The United Auto Workers (UAW) union initiated a widespread strike across all Big Three automakers on Friday, employing a novel “stand up” strategy, after the passing of Thursday night’s deadline. This marks the first time since the six-week strike against GM in 2019 that the UAW has taken such action against the Big Three.
In a late-night address on Thursday via Facebook Live, UAW President Shawn Fain announced, “Tonight at midnight, GM Wentzville Assembly, Local 2250 in Region 4; Stellantis Toledo Assembly Complex, Local 12 in Region 2B; and Ford Michigan Assembly Plant – Final Assembly and Paint only, Local 900 in Region 1A will STAND UP and walk out on strike. The rest of us will keep organizing and support them on the picket line.”
This “stand up” strategy involves a selective strike, where approximately 13,000 out of 147,000 UAW members will strike at specific plants owned by GM, Stellantis, and Ford. The targeted plants include GM’s Wentzville Assembly in Missouri, Stellantis’ Toledo Assembly Complex, and Ford’s Michigan Assembly Plant in Wayne.
The UAW intends to gradually mobilize more locals to join the strike as negotiations progress, aiming to exert “maximum leverage and maximum flexibility” in their discussions with the automakers. Simultaneously, UAW chapters not currently called to strike will continue regular operations, allowing the union to sustain its $825 million “strike fund” for an extended period.
While striking workers will receive $500 weekly to cover expenses, non-striking UAW members will continue to earn their wages and contribute to the strike fund, albeit working under expired contracts, a concession granted by the union.
Labor expert Marick Masters, a professor at Wayne State University’s school of business, cautioned that this unconventional strategy carries risks, emphasizing that the Big Three are unlikely to passively endure the union’s strategic strikes.
Ford reported receiving a substantive counterproposal from the UAW late Thursday night but noted minimal progress from the union’s initial demands. GM CEO Mary Barra confirmed the company’s improved offer, including a 20% pay increase, but the proposal was not accepted. Stellantis expressed disappointment at the UAW leadership’s refusal to engage in negotiations responsibly.
Initially, the UAW sought “substantial wage increases” equating to a 46% rise over three years (now reportedly down to 36%). Other demands included the elimination of compensation tiers, restoration of cost-of-living adjustments, a new pension plan, and a reduction in workweeks to 32 hours.
Consulting firm Anderson Economic Group estimates that a strike at all Big Three automakers could lead to a $5.6 billion blow to US GDP after just 10 days, with UAW lost wages nearing $860 million. Goldman Sachs projected a negative impact on quarterly annualized US GDP growth, potentially ranging from 0.05 to 0.10 percentage points for each week the strike persists.
The duration of the strike remains uncertain, with experts speculating it could extend beyond industry expectations. Some anticipate that the companies might consider locking out employees to expedite the resolution process.
This strike will have repercussions not only for the UAW and the Big Three but also for consumers. It is likely to exacerbate pressures on new and used car prices, a situation attributed to robust consumer demand and ongoing supply chain disruptions.
The UAW is poised to leverage its current public support, as evidenced by a rally planned for Friday afternoon in downtown Detroit, featuring prominent politicians including Senator Bernie Sanders, who are expected to address the gathering on behalf of the union.
Source: Yahoo Finance
