Auto workers are expanding their strike to 38 locations in 20 states, targeting Stellantis and GM
Sep 22, 2023, 4:50 AM
Striking United Auto Workers members cheer and wave their signs as a passing driver honks their horn outside the General Motors Memphis ACDelco Parts Distribution Center and Bulk Center after local workers joined national UAW strikes at 11 a.m. in Memphis, Tenn., on Friday, Sept. 22, 2023. (Chris Day/The Commercial Appeal via AP)
Credit: ASSOCIATED PRESS
(Chris Day/The Commercial Appeal via AP)
The United Auto Workers union expanded its strike against major carmakers Friday, walking out of 38 General Motors and Stellantis parts-distribution centers in 20 states.
Ford was spared additional strikes because the company has met some of the union’s demands during negotiations over the past week, UAW President Shawn Fain said during an online presentation to union members.
“We’ve made some real progress at Ford,” Fain said. “We still have serious issues to work through, but we do want to recognize that Ford is showing that they are serious about reaching a deal. At GM and Stellantis, it’s a different story.”
GM and Stellantis, he said, have rejected the union’s proposals for cost-of-living increases, profit sharing and job security, and “are going to need some serious pushing.”
Instead of targeting more production plants Friday, the UAW went after centers that distribute parts to car dealer service departments. That could quickly drag consumers into the middle of the fight, if dealers run short of parts.
The UAW said the new walkouts will affect 5,600 workers on top of the nearly 13,000 who began strikes last week at three Ford, GM and Stellantis assembly plants. Those original strikes will continue, the union said.
The UAW is continuing to avoid targeting plants that make Detroit’s bestsellers, such as the Ford F-150 and Stellantis’ Ram pickups, which represent outsize shares of the companies’ revenue and profit. That represents a union strategy to gradually increase the pain of a strike on the automakers. However, the industry’s supply chain is so integrated that even hitting lower-profile plants cuts into production.
Deutsche Bank analysts estimated Friday that GM, Ford and Stellantis have lost production of more than 16,000 vehicles since the strike started last week at a Ford assembly plant near Detroit, a GM factory in Wentzville, Missouri, and a Jeep plant run by Stellantis in Toledo, Ohio. Anderson Economic Group, a consulting firm in Michigan that tracks the industry, estimated Friday that the three big automakers have suffered economic losses of more than $1.6 billion.
The carmakers and some of their suppliers have laid off about 6,000 workers in moves they say are related to the strike. GM shut down a factory in Kansas that relies on parts stamped at the Wentzville plant.
Still, the impact is not yet being felt on car lots around the country — it will probably take a few weeks before the strike causes a significant shortage of new vehicles, according to analysts. Prices could rise sooner, however, if the prospect of a prolonged strike triggers panic buying.
In bargaining, the union is pointing to the carmakers’ huge recent profits as it seeks wage increases of about 36% over four years. The companies have offered a little over half that amount. The UAW has other demands, including a 32-hour work week for 40 hours of pay and a restoration of traditional pension plans for newer workers.
The companies say they can’t afford to meet the union’s demands because they need to invest profits in a costly transition from gas-powered cars to electric vehicles.
Fain said that Ford has agreed to some union proposals, including the restoration of cost-of-living wage increases that were dropped several years ago, better profit-sharing and improved job security.
A Ford spokesman, Daniel Barbossa, said the company “is working diligently with the UAW to reach a deal that rewards our workforce and enables Ford to invest in a vibrant and growing future.”
“Although we are making progress in some areas, we still have significant gaps to close on the key economic issues,” he said.
In response to repeated inquires, GM and Stellantis said Friday they would comment soon.
Rather than bargain with one company and set a pattern for contracts at the other two, the UAW has been negotiating simultaneously with all three Detroit giants. Targeting the parts-distributions centers could inflict quick pain on GM and Stellantis, said Daniel Ives, an analyst with Wedbush Securities.
“The UAW is going for the gut punch as this strike gets a lot nastier,” Ives said. He called it “a very strategic and risky poker move by the UAW.”
Even with Friday’s expansion, the strikes involve only a little over 10% of the UAW’s 146,000 members. That will make the union’s $825 million strike fund last longer, as most members will keep working under the expired contract and pay into the fund. However, the longer the strike lasts, the greater the risk of dissension between workers who will keep collecting full paychecks and those getting $500 a week from the union.
Fain believes that most of the public is on the union’s side. He invited anyone who supports the union — “all the way up to the president of the United States” — to join strikers on the picket lines.
