Protesters during a United Auto Workers (UAW) practice picket outside the Stellantis Mack Assembly Plant in Detroit, Michigan, U.S., on Wednesday, August 23, 2023.
Jeff Kowalsky | Bloomberg | Getty Images
Stellar said Saturday that its latest proposal to the United Auto Workers includes a nearly 21% pay increase over the life of the contract, including an immediate 10% pay increase, and the end of pay scales for some workers, the latest development in a historic confrontation between the three major Detroit automakers and the union.
The Jeep maker’s proposal, which is in line with proposals from Ford And General engineswould also continue to offer profit sharing to employees, according to new details about the offering the company released Saturday.
“The teams have been listening very, very carefully, very carefully to come up with the best offers that we can make that can also protect the business,” COO Mark Stewart said on a call with reporters on Saturday.
The standoff between the UAW and major automakers Stellantis, Ford and General Motors reached a fever pitch Friday, with the union beginning work stoppages after an agreement failed to reach a deal Thursday evening. The so-called stand-up strike began with strikes at three major factories – one for each automaker – with the possibility that the UAW could call on more of its members to join the strike if necessary.
The union is seeking, among other things, a 40% hourly wage increase, a shorter 32-hour workweek, a return to traditional pensions, the elimination of compensation levels and a restoration of cost-of-living adjustments. The UAW did not immediately respond to a request for comment on the proposal.
Meanwhile, Ford and GM resumed negotiations Saturday after no talks took place between the union and either automaker the day before. Stellantis told NBC News it planned to resume talks on Monday.
UAW President Shawn Fain said earlier this week that Stellantis had previously offered a 17.5% raise.
Under the new proposal, starting pay for additional employees would increase by $4.22, or nearly 27%, to $20 per hour.
The company also said it would shorten the timeline for moving up the hourly pay scale to six months to four years, meaning all full-time hourly employees would reach the top before the contract expires. Under the offer, the payroll system would be completely eliminated for the Mopar division, which is known for service, parts and customer interaction.
Stellantis also offered an inflation protection measure as compensation. The company said it has committed more than $1 billion to improvements in pension and retirement savings plans for current employees and retirees.
Stellantis leadership also pushed back against the union’s descriptions of the automaker’s plans to close or sell 18 factories. The company has said it aims to run parts distribution centers more efficiently and continue to shift resources to electric vehicles. Jobs at these factories would be preserved, the company said.
The automaker also emphasized its commitment to negotiate and reach an agreement that is financially viable, echoing concerns raised by Ford and GM leaders. Ford CEO Jim Farley said in a CNBC interview Friday that the UAW’s demands would force the company to “choose bankruptcy over supporting our employees.” Stellantis leadership noted that the company must remain competitive with automakers that do not have unionized workers.
“It’s not about warfare, it’s about win-win,” Stewart said. “It’s about finding something that’s great for our people today, that we can sustain a future for tomorrow… that our company can continue the investment path we have for electrification, and that our U.S. operations are strong so we can compete. against the transplants and we can compete with the newcomers.”
President Joe Biden said Friday that the companies must improve their current offers to ensure a strong contract is agreed upon during a period of record profits.
— CNBC’s Michael Wayland contributed to this report.