Way back in early 2022, Tesla CEO Elon Musk threw down the gauntlet and literally dared the UAW to attempt unionizing his workforce: “I’d like hereby to invite UAW to hold a union vote at their convenience. Tesla will do nothing to stop them.”

Let’s say that the autoworker landscape has shifted since then, and Musk’s gauntlet has now been thrown back at him by UAW President Shawn Fain. How did we get here? 

The answer is complicated. Going into November 2023, the UAW has declared triumph in a six-week strike against the Big Three. Fain celebrated with a series of bombastic remarks. He vowed “organizing like we’ve never organized before.” He added that when it comes time for 2028 contract renewal, “it won’t just be with a Big Three, but with a Big Five or Big Six.” 

There’s also no secret of who’s next on UAW President Fain’s list: Tesla. 

If this feels like it’s happening fast, well, it is. Yet Fain is feeling emboldened by a new wage paradigm and restored COLA benefits for UAW members. This week, GM became the last of the Big Three to reach a tentative contract. Then word arrived that an official organizing committee formed at Tesla’s Fremont, CA factory. Yes, the UAW will partially fund that effort. 

While it wasn’t initially announced, the tentative agreements with the Big 3 do, in fact, contain a pathway for the UAW to gain access to EV battery plants, a major objective. We’ll have more on this tomorrow, but it seems this is part of a longer-game plan targeting Tesla and other auto companies. It’s food for thought, but what seems more obvious is that Fain has been leading a very public crusade against the “billionaire class,” and there’s no bigger billionaire in our current world than Elon Musk. 

Some recent background: Tesla was seemingly positioned well against the UAW strikes and even stood to benefit from them. Tesla also remains the market-share leader in EVs, but that market doesn’t hold as much promise as it recently did. Rising finance costs and automakers’ inability to drive down EV costs have led to sharply dropping demand. Tesla shares have taken a 34% nosedive since the start of the UAW strike. That fall is comparable to Big Three shares, true, but it’s not great leverage for Tesla, given that workers’ stock options have been seen as a huge perk. 

Also notable: The NLRB and Tesla are often at odds. The board even once instructed Musk to delete an anti-union tweet. Tesla has also been accused of purposefully laying off union supporters but maintained that these layoffs were over poor performance. However, at least three attempts at organizing Tesla factories by the UAW and SEIU previously failed.

Clearly, Fain desperately wants to grow the UAW back to its so-called “glory days.” Membership has drastically fallen from 1.5 million members to around 380,000, and nowadays, around half of UAW members aren’t even autoworkers. Heck, one-quarter of them work in higher education. Fain, obviously, would love to harness another 120,000 autoworkers. He’s gotta build that strike fund back up somehow, man!

Tesla might be the canary in the coal mine here, but this could portend a wider trend. Toyota and Honda are certainly watching. So are we.

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