Shawn Fain, president of the United Auto Workers, said the union and major Detroit automakers are still far apart on a new labor contract, threatening to cut some plants at each company and possibly add others.
While a work stoppage may still be entirely avoidable, the UAW and General Motors Co., Ford Motor Co. are closing in. and Stellantis NV a strike deadline. The union’s current labor contract expires late Thursday evening.
If the union and automakers cannot reach an agreement, the UAW will initially strike at a limited number of targeted locations, Fain said Wednesday. It will yield more depending on how negotiations go, and could potentially halt operations completely at all three companies – an event unlike any other of its kind. He characterized this move as one that would keep automakers “guessing,” giving the UAW more influence.
“We are still very far apart on our top priorities,” Fain said in a Facebook Live broadcast aimed at the union’s 150,000 members. “We are prepared to attack these companies in a way they have never seen before.”
Fain said the final decision on which plants will be targeted will be made shortly before the strike is announced. As a result, automakers have limited resources to plan for production losses. The UAW is not renewing its current contract, so workers at factories that aren’t striking will work under expired agreements.
“The future of our industry is at stake,” Ford CEO Jim Farley said in an emailed statement after Fain spoke. “Let’s do everything we can to avoid a disastrous outcome.”
“We are here and ready to reach a deal,” Farley said. “We need to work creatively to solve difficult problems instead of planning strikes and PR events.”
GM said it has made “strong offers” to the UAW, including guaranteed pay increases and shorter advancement to the top pay grade, and that it continues to negotiate in good faith, according to a spokesman for the automaker.
Stellantis did not immediately respond to a request for comment.
Economic problems
The UAW and three automakers are still working through key economic issues, including wage increases, cost-of-living adjustments — called COLA — as well as pensions for newer workers and job security at select plants. Both the union and the companies have amended their offers in their attempt to reach an agreement, but are still not completely in agreement.
The union lowered its wage demand from 40%, which amounts to 46% once wage increases compound, to 36%. Ford had offered to reinstate COLA for the first time in 14 years, but Fain said the formula offered was not good enough. Yet the volleys show that both sides are abandoning their opening offers.
Fain said the union is proposing a 90-day progression to the highest wage rate and restoring pensions and health care to all workers. He said the three companies agreed to shorten the path to full pay to four years. All three rejected pension and health proposals for workers hired after 2007.
On wages, Fain said Ford proposed a 20% pay increase over four years, while GM offered 18% and Stellantis 17.5%.
He said all three companies proposed different COLA programs, but none were satisfactory. He added that all three companies are trying to reduce profit sharing. He said Ford’s would have been a 21% smaller check last year and GM’s would have reduced the payment by 29%.
The union president also complained that Stellantis wants the right to close and sell 18 different facilities in the US.
“I am comfortable that I will strike if I have to because I know we are on the right side of this fight,” Fain said. “It is a struggle of the working class against the rich.”