The Teamsters’ recent “historic” contract “win” against UPS isn’t truly that much of a win. Still, Big Labor feels emboldened by the dustup, and UAW President Shawn Fain is flexing even harder over the ongoing Big Three automaker negotiations. Fain has been waiving his laundry list of “audacious” demands for 150,000 members, and now, he has another tool-belt notch: movement on the EV dilemma.
Simultaneously to Big Three talks, the UAW has been holding separate GM/LG battery plant negotiations in Warren, Ohio, for 1,100 workers. The joint venture agreed to give workers 25% raises on their current $16+ per hour, retroactive to late 2022. Members ratified this interim deal.
What does this portend for Big Three negotiations, if anything?
EVs have been seen as a “wild card” in these Big Three talks, and those Warren raises might be a bargaining chip. If, say, Ford or Stellantis shuts down Fain’s demand for a magical 32-hour work week, then perhaps the companies decide to use the Warren plant as a blueprint for an addendum about EV wages in the future. Considering that another 22 U.S. EV plants are in the works, Fain might think that’s a fair trade-off.
The UAW is undoubtedly looking to close the wage gap between EV and traditional assembly plants. Yet that move could backfire on workers due to the somewhat alien landscape of the EV market.
Higher labor costs move EVs away from the $25,000 “sweet spot” Stellantis insists is vital for EV sales. Unfortunately, zero new EV models currently meet that price point. Wage increases will not ease that goal and could cause job losses and a drop in union membership.
No wonder the UAW is lining its pockets in academia lately.
Onto the Big Three: Fain complained that talks are moving like molasses ahead of the Sept. 14 expiration. He says members are “burned out,” and he has dramatically responded to automaker offers. These fiery displays included Fain tossing a Stellantis offer in the trash on Facebook Live.
Stellantis called the UAW’s perspective unrealistic. At the same time, GM seems fine with raising wages but finds other demands unsustainable.
Another strategic move: Workers overwhelmingly authorized Big Three strikes by 97%. Yep, this negotiation tactic doesn’t guarantee a strike but puts pressure on companies over demands, including 46% pay hikes and restoration of COLA benefits.
The cost of a strike: The UAW has been preparing for this event with a $825 million strike fund. In 2023, their strike pay climbed from $275 to $500 weekly. The cost to the union would be $75 million weekly.
That sounds like a lot, but it’s a drop in the shop-rag bucket compared to the last Big Three skirmish, which cost GM $3.6 billion for a 40-day strike in 2019. Fain recently made a show of joining UAW members for a practice picket session in front of a Detroit Stellantis plant — so everyone knows he means business.
