| 24 July 2024, Wednesday |

UAW strike: Workers walk out at US motor industry giants

Employees at three of America’s largest automobile manufacturers have gone on strike in an unprecedented coordinated move.

More than 10,000 workers are taking part in the strike, which is aimed at three General Motors (GM), Ford, and Stellantis facilities.

The companies and the United Auto Workers union (UAW) are at odds over the parameters of new labor contracts.

The labor stoppage threatens to raise car costs and cause severe hardship for automakers.

The current contract ended on Thursday, and the UAW president, Shawn Fain, told the BBC that it was now up to the corporations to settle the disagreement.

“When they start taking care of their workers, it will come to an end,” he said.

The strike started at midnight eastern time (04:00 GMT) at GM’s Wentzville, Missouri, mid-size truck plant, Ford’s Bronco plant in Michigan and the Jeep plant in Toledo, Ohio, owned by Stellantis.

The plants are critical to the production of some of the “Detroit Three’s” most profitable vehicles.

Other facilities will continue to operate, the UAW said but it did not rule out broadening the strikes beyond the initial three targets.

A strike against all three companies at the same time is unprecedented in the union’s history.

With the deadline looming on Thursday, the White House said that President Joe Biden had spoken on the phone with Mr Fain about the negotiations but provided no further details. Mr Biden will address the action in remarks on Friday.

The union had sought a 40% pay increase for its roughly 140,000 members over four years, noting a comparable rise in pay for company leaders.

As of Wednesday, the three companies had improved their proposals, offering as much as a 20% pay rise.

Workers said the companies could afford to be more generous after years of record profits.

“In my opinion we are owed this,” said Paul Raczka, who works in a Stellantis factory in Michigan making Jeep Grand Cherokees.

The fourth generation in his family to work in the industry, Mr Raczka said such jobs, which came with good healthcare and secure pensions, had provided an “awesome living” for his parents – a way of life that no longer feels possible today.

The 31-year-old said he could not even afford to buy the car he makes.

“We are still sitting on the backburner while these CEOs are making, you know, upwards of $20m a year,” he said.

General Motors boss Mary Barra, whose total pay package was more than $28m last year, defended the firm’s offer to workers as “historic”.

She said UAW’s demands would amount to more than $100bn at a time when the company needed to invest in new technology.

“We have to make sure the company’s going to succeed for the next 115 years,” she said in an interview with the BBC’s US news partner, CBS, adding that the firm was continuing to negotiate to try to resolve the differences.

A 10-day strike by all 140,000 workers could cost the three firms nearly $1bn (£800m) and workers almost $900m in lost wages, according to estimates by the Anderson Economic Group. It said the total hit to the economy could amount to more than $5bn.

Tyler Theile, vice-president at the firm, said a stoppage would have to be “pretty lengthy to move the needle on national economic indicators”, but warned that the local impact will be significant.

Coming into the strike, the supply of cars, which has been strained since the parts shortages of the pandemic, remains far lower than it has been in the past.

Analysts said that could also mean a prolonged walkout leads to higher prices for buyers.

Ford, GM and Stellantis together account for about 40% of US car sales, though their share has dropped sharply over the last quarter of a century, as foreign firms such as Toyota make inroads.

The last time the car industry faced a strike was in 2019, when workers at GM walked off the job for six weeks.

GM worker Jessie Kelly, who participated in that walkout, said she had been trying to save up in anticipation of another stoppage.

UAW participants are due to receive $500 in weekly strike benefits from the union, but that would still be significantly less than her wages, she said.

“My strike bills will not cover my mortgage, let alone the grocery bills, let alone the lights and the everything else. So, it is gonna definitely be a struggle,” she said.

Ms Kelly, who lives near Detroit, said she supported the fight, despite the costs, noting that her pay has not kept pace with rising prices and is quickly eaten up by childcare and housing expenses. The 33-year-old said she had just two weeks of holiday a year, which she was typically forced to use for emergencies.

“At the end of the day, we all want to work for a corporation that is making good money. We just want our fair share of that,” she said.

“The CEOs are gonna keep paying themselves more and more money and we’re the only ones being left behind.”

  • Reuters