The United Auto Workers Union (UAW) will go through with threats to strike against the Big Three automakers — Ford, General Motors and Stellantis — after both sides failed to reach a deal. This is the first time in history that all three automakers have been hit by strikes at once.
The automakers and the UAW had until 11:59 p.m. Thursday evening to come to an agreement. Now, the UAW will call on its 150,000 union members to strike at plants across the country.
“We will not strike all facilities at once. We will strike all three companies, a historic first, initially at a limited number of targeted locations that we will be announcing,” said UAW President Shawn Fain during a Facebook Live event Thursday evening.
Union members were prepared with picket lines and signs once the clock struck midnight. The first three plants that are being hit are GM’s truck and van plant in Wentzville, Missouri; Ford’s Ranger pickup and Bronco SUV plant in Wayne, Michigan; and Stellantis’ Jeep Wrangler and Gladiator plant in Toledo, Ohio. In total, that’s 12,700 workers — 3,600 at GM, 3,300 at Ford and 5,800 at Stellantis — who will go out on strike at those plants.
Fain called this tactic a “stand up strike,” where the goal is to “keep the companies guessing,” relying on “discipline, organization and creativity.”
“A stand up strike begins with all our locals from parts distribution centers to assembly plants, maintaining a constant strike readiness,” said Fain. “…based on what’s happening in bargaining, we’re going to announce more locals that are going to be called to stand up and strike. These locals will join those that are already on strike, so that our strike at each company will continue to grow over time.”
While Fain said a full-on national strike is not yet off the table, he urged workers not to strike until they had been given the order by their local union leaders. Fain stressed that union members would be working under an expired agreement, not an extended agreement.
“The stand up strike is our generation’s answer to the sit down strikes of the 1930s,” said Fain. “It is long past time to stand up for the working class, to stand up for our communities and to stand up against unchecked corporate greed.”
The strike is expected to cause economic disruption for weeks. According to Anderson Economic Group, a work stoppage of 10 days could result in an economic loss of more than $5 billion. It could also lead to higher car prices going forward.
Ford said it had submitted four proposals to the UAW since August 29, calling its last offer “historically generous” with a 20% wage increase, cost of living adjustments, more paid time off and additional retirement contributions.
“Unfortunately, the UAW’s counterproposal tonight showed little movement from the union’s initial demands submitted August 3. If implemented, the proposal would more than double Ford’s current UAW-related labor costs, which are already significantly higher than the labor costs of Tesla, Toyota and other foreign-owned automakers in the United States that utilize non-union-represented labor,” reads a statement from Ford.
As traditional automakers make the switch to electric vehicles, they are struggling to avoid incurring losses. At the same time, they have to compete with the likes of Tesla, which has a non-unionized workforce.
“Ford has bargained in good faith in an effort to avoid a strike, which could have wide-ranging consequences for our business and the economy. It also impacts the very 57,000 UAW-Ford workers we are trying to reward with this contract,” continues Ford’s statement. “Our hourly employees would take home nearly 60% less on average with UAW strike pay than they would from working. And without vehicles in production, the profit-sharing checks that UAW workers could expect to receive early next year will also be decimated by a significant strike.”
GM said it was disappointed in the UAW’s actions but will continue to bargain in good faith to reach an agreement as quickly as possible.
Stellantis said it “immediately put the Company in contingency mode and will take all the appropriate structural decisions to protect our North American operations and the Company.” The automaker did not elaborate on what “contingency mode” entails.
What UAW wants versus what automakers offered
The UAW wants to eliminate wage tiers, which pay different rates per hour. They asked for a 90-day progression to top rate, restoring pensions and retiree healthcare.
Ford, GM and Stellantis proposed a four-year progression and rejected the union’s pension and retiree healthcare proposals. GM proposed to continue what UAW said is substandard pay for CCA (Customer Care and Aftersales) and GMCH (GM Components Holding) workers. The union said the same for Stellantis for Mopar, which is the parts, service and customer care division of the former Chrysler Corporation.
The union demanded significant double-digit pay raises “to match salary increases of Big 3 CEOs, catch up with inflation and make up for decades of failing wages.” Workers are also demanding a shortened 32-hour workweek, while keeping pay at a 40-hour level.
Both Ford and GM offered a 20% increase over four and a half years, and Stellantis offered a 17.5% increase over the same time period. The UAW said these offers barely make up for minimal past raises combined with high inflation, and they don’t safeguard against future inflation.
Cost of living adjustment (COLA)
UAW demanded a COLA that would allow wages to keep up with inflation and help workers improve their quality of life. The union called all three proposals deficient. Ford’s would restore an old COLA formula, but would provide estimated wage protection of less than $1 over the next four and a half years. The proposals from GM and Stellantis, UAW said, would provide no wage protection. Stellantis also offered lump sum payments, but UAW said most employees wouldn’t receive those.
The autoworkers’ union demanded that companies give workers $2 for every $1 million spent on share buybacks, special dividends and increases to normal dividends.
“Again, if they’ve got money for Wall Street, they sure as hell have money for the workers making the product,” said Fain.
The Big Three all offered some version of concessionary profit-sharing formula that UAW says would leave more for company executives and rich stakeholders and less for workers. Ford’s proposal would have resulted in 21% smaller checks over the last two years, and GM’s would have resulted in a 29% smaller check than last year, according to the union.
“As far as temps go, we’ve proposed ending the abuse of so-called temps who were exploited at low wages for years at a time and denied the full benefits and wages despite working endless hours to keep these companies going,” said Fain. “Temporary workers should be converted to full time after 90 days with full-pay benefits and profit sharing.”
Ford came to the table with a proposal to convert all current temps with 90 days of continuous service to full time in-progression. GM and Stellantis proposed an increase of wage to $20 per hour.
Job security, work-life balance and retirees
The union asked for job security with Working Family Protection Program and the right to strike over plant closures in other areas. All three automakers rejected those proposals, according to UAW. Stellantis went a step further and proposed the unilateral right to close and sell 18 facilities, including various assembly and powertrain plants and parts depots.
When it comes to work-life balance, the workers want more paid time off and holidays. The UAW said all three automakers rejected most of its demands. However, they did accept adding Juneteenth as a paid holiday. Ford also proposed two weeks of parental leave.
The union demanded a “significant increase” to retiree pay, which was rejected by all three automakers.
‘Strike these companies in a way they’ve never seen before’
On Thursday night, Fain said the UAW was “preparing to strike these companies in a way they’ve never seen before.
He called the negotiations a “battle of the billionaire class against everybody else.”
Senator Bernie Sanders has come out in support of the labor movement, speaking on MSNBC Thursday about the emotional wake-up call of the COVID-19 pandemic. He pointed out that white-collar workers were able to stay at home and work behind their computers, while many working-class people had to go out to work and risk their lives. At the same time, the pandemic saw an explosion of wealth increases for the people at the top, said Sanders.
“No one thinks that three people on top should own more wealth than the bottom half of American society, that CEOs are making 400 times more than their workers,” said Sanders. “That’s not what this country is supposed to be about. That’s what the UAW is telling the American people and I think this massive support for what they’re trying to do.”
This story is developing. Check back in for updates.