings call.
