Strike worries overshadow Detroit Auto Show
By AFP
September 10, 2023
Led by its new president, Shawn Fain, the United Auto Workers has thus far rejected proposals from Detroit automakers as inadequate
UAW is willing to strike at all three automakers, magnifying the economic falloutBy AFP
September 10, 2023
Led by its new president, Shawn Fain, the United Auto Workers has thus far rejected proposals from Detroit automakers as inadequate
- Copyright GETTY IMAGES NORTH AMERICA/AFP/File BILL PUGLIANO
John BIERS
This week’s Detroit Auto Show is meant to showcase impressive new electric vehicles, but the fanfare looks destined to be upstaged by a brewing labor dispute and the increasing likelihood of a strike.
The show, known officially as the North American International Detroit Auto Show, opens to the public on Saturday following media and technology days earlier in the week.
But this year’s Detroit gathering — now mainly a forum for products of the three legacy Michigan automakers — comes as Detroit’s “Big Three” face down-to-the-wire contract negotiations with the United Auto Workers led by its ambitious new president Shawn Fain.
“The labor contract negotiations are on everyone’s mind,” said Alan Amici, president of the Center for Automotive Research, a nonprofit in Ann Arbor, Michigan. “There’s a degree of nervousness in the Detroit area.”
As the two sides have traded proposals and counterproposals in recent days, Fain has made clear his displeasure with Ford, General Motors and Stellantis, reiterating the possibility of a strike at all three companies if there is no agreement by September 14, when the current contracts expire.
The UAW represents about 150,000 workers at the three companies.
“If we hit 11:59 Thursday without a deal at any of the Big Three automakers, there will be a strike at all three if need be,” Fain said Friday night in a webcast briefing.
Fain has said rank-and-file workers merit the same 40 percent pay hikes as enjoyed by the automakers’ CEOs. But the latest pay offers from the companies fall well below this level.
The carmakers have also balked at measures to boost retiree health benefits and reinstate guaranteed pensions for all workers.
– Smaller show –
Formerly held in January, the Detroit show was rebooted as an autumn event in 2022 with a primary focus on retail consumers, offering a chance to get a closer look at electric vehicles (EVs) expected to become a bigger presence in the years ahead.
Last year’s event had few major auto reveals and was skipped by international mainstays of the old January show like Toyota and Volkswagen. But President Joe Biden made an appearance, touting an EV future.
This year’s highlights include the Tuesday night launch of an upgraded Ford F-150 pickup, long the top-selling vehicle in the United States.
That will be followed on Wednesday by press conferences with the GM and Stellantis brands (Stellantis was formed by the 2021 merger of Fiat Chrysler and the French PSA group), and by a technology forum on Thursday and a fireside chat with bestselling author Malcolm Gladwell.
The UAW has not said whether it will hold events near Huntington Place, where the show is being held in downtown Detroit. But the union is expected to remain highly visible as the deadline nears.
– Tough talk –
Ford was the first to respond to the UAW’s demands, offering a nine percent general wage increase plus six percent in one-time bonuses.
Fain said the Ford proposal “insults our very worth,” and he rejected a similar offer subsequently released by GM as “insulting.”
On Friday, Stellantis released an offer that included a 14.5 percent increase in wages, plus a $6,000 one-time inflation adjustment in the first year of the contract, followed by $4,500 in such payments the following three years.
“This is movement,” Fain said Friday night. “We went from nine percent at Ford to 14 and a half percent at Stellantis. That’s happening because we’re putting on pressure.”
But a 14.5 percent increase is “deeply inadequate,” he said. “It doesn’t make up for inflation. It doesn’t make up for decades of falling wages. And it doesn’t reflect the massive profits we’ve generated for this company.”
Given the gulf between the UAW and the companies and the little time remaining, many analysts are viewing a strike as likely, though probably not against all three automakers.
