The United Auto Workers union said Tuesday it had reached a “tentative” agreement with struggling automakers General Motors, Chrysler and Ford to help the companies cope with dire economic conditions. The union said the deal will allow the Detroit Three automakers to modify their 2007 labor contract but did not provide any details. It said “discussions are continuing” regarding health care benefits. GM and Chrysler were required to reduce labor costs as part of the terms of a $17.4 billion government bailout package. Ford has said it has sufficient cash reserves to survive the downturn without government aid but was also granted the concessions because the union maintains similar contract at each of the Detroit Three. “The changes will help these companies face the extraordinarily difficult economic climate in which they operate,” union president Ron Gettelfinger said in a statement. “The UAW is withholding the terms of the tentative understanding pending completion of the (health care) discussions and ratification of the agreements.” Industry-wide losses Daimler swung to a hefty loss, hit by exposure to Chrysler, and Opel and Saab braced for news of General Motors' survival plan, as European carmakers saw their fates tied closely to their US peers. As GM and Chrysler put the finishing touches to blueprints showing how they will pay back billions of dollars of government loans, Chrysler's German ex-owner Daimler said its remaining 19.9 percent stake in the Detroit-based manufacturer had driven it to a steepling fourth quarter loss. The premium carmaker also forecast the global recession ravaging the industry would slash auto demand by about 10 percent this year, pushing down revenue and forcing it to cut its 2008 dividend. Acknowledging that industry conditions are worse than expected when it made the case in December for a government bailout, Chrysler requested an additional $5 billion in government loans. It originally said it would need $3 billion more. The company had previously received $4 billion from the Treasury Department. The plans still have to be vetted by Treasury and the new autos task force announced by the Obama administration Sunday night. The news came on a day when President Barack Obama signed into law a massive economic recovery plan.
