February 25, 2024

The first salvos of a possible protracted strike could hurt the U.S. economic system and have an impact on presidential elections in 2024.

The United Auto Workers, a union of nearly 13,000 workers in Ohio Mic, Michigan, and Missouri, began a strike early on Friday. If its demands for pay increases of up to 40% and other gains are not met, the strike could spread to more plants.

The union’s contracts with General Motors (G.M.), Ford Motors (F), and Stellantis — which owns Chrysler Jeep Ram — ended on Thursday. However, the union and companies are still far away from reaching a new agreement.

Shawn Fain – the U.A.W. president – used sweeping words on Thursday to explain why his union members went on strike at the same time against three automakers, something that the union has never done before in its 90-year history.

In an online video, Mr. Fain, who was the first union leader directly elected by its members, stated that “this is a defining moment for our generation.” The money is there, the cause is just, the world is watching, and U.A.W. “The money is there, the reason is righteous, and the world is watching. The U.A.W.

U.A.W. The U.A.W. said that it would resume negotiations on Saturday. On Friday, President Biden sent two high-ranking administration officials to Detroit to encourage companies and unions to reach an agreement.

Strikers at a Ford Plant in Wayne, Mich., west of Detroit waved placards – one said, “Record Profits, Record Contracts.” — and gave thumbs up to vehicles that honked. On a metal sign attached to a chain link fence, it read: “Absolutely no foreign cars allowed.” Protesters were assigned a six-hour picket-line shift. If the strike continues, they will only be required to work one shift per week.

The conflict is primarily a fight between autoworkers and automakers. However, it could have wider-reaching effects. A long strike could reduce the number of new cars on the market, which would fuel inflation and force the Federal Reserve to maintain high-interest rates.

The president spoke out in support of the union at the White House last Friday. The U.A.W. has made extraordinary sacrifices and contributed to record profits for automakers over the past decade. “It is not fair that these record profits are not shared fairly.” But those record profits were not shared fairly.”

The union drive and the organizing of labor

  • Microsoft: Celebrating a year that saw major gains for organized labor, the tech giant has announced that it will remain neutral if any U.S.-based workers seek to unionize.
  • Starbucks: Federal labor regulators accused Starbucks of closing illegally 23 stores in order to suppress organizing activities and tried to force the company to reopen the stores.
  • Tesla: Weeks after mechanics who worked for Tesla in Sweden in late October walked out of their jobs, other unions in the country, as well as in Scandinavia, have joined in the strike.
  • Amazon More than a year after Staten Island workers voted to create the company’s very first union in the United States. Amazon seems to be taking an even harder line toward labor organizing.

The U.A.W. The U.A.W. The union says its demands roughly correspond to the increases in compensation of top executives at Ford, G.M. The increases are intended to compensate workers who have lost ground due to inflation and for large concessions made by the union to automakers following the financial crisis of 2007-2008. The league made big concessions to the automakers after the 2007-2008 financial crisis when G.M.

Auto executives claim that they pay their production workers significantly more than their rivals like Tesla and Toyota, whose U.S. employees are not unionized. These companies claim that such large raises will undermine their efforts in developing electric vehicles, and they would also lose relevance as the industry shifts from gasoline vehicles to electric cars.

If the unions get everything they want, “we will have to cancel all our E.V. Jim Farley said that in a Friday interview, Ford’s chief executive, Jim Farley, would have to cancel his E.V. Ford should instead focus on large pickups and sports utility vehicles that produce the most profits, said Farley.

Ford, the company with the largest number of unionized employees, posted a profit in the second quarter of $1.9 billion, or 4 percent of sales. Tesla earned $2.7 billion during the same period, which is about 11 percent.

Mr. Farley was pessimistic regarding the likelihood of a contract being reached soon. He said that the company was not acting in good faith by proposing deals that would sabotage our investments.

The union’s decision by Mr. Fain to close only three factories marks a change from previous strikes when they would walk out of the factories of one automaker. The union wants to hurt the automakers by stopping the production of profitable vehicles while still allowing the majority of plants to operate.

It may be hard for the unions to limit the harm to their members’ incomes. Ford asked workers in Michigan who weren’t on strike to stay at home Friday due to parts shortages. G.M. G.M.

