- Unprecedented Strike Hits Three Major US Automakers
- Dispute Over Labor Agreements Threatens Industry Disruption
- Demands and Economic Impact of the Strike
Three of the largest automakers in the United States have gone on strike in an unprecedented coordinated action.
More than 10,000 employees are participating in the strike, which affects three General Motors (GM), Ford, and Stellantis facilities.
Companies and the United Auto Workers (UAW) union are at odds over the terms of new labor agreements.
The work stoppage threatens to result in higher automobile prices and significant disruption for the automotive industry’s titans.
As the current contract expired on Thursday, the UAW’s president Shawn Fain said it was now up to the companies to resolve the dispute.
“It will end when they start taking care of their employees,” he said.
The strike began at midnight Eastern time (04:00 GMT) at GM’s mid-size vehicle plant in Wentzville, Missouri, Ford’s Bronco plant in Michigan, and Stellantis’s Jeep plant in Toledo, Ohio.
The facilities are essential to the production of several of the “Detroit Three’s” most profitable automobiles.
Other UAW facilities will continue to operate, but the strikes may be expanded beyond the first three targets.
A simultaneous strike against all three companies is unprecedented in the union’s history.
As Thursday’s deadline approached, the White House reported that President Joe Biden had discussed the negotiations by phone with Mr. Fain, but provided no additional information. Mr. Biden addressed the action in his Friday remarks.
The union wanted a 40% wage rise for its 140,000 members over four years, citing industry leaders’ increases.
Other conditions included:
- a business week of four days
- The return of inflation-based automatic compensation increases
- Greater restrictions on the length of time workers can be deemed “temporary” without receiving union benefits.
As of Wednesday, the three companies’ proposals had been enhanced to include up to a 20% pay increase.
After years of record profits, workers asserted that firms could afford to be more generous.
Paul Raczka, an employee at a Stellantis plant in Michigan that manufactures Jeep Grand Cherokees, stated, “We are entitled to this.”
Mr. Raczka, the fourth generation of his family to work in the industry, stated that such jobs, which included excellent healthcare and secure pensions, had afforded his parents an “awesome living” – a way of life that no longer seems feasible.
The 31-year-old claimed he could not even afford to purchase the automobile he manufactures.
“We are still on the back burner while these CEOs earn more than $20 million per year,” he said.
General Motors CEO Mary Barra, who earned $28 million last year, called the offer “historic.”
She predicted that the UAW would demand over $100 billion when the corporation needed to invest in new technology.
“We must ensure the company’s success for the next 115 years,” she said in an interview with CBS, adding that the company was continuing to negotiate in an attempt to resolve the differences.
According to estimates by the Anderson Economic Group, a 10-day strike by all 140,000 employees could cost the three companies nearly $1bn (£800m) and the employees nearly $900m in lost salaries. It was stated that the cumulative economic impact could exceed $5 billion.
Vice-president of the company Tyler Theile stated that a suspension would have to be “pretty lengthy” to affect national economic indicators, but warned that the local impact will be significant.
Since the pandemic-related components shortage, car supply was much lower before the strike.
According to analysts, a prolonged strike could also result in higher prices for consumers.
Ford, GM, and Stellantis account for approximately 40% of U.S. automobile sales, but their market share has decreased dramatically over the past quarter century as foreign companies such as Toyota make inroads.
The last strike in the auto sector was GM’s six-week strike in 2019.
GM boycott participant Jessie Kelly said she was saving money for future strike.
Participants of the UAW are scheduled to receive $500 per week in strike benefits from the union, but she stated that the amount would still be substantially less than her weekly salary.
“My strike pay is insufficient to cover my mortgage, let alone my grocery bill, my electric bill, and everything else. Therefore, it will be a struggle,” she stated.
Ms. Kelly, who resides near Detroit, stated that she supported the fight despite the cost, noting that her salary has not kept up with inflation and is rapidly consumed by childcare and housing costs. The 33-year-old stated that she had only two weeks of vacation per year, which she had to use for exigencies.
“At the end of the day, we all desire to work for a profitable corporation. We simply want our fair portion,” she stated.
“The CEOs are gonna keep paying themselves more and more money and we’re the only ones being left behind.”