Harry Katz, a professor at Cornell’s School of Industrial and Labor Relations, said Fain’s “sharp” rhetoric, coupled with the waning hours have made a strike more likely.
But Katz noted that Teamsters President Sean O’Brien had also blasted company officials before reaching a deal with package delivery company UPS that averted a strike.
“There are settlements out there that are better if the parties can find them,” Katz said. “But sometimes they don’t find them.”
Jason Miller, a professor of supply chain management at Michigan State University, said a lengthy strike would reverberate beyond Michigan, resulting in depressed household spending and having ripple effects at auto suppliers that might lay off workers.
The six-week 2019 strike at GM “hurt us a little but we obviously recovered from it,” said Miller.
A long strike at all three companies would “have a major negative on the economy of the Great Lakes region and Canada as well.”
This week’s Detroit Auto Show is meant to showcase impressive new electric vehicles, but the fanfare looks destined to be upstaged by a brewing labor dispute and the increasing likelihood of a strike.
The show, known officially as the North American International Detroit Auto Show, opens to the public on Saturday following media and technology days earlier in the week.
But this year’s Detroit gathering — now mainly a forum for products of the three legacy Michigan automakers — comes as Detroit’s “Big Three” face down-to-the-wire contract negotiations with the United Auto Workers led by its ambitious new president Shawn Fain.
“The labor contract negotiations are on everyone’s mind,” said Alan Amici, president of the Center for Automotive Research, a nonprofit in Ann Arbor, Michigan. “There’s a degree of nervousness in the Detroit area.”
As the two sides have traded proposals and counterproposals in recent days, Fain has made clear his displeasure with Ford, General Motors and Stellantis, reiterating the possibility of a strike at all three companies if there is no agreement by September 14, when the current contracts expire.
The UAW represents about 150,000 workers at the three companies.
“If we hit 11:59 Thursday without a deal at any of the Big Three automakers, there will be a strike at all three if need be,” Fain said Friday night in a webcast briefing.
Fain has said rank-and-file workers merit the same 40 percent pay hikes as enjoyed by the automakers’ CEOs. But the latest pay offers from the companies fall well below this level.
The carmakers have also balked at measures to boost retiree health benefits and reinstate guaranteed pensions for all workers.
– Smaller show –
Formerly held in January, the Detroit show was rebooted as an autumn event in 2022 with a primary focus on retail consumers, offering a chance to get a closer look at electric vehicles (EVs) expected to become a bigger presence in the years ahead.
Last year’s event had few major auto reveals and was skipped by international mainstays of the old January show like Toyota and Volkswagen. But President Joe Biden made an appearance, touting an EV future.
This year’s highlights include the Tuesday night launch of an upgraded Ford F-150 pickup, long the top-selling vehicle in the United States.
That will be followed on Wednesday by press conferences with the GM and Stellantis brands (Stellantis was formed by the 2021 merger of Fiat Chrysler and the French PSA group), and by a technology forum on Thursday and a fireside chat with bestselling author Malcolm Gladwell.
The UAW has not said whether it will hold events near Huntington Place, where the show is being held in downtown Detroit. But the union is expected to remain highly visible as the deadline nears.
– Tough talk –
Ford was the first to respond to the UAW’s demands, offering a nine percent general wage increase plus six percent in one-time bonuses.
Fain said the Ford proposal “insults our very worth,” and he rejected a similar offer subsequently released by GM as “insulting.”
On Friday, Stellantis released an offer that included a 14.5 percent increase in wages, plus a $6,000 one-time inflation adjustment in the first year of the contract, followed by $4,500 in such payments the following three years.
“This is movement,” Fain said Friday night. “We went from nine percent at Ford to 14 and a half percent at Stellantis. That’s happening because we’re putting on pressure.”
But a 14.5 percent increase is “deeply inadequate,” he said. “It doesn’t make up for inflation. It doesn’t make up for decades of falling wages. And it doesn’t reflect the massive profits we’ve generated for this company.”
