United Auto Workers (UAW) President Shawn Fain announced on Wednesday, with just over 24 hours remaining before the strike deadline, that the companies’ offers are insufficient, signaling the union’s readiness to strike.
Addressing union members through an online platform, Fain disclosed that General Motors, Ford, and Stellantis have slightly improved their initial wage proposals but have rejected several of the union’s other stipulations.
“We do not yet have offers on the table that reflect the sacrifices and contributions our members have made to these companies,” Fain emphasized. “To win, we’re likely going to have to take action. We are preparing to strike these companies in a way they’ve never seen before.”
The union’s ultimatum stipulates that contracts must be reached by 11:59 p.m. on Thursday to avert strikes. These strikes, if enacted, would target specific factories within each company. Notably, this would mark the first occasion in the union’s 80-plus-year history that all three automotive giants would be simultaneously affected.
Negotiations continued throughout Wednesday; however, both parties remain considerably apart in their positions.
Automakers argue the necessity of substantial investments for the development of electric vehicles alongside the continued production of internal combustion vehicles. They contend that an expensive labor agreement might place them at a competitive disadvantage against non-union foreign rivals. They maintain that their offers have been equitable.
Ford CEO Jim Farley, visibly frustrated during a Detroit auto show appearance, expressed exasperation at the lack of a substantive counteroffer from the union. He asserted that Ford had presented four offers, including a generous wage increase, the elimination of wage tiers, reinstatement of cost of living pay raises, and extended vacation time. The union disputes the claim that wage tiers have been abolished.
While United Auto Workers President Fain raised the prospect of an extensive strike involving all 146,000 UAW members, the union’s initial strategy is to initiate selective strikes at specific plants.
“If the companies continue to bargain in bad faith or continue to stall or continue to give us insulting offers, then our strike is going to continue to grow,” Fain warned, emphasizing the strategic nature of the targeted strikes with the potential for escalation.
Contract extensions will not be granted, resulting in employees who choose to remain on the job operating under expired agreements. United Auto Workers President Fain emphasized the adaptability and efficiency of the selective strike strategy.
In initial negotiations, the UAW sought a 40% raise over a four-year contract, later revising this to approximately 36%. The companies’ initial offers fell notably short of these figures.
In addition to general wage increases, the union is advocating for the restoration of cost-of-living raises, the cessation of wage tiers, a 32-hour workweek with 40 hours of pay, and the return of traditional defined-benefit pensions for new hires.
As of Wednesday, the companies increased their wage offers, but Fain deemed them inadequate. Ford’s offer stands at 20% over 4.5 years, with GM at 18% over four years, and Stellantis at 17.5%. These raises barely compensate for what Fain characterizes as minimal past increases.
Regarding cost-of-living adjustments, Fain noted that all three companies’ offers were insufficient in providing protection against inflation or in offering annual lump sums for many workers.
The companies rejected pay raises for retirees who have not received an increase in over a decade, Fain stated, also seeking concessions in annual profit-sharing checks.
In response, Stellantis conveyed its third wage-and-benefit offer and awaits the union’s response. GM reported progress in areas such as guaranteed annual wage increases, substantial investments in U.S. factories, and a shortened time frame for employees to reach top wages.
Ford CEO Farley asserted that the company has extended four increasingly generous offers since August 29, yet received no genuine counteroffer.
Thomas Kochan, a professor of work and employment at the Massachusetts Institute of Technology, predicted that both parties will need to make significant compromises swiftly to reach a resolution before Thursday’s deadline.
The public nature of negotiations, spearheaded by President Fain, has placed unprecedented pressure on both sides to reach an agreement, making this one of the most publicly scrutinized labor disputes in U.S. history.
