A strike by the ‘Big Three’ autoworkers is about to start
“We’re gonna have to give up on us,” UAW spokesperson Tommy Fain told reporters after the strike on Big Three automakers
For the first time ever, the United Auto Workers union is striking against all Big Three automakers at once, after it failed to clinch a deal on a new contract by the 11:59 p.m. deadline on Thursday.
A gradual escalation of the strikes across the three companies, Fain said, would keep Stellantis, Ford and GM on their toes about how their operations would be disrupted, giving the union more leverage.
Workers at three plants — a GM assembly plant in Wentzville, Missouri, a Stellantis assembly plant in Toledo, Ohio, and part of a Ford plant in Wayne, Mich. — would be among the first to walk off the job under Fain’s new strike strategy.
“It’s going to keep (the companies) guessing on what might happen next, and it’s going to turbocharge the power of our negotiators to be as effective as possible,” Fain said.
“We’re living in a time of stunning inequality throughout our society,” Fain said. “We’re living in a time where our industry is undergoing massive transformations, and we’re living in a time where our labor movement is redefining itself.”
Ford, General motors and Stellantis have all raised their proposed pay raises, but only to 20% of the union’s demand.
The companies have rejected the union’s proposals for their pension and healthcare. Cost of living adjustments and profit sharing are two points of contention.
“We do not have offers on the table that reflect the sacrifice and contributions our members made to these companies,” Fain told union members. We’ll likely have to take action in order to win.
A strike plan has never been in the UAW’s wheelhouse. Historically, UAW strikes have involved all union members at a single company walking off the job at once.
“If we signed up for the UAW’s requests…we would’ve lost $15 billion and gone bankrupt by now,” Ford CEO Jim Farley told CNBC on Thursday. “There’s no way we can be sustainable as a company.”
Regardless of how the negotiations progress over the next 24 hours, he will attend the Detroit rally with other UAW leaders.
A prolonged strike poses a potential threat to the U.S. economy. In a scenario in which all of the about 150,000 UAW auto union members were to strike for six weeks, the impact on the economy would amount to shaving an estimated 0.2% off fourth-quarter GDP.
The majority of the EV factories that are coming online in the US are not unionized. Workers at a GM joint venture battery plant in Ohio overwhelmingly voted to unionize last December.
Meanwhile, the Big Three are pumping billions of dollars into EVs in a race to catch up with Tesla, which employs a nonunion workforce. These investments are being subsidized by the Biden administration, which has put EVs at the center of its efforts to fight climate change.
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It’s pretty likely! According to analysts at Evercore ISI and Wedbush Securities, there’s about 85 percent of a strike at all three companies. The wage increase proposal the union made was 36 percent, down from 40 percent, which seems to suggest negotiations are still ongoing. The two sides are not far apart on most issues.
In the past, the UAW has demanded the auto industry’s profits and pay disparity between top execs and rank-and-file union members.
The UAW’s 150,000 members didn’t favor the union’s previous leaders for cutting deals with the automakers, according to Fain.
The cost gap between themselves and non union factories owned by foreign automakers in the South is their main issue. They say this puts them at a disadvantage because they spend $65 to $68 an hour on total labor costs, including benefits, while their rivals only spend around $55 an hour.
Meanwhile, Tesla incurs labor costs of $45 to $50 per hour for its nonunion workforce. The Big Three argue this is why they’ve struggled to keep up with Tesla, which still commands around 60 percent of the EV market in the US.
The union claims that the three companies will not provide enough wage protection to keep up with inflation in the next four-and-a-half years, despite having cost of living protections on the table.
The New York Times said that, in an internal memo, Fain referred to the shift to EVs as a race to the bottom.
The owner of a car dealership that uses a fake name wrote about hoping this would get resolved before it gets to that point. “But tbh, I highly doubt it.”
Fight against the crony capitalism: The cost of not doing anything for the United Auto Workers’ Association (UAW) announcing its September 8th Facebook Live event
When portraying the costs of a strike, it is important to note that it has an effect on the state and nation’s economic output. It is believed that a ten-day strike would affect the US gross domestic product by $5.6 billion and push the Michigan economy into a recession.
The union says the cost of not doing anything is higher. “Corporations want us to believe there’s nothing we can do to stop our race to the bottom,” Fain said in a Facebook Live video on September 8th. When our labor is not appreciated, we have the power to refuse it. We have the fundamental power of a strike. The cost of doing nothing is much higher than the cost of a strike.
Additional locations would follow at a moment’s notice, depending on how bargaining with the companies progresses — a strategy intended to ramp up the pressure on companies by keeping them guessing about how their operations would be disrupted.
The UAW had a Facebook Live event Thursday night where Fain spoke about his generation’s defining moment. The world is watching the cause because of the money that is there.
He’s doubled down on the union’s demands, including 40% pay raises, as well as cost of living adjustments and restoration of pension and retiree healthcare.
The Big Three have the Power: Negotiating For Their Own Interests, Their Own Profits, And Theirs. GM’s Deal With the UAW’s First Strike
Collectively, the Big Three automakers have seen their profits soar during the pandemic when factors including parts shortages led to surging car prices, padding the profit margins of companies.
He compared the companies’ profits to those of autoworkers’, which increased just 6 percent in four years.
But the companies say they’ve made genuine attempts to reach agreements. General Motors attempted to head off a strike with a down-to-the-wire offer on Thursday afternoon, a proposal CEO Mary Barra called a “compelling and unprecedented economic package.”
In spite of the rhetoric from the UAW leadership, GM’s latest offer addresses what they’ve told them is most important to them.
More than 2,000 workers have gone on strike this year in the U.S. according to data from the Cornell University School of Industrial and Labor Relations.
In July, the union secured a 50% average total wage increase over the course of the five-year contract for existing part-time workers, an increase that followed months of contentious negotiations.
In August, the Allied Pilots Association, which represents 15,000 American Airlines pilots, successfully pressured the airlines to increase pilots’ pay by more than 46% over four years.
The Big Three cars were the choice of many Americans. But today, the market is populated with foreign automakers such as Toyota and Volkswagen, which are not being impacted by strike threats and can continue to produce cars at a steady clip.
“They don’t have exceptional leverage because there’s a lot of competition,” said Harry Katz, a professor of collective bargaining at Cornell University, referring to automakers’ ability to shift production to the non-union South or abroad.
The first to walk off the job under UAW president Shawn Fain were the workers at three Midwest auto plants.
