The United Auto Workers union announced that its ongoing strike against Detroit automakers will now include 7,000 additional workers at a Ford plant in Chicago and a General Motors assembly factory near Lansing, Mich. This expansion of the strike comes after negotiations with Ford and GM failed to make meaningful progress, according to union President Shawn Fain.
While negotiations continue, these two new strike locations are a result of the refusal by Ford and GM to reach an agreement at the bargaining table, Fain explained. Stellantis, the maker of Jeep vehicles, was spared from the third round of strikes.
The GM plant in Delta Township, near Lansing, produces large crossover SUVs such as the Chevrolet Traverse and Buick Enclave. A nearby metal parts stamping plant will remain open during the strike. In Chicago, the Ford plant manufactures the Ford Explorer and Explorer police interceptors, as well as the Lincoln Aviator SUV. The Explorer interceptor is the top-selling police vehicle in the nation.
Fain expressed hope for a resolution that recognizes the sacrifices and contributions made by union members over the past decade. Union bargainers are still engaged in negotiations with all three companies.
In a surprising turn of events, Stellantis made significant progress just before a Facebook Live broadcast by agreeing to certain demands from the union. These include cost-of-living pay raises, the right not to cross picket lines, and the right to strike in response to plant closures.
While Fain is thrilled with the positive developments at Stellantis, General Motors remains less optimistic. Gerald Johnson, head of manufacturing at GM, accused the union of calling strikes for the sake of generating headlines rather than making real progress.
Johnson revealed that the company has yet to receive a counteroffer from union leaders to an economic proposal made on Sept. 21. He emphasized GM’s willingness to negotiate and expressed a desire for an agreement that benefits the workers and prevents non-union manufacturers from gaining an advantage. According to Johnson, GM’s counteroffer represents a record proposal with substantial wage increases and job security measures.
Ford has scheduled a briefing by CEO Jim Farley to discuss the ongoing talks, indicating the importance the company places on finding a resolution.
The automakers have expressed a willingness to provide wage increases but are concerned about the impact on vehicle prices. They fear that excessively high labor costs could cause their vehicles to be more expensive than those manufactured at nonunion plants operated by foreign automakers, primarily in the southern United States. However, the union argues that labor costs account for only a small percentage of the total vehicle cost and that the companies can afford significant raises given their substantial profits.
Industry analyst Dan Ives suggests that the expansion of strikes by the union indicates a prolonged battle between both sides. He notes that the current offers on the table could result in increased costs for electric vehicles, potentially undermining the automakers’ future business models.
The union has made it clear that it will escalate its actions if it doesn’t receive improved contract offers. This simultaneous labor campaign against all three Detroit automakers is unprecedented. Additional walkouts were scheduled to begin at noon on Friday.
Initial wage offers from the automakers were approximately 20% over the course of a four-year contract, which falls short of the union’s demands. Other contract improvements, such as cost of living increases and retirement benefits for newly hired workers, as well as an end to wage tiers within the union, are also being negotiated.
The UAW initiated the strike on Sept. 15 when it failed to reach new contract agreements with the companies. As of now, around 25,000 of the union’s 146,000 workers are on strike, allowing the union to preserve its strike fund.
If all of the union’s auto workers were to strike, the fund would be depleted in less than three months. This timeline does not even account for healthcare costs.
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