Given the gulf between the UAW and the companies and the little time remaining, many analysts are viewing a strike as likely, though probably not against all three automakers.
Harry Katz, a professor at Cornell’s School of Industrial and Labor Relations, said Fain’s “sharp” rhetoric, coupled with the waning hours have made a strike more likely.
But Katz noted that Teamsters President Sean O’Brien had also blasted company officials before reaching a deal with package delivery company UPS that averted a strike.
“There are settlements out there that are better if the parties can find them,” Katz said. “But sometimes they don’t find them.”
Jason Miller, a professor of supply chain management at Michigan State University, said a lengthy strike would reverberate beyond Michigan, resulting in depressed household spending and having ripple effects at auto suppliers that might lay off workers.
The six-week 2019 strike at GM “hurt us a little but we obviously recovered from it,” said Miller.
A long strike at all three companies would “have a major negative on the economy of the Great Lakes region and Canada as well.”
By Karen Graham
DIGITAL JOURNAL
September 10, 2023
Community members, families, and workers are picketing and standing together for economic justice on and off the job at the Big Three. Source - @UAW
UAW President Shawn Fain says the union could strike at all three automakers simultaneously, a step it has never taken before.
The three companies, Ford Motor, General Motors and Stellantis, and the UAW Union have continued to trade wage and benefit counteroffers and will likely continue to do so into the work week ahead of Thursday night’s strike deadline.
However, on Friday, according to the Associated Press, Fain said that the company’s offers weren’t enough and that he had put them in the trash.
So far, the companies have offered to raise pay by 14 percent to 16 percent over four years. Their offers include lump sum payments to help ease the impact of inflation, and policy changes that would lift the pay of recent hires and temporary workers.
But Fain has called the offers “insulting,” pointing out that the three manufacturers have been making near-record profits for almost a decade, and that pay packages of top executives have increased substantially.
According to the New York Times, the 14 to 15 percent pay increase offered by the companies is not even close to the 46 percent raises in general pay over four years the UAW wants — an increase that would elevate a top-scale assembly plant worker from $32 an hour now to about $47.
Fain has argued that the richly profitable automakers can afford to raise workers’ pay significantly to make up for what the union gave up to help the companies withstand the 2007-2009 financial crisis and the Great Recession.
Over the past decade, the Detroit Three have emerged as robust profit-makers. They’ve collectively posted net income of $164 billion, $20 billion of it this year. The CEOs of all three major automakers earn multiple millions in annual compensation.
September 10, 2023
Community members, families, and workers are picketing and standing together for economic justice on and off the job at the Big Three. Source - @UAW
UAW President Shawn Fain says the union could strike at all three automakers simultaneously, a step it has never taken before.
The three companies, Ford Motor, General Motors and Stellantis, and the UAW Union have continued to trade wage and benefit counteroffers and will likely continue to do so into the work week ahead of Thursday night’s strike deadline.
However, on Friday, according to the Associated Press, Fain said that the company’s offers weren’t enough and that he had put them in the trash.
So far, the companies have offered to raise pay by 14 percent to 16 percent over four years. Their offers include lump sum payments to help ease the impact of inflation, and policy changes that would lift the pay of recent hires and temporary workers.
But Fain has called the offers “insulting,” pointing out that the three manufacturers have been making near-record profits for almost a decade, and that pay packages of top executives have increased substantially.
According to the New York Times, the 14 to 15 percent pay increase offered by the companies is not even close to the 46 percent raises in general pay over four years the UAW wants — an increase that would elevate a top-scale assembly plant worker from $32 an hour now to about $47.
Fain has argued that the richly profitable automakers can afford to raise workers’ pay significantly to make up for what the union gave up to help the companies withstand the 2007-2009 financial crisis and the Great Recession.
Over the past decade, the Detroit Three have emerged as robust profit-makers. They’ve collectively posted net income of $164 billion, $20 billion of it this year. The CEOs of all three major automakers earn multiple millions in annual compensation.
