Workers at Daimler Truck in North Carolina will receive a 25% pay hike after their union secured a last-minute agreement with the German commercial vehicle maker late Friday.
The wage increase will be spread over four years, said Shawn Fain, the president of the United Automobile Workers (UAW).
Last year, the UAW achieved increases of similar magnitude at the auto giants General Motors, Ford and Stellantis after weeks of strike action.
A strike at Daimler Truck plants in North Carolina was due to begin on Saturday without the deal.
The German company builds Freightliner lorries in the south-eastern US state as well as the well-known yellow Thomas Built school buses.
Union members still must vote to ratify the agreement, which provides for a 16% increase in the first year. More job security and profit-sharing have also been agreed, Fain said.
For the UAW, the deal marks another success in the southern United States, where labour movements have traditionally been weak. Last week, workers at Volkswagen's US plant in Chattanooga, Tennessee, decided to unionize with the UAW.
