UAW says it has accord with Chrysler, Fiat , U.S.

The UAW said it reached a labor agreement with Chrysler LLC, Fiat S.p.A. and the U.S. Treasury Department.

The deal will alter Chrysler's financial obligations to the union's retiree health-care plan, a concession that could allow the automaker to avoid bankruptcy. Separately, Chrysler said that its Canadian workers have ratified a concessionary agreement reached Friday.

The UAW accord will also help Chrysler meet a Thursday U.S. deadline for forging an alliance with Fiat to qualify for additional rescue loans. Chrysler is still negotiating with its creditors.

"We recognize this has been a long ordeal for active and retired auto workers, and a time of great uncertainty," said UAW President Ron Gettelfinger in a statement. "The patience, resolve and determination of UAW members in these difficult times is extraordinary, and has made it possible for us to reach the agreement."

The union said workers must ratify the deal by Wednesday. No details were offered.

The CAW said its members voted 87 percent in favor of a new collective agreement with Chrysler that will save the company about C$240 million ($198 million) in annual savings.

The union made the concessions in order to try to help the teetering company qualify for billions of dollars in government aid in Canada and the United States.

"Our members understand better than anyone the current turmoil of the domestic auto industry," said CAW President Ken Lewenza.

"The high acceptance of this agreement is a recognition that although workers did not cause this crisis, we all have an interest in maintaining good jobs and ensuring the auto industry remains central to the overall Canadian economy."

Reuters contributed to this report.

By Automotive News