General Motors Chairman and CEO Ed Whitacre addresses the gathering after the first Chevrolet Volt battery came off the assembly line at the GM Brownstown Battery plant in Brownstown Township, Michigan Thursday, January 7, 2010. The facility is the first lithium ion battery pack manufacturing plant in the U.S. operated by a major automaker.
(Photo by Jeffrey Sauger for General Motors) Public Domain
Political and economic fallout from a strike
All this hoopla is taking place as the country makes a sweeping shift from combustion engine cars and trucks to electric vehicles, which require fewer parts and less labor to produce.
At the center of the wage dispute is President Joe Biden’s signature policies. Biden’s effort to counter climate change and create U.S. manufacturing jobs through hundreds of billions of dollars in clean-energy spending is frustrating the UAW, which is demanding that workers share in the benefits from the government-subsidized shift to electric vehicles.
U.A.W. leaders and members are increasingly worried that the transition will eliminate jobs and, over time, reduce wages and benefits.
“We aren’t going to stand by and allow them to drag out the negotiations like they’ve done in the past,” Mr. Fain said Friday in a video on Facebook. “If we hit 11:59 on Thursday without a deal at any of the Big Three automakers, there will be a strike — at all three if need be.”
But to make matters even worse – the autoworkers strike could also coincide with a federal government shutdown if Congress cannot reach a stopgap spending deal by Sept. 30, according to Politico.
The economic fallout could be tremendous. The auto industry accounts for about 3 percent of the U.S. economy’s gross domestic product — its total output of goods and services — and the Detroit automakers represent about half of the total U.S. car market.
While UAW strikers would receive $500 a week in strike pay, it is far less than they would make working. But for the Big Three, a 10-day strike against all three companies could cost them nearly one billion dollars,
The U.S. Chamber of Commerce, National Association of Manufacturers, and Motor Equipment and Manufacturers Association, as well as GM, Ford and Stellantis, have either briefed the White House on their point of view or are planning to in the days ahead.
Business officials have shared an analysis with the White House that suggested that 50 percent of suppliers would go bankrupt within two to three weeks of a strike — affecting approximately 345,000 workers.
Political and economic fallout from a strike
All this hoopla is taking place as the country makes a sweeping shift from combustion engine cars and trucks to electric vehicles, which require fewer parts and less labor to produce.
At the center of the wage dispute is President Joe Biden’s signature policies. Biden’s effort to counter climate change and create U.S. manufacturing jobs through hundreds of billions of dollars in clean-energy spending is frustrating the UAW, which is demanding that workers share in the benefits from the government-subsidized shift to electric vehicles.
U.A.W. leaders and members are increasingly worried that the transition will eliminate jobs and, over time, reduce wages and benefits.
“We aren’t going to stand by and allow them to drag out the negotiations like they’ve done in the past,” Mr. Fain said Friday in a video on Facebook. “If we hit 11:59 on Thursday without a deal at any of the Big Three automakers, there will be a strike — at all three if need be.”
But to make matters even worse – the autoworkers strike could also coincide with a federal government shutdown if Congress cannot reach a stopgap spending deal by Sept. 30, according to Politico.
The economic fallout could be tremendous. The auto industry accounts for about 3 percent of the U.S. economy’s gross domestic product — its total output of goods and services — and the Detroit automakers represent about half of the total U.S. car market.
While UAW strikers would receive $500 a week in strike pay, it is far less than they would make working. But for the Big Three, a 10-day strike against all three companies could cost them nearly one billion dollars,
The U.S. Chamber of Commerce, National Association of Manufacturers, and Motor Equipment and Manufacturers Association, as well as GM, Ford and Stellantis, have either briefed the White House on their point of view or are planning to in the days ahead.
Business officials have shared an analysis with the White House that suggested that 50 percent of suppliers would go bankrupt within two to three weeks of a strike — affecting approximately 345,000 workers.
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