Business: Peace for Three Years

The auto industry virtually assured itself of three years of labor peace last week. After a quickie (six hours) walkout, Chrysler signed the standard three-year contract with the U.A.W. embodying the Reuther version of the guaranteed annual wage. Like Ford and G.M. before it, Chrysler agreed to establish a fund to guarantee its 139,000 employees 65% of their regular pay for 26 weeks. It also promised minor raises for increases in efficiency and the higher cost of living. Cost to Chrysler: an estimated 20¢ an hour per employee, about the same as at Ford and G.M.

The next day, 22 hours after its workers went on strike, American Motors (Nash, Hudson) became the first of the Little Three (others: Willys, Studebaker-Packard) to sign a pact with a guaranteed annual wage. But struggling American, which currently produces 2.3% of the industry output, won important concessions at the last minute. It will not begin payments into the special G.A.W. trust fund until Sept. 15, 1956, more than a year after the Big Three, will thus save 5¢ an hour on 24,000 workers during the pact’s first year.