By SCOTT SMITH, Kokomo Tribune staff writer
scott.smith@kokomotribune.com
Chrysler presented a new round of buyout offers Monday to Kokomo workers and United Auto Worker members companywide.
Similar to deals offered last year, the buyout offers were presented to rank-and-file, UAW-represented employees before any public announcement was made.
The offer sheet, passed out at Kokomo Chrysler plants Monday, contains only one sentence of explanation.
"Due to unprecedented conditions in our economy and industry, Chrysler and the UAW have approved an enhanced voluntary termination of employment program for this facility," the statement reads.
Like Delphi in 2006, Chrysler is widely expected to attempt to replace workers making top-tier wages with new workers coming in at around $14 an hour.
The new workers would also have less-generous retirement and health-care plans.
Chrysler faces a Feb. 17 deadline for presenting a plan to remain viable to the U.S. Treasury, as Congress readies for a second round of bailout talks.
Monday's announced buyouts represent the second time in as many years the Auburn Hills, Mich., automaker has tried to reduce its surplus production capacity through voluntary buyouts.
The new buyout offer would also serve to help Chrysler reduce some of its inventory of unsold vehicles now sitting on dealer lots, by adding an auto purchase voucher to the buyout incentives.
Chrysler officials said the company decided in December that it would offer another round of buyouts, citing "the difficult economic and market conditions in the U.S."
"The original window to offer the programs was slated to begin in December and run into January, per an agreement with the UAW," a company statement released Monday afternoon states. "Due to the fact that many of the Company's facilities had suspended production for extended periods in December and January, the program offerings are being rolled out now."
The buyouts will be offered to any hourly (skilled or non-skilled) UAW-represented employee, according to an announcement sent out by Chrysler LLC's human resources department Monday.
To be eligible, employees must be on the active roll - or on temporary or indefinite layoff - and have accumulated at least one year of seniority by Monday's date. To be eligible, employees must also have a service date prior to Oct. 29, 2007.
Terms of the offer include:
• A $75,000, pre-tax, lump-sum payment.
• A vehicle voucher for $25,000.
• Six months continued health care benefits (excluding dental), along with an option to purchase an additional 18 months.
The offer stands until Feb. 25.
In early 2008, Kokomo Chrysler workers were offered a $100,000 (pre-tax) lump-sum payment.
Company officials noted in the statement that the pre-tax value of the vehicle voucher in the 2009 buyout offer would be somewhere around $40,000.
Employees choosing to accept the offer will leave the company some time between Feb. 26 and June 30, at the discretion of management.
The announcement made no mention of how many employees Chrysler plans to separate through voluntary buyouts. The automaker operates four Kokomo plants employing about 6,300.
The company also announced a new early retirement program Monday.
Eligible employees would receive a $50,000 lump-sum payment, along with a $25,000 car voucher.
Employees accepting the early retirement would retire with "regular 'employee option' pension benefits, which are subject to early retirement age reductions," the announcement states.
The early retirement buyouts would separate in the same time frame as the other employees.
UAW Local 685 president Rich Boruff could not be reached for comment Monday.