Unionized U.S. auto workers went on strike Friday to pressure Detroit’s three automakers to raise wages at a time of big profits as the industry begins a costly transition from energy-intensive vehicles towards electric vehicles.
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UAW strike: negotiations, demands, controversy
The United Auto Workers union is trying to inflict a new kind of pain on businesses and recoup some of the wages and benefits lost by workers due to the simultaneous strike at General Motors, Ford and Chrysler owner Stellantis, for the first time in its history. .
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Strikes only occur at three assembly plants:
- GM plant in Wentzville, Missouri
- Ford plant in Wayne, Michigan, near Detroit
- Jeep factory managed by Stellantis in Toledo, Ohio.
President Joe Biden supported workers, sending officials to Detroit to help break the impasse and saying the Big Three automakers should share their “record profits.”
According to union president Shawn Fain, workers could move to other plants if companies don’t come up with better proposals.
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Fain, the first union leader elected directly by the members, is the creator of the new negotiating strategy. Fain campaigned as an opponent of business rather than a business partner, saying, “We’ve been a one-party state longer than I have.” »
It’s time for a new approach to bargaining, according to David Green, a former local union leader elected this year to regional director. According to Green, “the risks of not doing something different outweigh the risks of doing the same thing and expecting a different result.”
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During the more than two decades that Green worked for General Motors, he witnessed the closing of a 3,000-person assembly plant in Lordstown, Ohio. Several concessions made by companies to help them survive the Great Recession were accepted by the union. Green said calling Fain’s strategy “refreshing” and continued: “We’ve only gone backwards over the last 20 years.” »
According to GM CEO Mary Barra, the limited strike approach could have repercussions, she said Friday on CNBC.
According to Ford spokeswoman Jennifer Enoch, the company informed 600 non-striking employees at its Wayne plant not to come to work Friday due to interruptions caused by the strike.
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About 3,300 workers at the Ford plant are on strike. About 5,800 people work at the Toledo Jeep complex, while 3,600 are employed at GM’s Wentzville facility.
Full-size pickup trucks and large SUVs, which are the industry’s main cash cows, have not been targeted by the union.
Automakers say they are facing unprecedented demand by creating new electric vehicles while producing gas-powered cars, SUVs and trucks to pay the bills. They worry that labor costs will rise to the point where they will have to charge more for their vehicles than those made by foreign automakers with factories in the United States.
Controversies
The UAW has always dealt with one automaker at a time during its 88-year history, minimizing the effects of potential work stoppages on the entire industry.
Currently, 13,000 of the three companies’ 146,000 employees are on strike, complicating operations for the automakers while limiting the drain on the union’s $825 million strike fund.
Employees stopped receiving cost-of-living increases and defined benefit pensions for recruits starting in 2007. The UAW established wage levels to help companies avoid financial distress before and after the Great Recession. However, only Ford escaped bankruptcy.
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Many say it’s time to get over the trade-offs as companies make huge profits and CEO pay rises.
Costs would increase for workers and businesses if contract negotiations drag on and strikes affect more factories. Car dealerships could experience a shortage of vehicles, which would drive up prices and encourage buyers to buy from foreign automakers that employ non-union workers.
Additionally, it may add new strains to an economy that has benefited from lower inflation.
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The strikes will determine the future of the union and the U.S. auto industry at a time when U.S. unions are asserting their power and companies are preparing to make a historic shift from producing internal combustion automobiles to electric vehicles.
The walkouts will also be a topic in the following year’s presidential election, testing Biden’s claim that he is the most pro-union president in American history.
Requirements and negotiations
Employees are demanding an overall salary increase of 36% over four years, while employers are proposing increases ranging from 17.5% to 20%.
Alongside wage increases, union negotiators are calling for, among other things, the reinstatement of cost-of-living wage increases, an end to wage differentials in factories, a 32-hour week with 40 hours of pay, the reinstatement traditional salaries. defined benefit pensions for new hires who currently only benefit from 401(k)-type retirement plans; and pension increases for retirees.
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Even Fain called the union’s demands outrageous, but he says that because automakers make billions, they can afford to respond to them. He scoffs at companies’ arguments that costly regulations would cause them to raise vehicle prices, saying labor represents only 4 to 5 percent of the cost of a vehicle.
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