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Autoworkers Give Green Light to Strike if Talks Break Down

The United Auto Workers (U.A.W.) union announced on Friday that an overwhelming 97 percent of its members have voted in favor of authorizing strikes against General Motors (G.M.), Ford Motor, and Stellantis if new labor contracts cannot be successfully negotiated. This gives U.A.W. President Shawn Fain the authority to call for a strike once the current contracts expire on September 14.

While strike authorization votes are typically a formality and do not always result in actual strikes, this vote is significant due to the U.A.W.’s more assertive approach toward automakers and the larger shift within organized labor. Over the past decade, G.M., Ford, and Stellantis have seen substantial profits, which has emboldened the U.A.W. and its members to demand better wages, improved benefits, and cost-of-living adjustments.

“This is our time to take back what we are owed,” President Fain declared during a Facebook Live session. “We are united, and we are not afraid.”

President Fain, who was narrowly elected this year in the U.A.W.’s first direct election of leaders, has successfully rallied the union’s members. He has been organizing rallies in Detroit and Louisville, with more events planned in the coming weeks. Such visible displays of unity have been rare during contract talks in the past two decades.

Luigi Gjokaj, Vice President at U.A.W. Local 51, expressed both nervousness and excitement, stating, “If the company comes to the table and they’re fair, we’ll have an agreement. If it has to go to a strike, we are prepared.”

Fain spoke at a rally near a Stellantis plant that produces the highly profitable Jeep Wagoneer, emphasizing, “We’re not asking to be millionaires. We just want our fair share.”

In response to the strike authorized by the U.A.W., Ford released a statement expressing its hope to work towards creative solutions while emphasizing the need for a skilled and competitive workforce in the rapidly changing automotive industry.

In his list of demands to the companies, President Fain included proposals such as working a shorter four-day week and a 40% increase in wages. Fain highlighted that the Chief Executives of G.M., Ford, and Stellantis have seen significant increases in compensation packages over the past four years. Currently, new hires at auto plants earn around $16 per hour and gradually work their way up to the $32 per hour earned by veteran workers.

G.M., Ford, and Stellantis have indicated their willingness to agree to higher wages in some form. In a recent development, an Ohio battery plant jointly owned by G.M. and LG Energy Solution agreed to increase wages for 1,900 U.A.W. workers by an average of 25 percent. This decision followed criticism from Fain regarding low wages at the plant. The plant, however, operates under a separate agreement.

As these negotiations continue, the three automakers aim to limit increases in labor costs, given their substantial investments in electric vehicles. They argue that accepting all or most of Fain’s demands would put them at a disadvantage compared to Tesla and other nonunion automakers.

President Biden expressed his concern about a potential strike and emphasized the importance of job security during the transition to electric vehicles. While the U.A.W. typically focuses on negotiating with one company before initiating a strike, no specific target has been named yet. Stellantis appears to be in the spotlight due to public disagreements between Fain and the automaker.

Despite the costs associated with transitioning to electric vehicles, G.M., Ford, and Stellantis have all reported healthy profits. G.M. announced an expected earning of over $9.3 billion this year, while Stellantis posted record earnings of 11 billion euros (around $11.9 billion) in the first half of 2021. Ford anticipates earnings before taxes ranging from $11 billion to $12 billion this year. These companies derive a significant portion of their profits from their North American operations.

Gerald Johnson, G.M.’s Executive Vice President for Global Manufacturing and Sustainability, emphasized in a video message to employees the importance of business profits in supporting long-term job security and opportunities for all.

The ongoing tensions between the U.A.W. and Stellantis, which was formed through the merger of Fiat Chrysler and Peugeot S.A., stemmed from the idling of a Jeep plant in Illinois. Fain’s primary objective is to convince the company to reopen the factory. Stellantis responded to Fain’s demands by proposing increased worker contributions to healthcare costs, reduced company contributions to retirement accounts, and the ability to temporarily close plants with minimal notice.

Mark Stewart, Stellantis’s Chief Operating Officer for North America, expressed dismay at Fain’s remarks and urged for a more productive negotiation process, stating that “theatrics and personal insults will not help us reach an agreement.”

As the U.A.W. and automakers enter into crucial negotiations, the outcome will have significant implications for the future of the American auto industry and the well-being of autoworkers. It remains to be seen how both sides will navigate the demands for better wages, improved benefits, and job security in the midst of a rapidly changing industry.

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