Less than 10% of the U.A.W. Fewer than 10 percent of the nearly 150,000 U.A.W. The union could maintain pressure for longer by having limited strikes. Its strike fund of 825 million dollars would allow it to do so. The partnership will cover the health insurance premiums of striking workers and pay them $500 per week.

President Biden said at the White House on Friday that automakers are earning record profits because of “the extraordinary skill and sacrifices made by U.A.W. Biden told the White House audience on Friday that automakers have been earning record profits “because of the remarkable talent and gifts made by U.A.W.

The workers in Wentzville, Mo., where the GMC Canyon and Chevrolet Colorado are made, have shut down the Stellantis complex that makes the Jeep Gladiator and Jeep Wrangler. Workers also shut down the Stellantis plant in Toledo, Ohio, that produces the Jeep Gladiator, Jeep Wrangler, and GMC Canyon. The union will target more factories if no agreement can be reached.

The union also wants cost-of-living adjustments to protect workers in the event of a new inflation spike. It also intends to restore pensions, which the union agreed to eliminate for newer employees after the financial crises. Also, it wants improved retiree benefits as well as shorter work hours. The union wants to get rid of a system where new employees are paid much less than U.A.W.’s top wages. The association also wants to eliminate a wage system that starts new hires at a much lower salary than the top U.A.W.

The companies offered to increase pay by 14.5 to 20 percent in four years as of last Friday. They include lump-sum payments to offset inflation and policy changes, which would raise the revenue of temporary workers and recent hires, who earn about a third of what veteran union members do.

G.M. In an attempt to maintain assembly lines, G.M. Late Thursday, G.M. offered its employees an increase of 20 percent and stated that it would pay cost-of-living adjustments to veteran workers. The 20 percent raise would be more than what employees have received for decades. The union, however, rejected the offer because it said that the increase would barely cover inflation.

Leaders of automakers have criticized U.A.W. tactics. They focused on Mr. Fain, who was elected president in March. He declared that he would end what he called overly friendly relationships between union leaders and auto executives. After two former U.A.W. leaders were sentenced to prison for federal corruption, Fain took office. Presidentsley, Ford’s president, said that the two sides need to negotiate instead of “planning strike and P.R. Mary T. Barra is the G.M. Chief Executive M.ary T. Barra said, “Every negotiation takes on the personality of the leader.”

The success of the autoworkers could inspire other workers. The union movement is growing: Hollywood screenwriters, actors, and other workers have been striking for months. In August, United Parcel Service’s employees received their largest raises in history in a contract that the International Brotherhood of Teamsters negotiated.

Mijincha, an assistant professor from the University of California Santa Cruz who studies the relationship between labor’s interest and the fight against global warming, said that workers have been squeezed too long. “People are seeing that there is a path to greater economic security, and workers have the power together.”

Several hundred U.A.W. members attended a rally held in downtown Detroit on Friday evening. Mr. Fain introduced Vermont independent Senator Bernie Sanders to the audience. Sanders told the crowd that the fight they were waging was not only about wages, working conditions, and pensions for the auto industry. It’s about taking on corporate greed.

The strikes are occurring as auto production continues to recover from the effects caused by the pandemic that led to shortages in semiconductors and other parts. Prices and waiting times for cars have decreased, but inventories are still low. A long strike could make it difficult to find U.S.-made models.

Wes Lutz is the owner of Extreme Dodge in Jackson, Mich. He said, “We are not back up to speed inventory wise.”

Scarcity can be good for automakers. During the pandemic, they were able to increase their profit margins. It would also benefit carmakers who were having difficulty moving certain models. Pat Ryan, C.E.O. of Co-Pilot’s car-shopping application, said Stellantis has at least 10100 days of inventory on brands such as Dodge and Chrysler. A strike would help clear the lots of many dealers.

Biden will face a political liability if the prices of popular models increase. This would be another speed bump on the Federal Reserve’s path to lower inflation. The president, who does not have a formal role in these negotiations, said on Friday that he has been in contact with auto executives and union leaders, as well as dispatching two administration officials to Detroit.

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