UAW Negotiator Says New Stellantis Offer Doesn’t Look Good

Stellantis NV’s new contract offer to the United Auto Workers lacks the job security guarantees the union wants, a negotiator said, suggesting workers will reject it days before a deadline to expand their historic strike.

(Bloomberg) — Stellantis NV’s new contract offer to the United Auto Workers lacks the job security guarantees the union wants, a negotiator said, suggesting workers will reject it days before a deadline to expand their historic strike.

UAW President Shawn Fain has yet to announce whether he’ll green light the latest Stellantis offer, but the proposal had a similar pay increase to the 19.5% already offered. Additionally, it doesn’t give workers the clear vision of the future they’re seeking, said Scott Moldenhauer, a negotiator for the union.

“It didn’t look good for us,” Modenhauer said while walking the picket line Wednesday outside Stellantis’ North American headquarters in suburban Detroit. “The holdup is product. They didn’t want to line up products for our plants for the future.”

The new Stellantis offer is being reviewed, said the union, without providing details of the proposal. A spokeswoman for Stellantis, the maker of Jeep SUVs and Ram pickups, said the company “officially passed a fifth offer yesterday, which focused on subcommittee open issues.” 

General Motors Co. isn’t having an easy time finding a deal, either. GM Chief Executive Officer Mary Barra told the automaker’s salaried staff Wednesday morning that the union’s salary demands were too costly. The company’s current offer would raise average yearly compensation to $150,000 a year with benefits, according to people familiar with the matter. And while GM continued bargaining, the people said the two sides were far apart. 

Read More: GM and UAW Remain Far Apart, CEO Barra Calls Demands Too Costly

Mercedes Walkout

The labor actions spread beyond Detroit for the first time as 190 UAW workers struck a ZF plant in Tuscaloosa, Alabama, that supplies front axles for Mercedes-Benz Group AG vehicles. While the UAW represents part supplier plants, these locals make their own decisions about job actions and have contracts that differ from the ones governing Detroit’s autoworkers. But the local is striking over some of the same issues, such as equal pay for all workers in the same plant.

The job action followed a UAW social media post Tuesday evening with a Spartacus movie clip showing “UAW locals waiting to go out on strike” as the title character’s fellow rebels in turn each stand and claim, “I am Spartacus.”

Stellantis said Wednesday it will temporarily lay off 68 employees at its Toledo machining plant in Perrysburg, Ohio, as a result of the UAW strikes. And GM idled an assembly plant in Fairfax, Kansas. 

The UAW will have a Facebook Live event on Friday at 10 a.m. in Detroit, where it will likely discuss whether additional plants belonging to the city’s legacy carmakers will face strikes, a person familiar with the discussions said. 

Fain has said more of these plants face walkouts if GM, Ford Motor Co. and Stellantis don’t sweeten their offers. 

The new job actions and Friday deadline raise the stakes for talks between three of the biggest automakers in the US and the union representing 146,000 of their workers. Friday will mark one week since the UAW called its first-ever walkout across all three of the legacy Detroit manufacturers.

In Canada, Ford reached a tentative agreement late Tuesday with Unifor, the Canadian autoworkers’ union, for a three-year national labor contract, though the company did not disclose specifics on the deal. 

“When faced with the prospect of an all-out strike by 5,600 Unifor members at every single one of Ford’s facilities in Canada, the company made a significant offer,” the union said in a statement. 

Read More: What’s at Stake as US Autoworkers’ Strike Drags On: QuickTake 

Strike Impact

There were conflicting reports as to how the strike was affecting supplies. S&P Global Mobility estimated that the strike is costing the companies output of about 3,200 vehicles a day.

But on Tuesday, Stellantis’ North American Chief Operating Officer Mark Stewart told CNBC that his company has inventory on hand to offset the strike’s impact. Cox Automotive reported that the auto companies turned out cars at a fast clip ahead of the strike, leaving them with the highest inventory level since April 2021.

Jonathan Smoke, Cox’s chief economist, said that the UAW’s “start and stop” plant-by-plant strategy could “stretch this strike out longer than experienced in the past, but also have less of an immediate volume impact.” 

A UBS note Tuesday cited Marc Robinson, principal consultant of MSR Strategy, as saying it could take eight weeks for there to be a strike resolution. 

–With assistance from Gabrielle Coppola.

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