NAfter the end of the strikes in the American auto industry, the UAW union feels strengthened for future conflicts – and senses an opportunity to significantly expand its territory. It rates the collective agreements it has concluded with the manufacturers General Motors, Ford and Stellantis, known as the “big three”, as “historic” and wants to use them to establish itself with other companies.
Its president, Shawn Fain, has confidently said that he will no longer conduct the next collective bargaining negotiations in 2028 only with the “big three”, but with the “big five or big six”. The UAW will be more aggressive than ever in trying to unionize manufacturers where it does not yet have a presence. These include the electric car manufacturer Tesla and the US branches of the German manufacturers Volkswagen, BMW and Daimler.
Musk is not a union fan
Tesla CEO Elon Musk is an outspoken opponent of unions. The plants of the German suppliers and also some Asian companies are in southern American states where unions have traditionally been weakly represented. But after the successes in the labor dispute, the UAW hopes that its recruiting efforts with these manufacturers will find more fertile ground than in the past. Fain has described employees of companies like Tesla and Toyota as “future UAW members.” According to a report from the Bloomberg news agency, UAW representatives are already talking to employees at the Tesla factory in Fremont, California.
The UAW looks back on difficult years. At its peak in 1979 it had 1.5 million members; at last count it was around 400,000. Efforts to establish itself among other automakers beyond GM, Ford and Stellantis failed. Almost a decade ago, she came very close to unionizing the employees at the VW plant in Tennessee, but ultimately failed to find a majority in the workforce. A few years ago, an attempt to move into Tesla also failed.
The collective agreements concluded with GM, Ford and Stellantis now give Fain arguments for new mobilization attempts. The UAW boss entered the talks with extremely ambitious ideas, including an increase in wages by more than 40 percent within the next four years. Although he was unable to achieve this maximum demand, the wage increase of around 25 percent that was negotiated in the end is also considered a great success for the UAW. The union points out that all previous collective bargaining negotiations between 2001 and 2022 resulted in increases of 23 percent, meaning that this was exceeded in a single round of negotiations.
“Every last dime”
In addition, the UAW was able to extract a number of other concessions from manufacturers, such as inflation adjustments and the abolition of a pay system that gave new employees significantly worse conditions than existing employees. The UAW was also able to negotiate that the company’s battery plants, which become more important as the production of electric cars increases, would be covered by the collective agreements. After the UAW announced its agreement with GM on Monday, Fain triumphantly said he had squeezed “every last dime” out of the company.
Collective bargaining talks with GM, Ford and Stellantis began in July. Fain took a confrontational course from the start, and in mid-September he called a strike at all three manufacturers. He had a powerful ally in the White House, President Joe Biden traveled to one of the locations on strike and expressed his solidarity with the employees. In total, the strike has now lasted more than six weeks and it has become expensive for the manufacturers. Ford has said the labor dispute cost the company $1.3 billion. The manufacturer also estimates that its labor costs per car will now increase by an average of $850 to $900 as a result of the commitments made in the collective bargaining agreements.
This puts GM, Ford and Stellantis at a possible competitive disadvantage compared to manufacturers that are not yet unionized. However, according to observers, such companies will now also be forced to improve the conditions for their employees. Otherwise, they could become even more vulnerable to attempts by the UAW to establish itself among them.
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