The United Auto Workers is giving Ford Motor Co., General Motors Co. and Stellantis NV a break from new walkouts this week as contract talks progress.
(Bloomberg) — The United Auto Workers is giving Ford Motor Co., General Motors Co. and Stellantis NV a break from new walkouts this week as contract talks progress.
UAW President Shawn Fain said Friday his union was prepared to expand its strike to a GM plant making high profit margin SUVs in Arlington, Texas, but reached a last-minute deal with the carmaker to include battery plant workers in a new national labor contract.
“GM has agreed to lay the foundation for a just transition” to the age of electric vehicles, Fain said in a livestreamed briefing.
Shares of all three automakers rallied in afternoon trading. GM rose 2% in New York, while Stellantis climbed 3% and Ford rose 0.8%. GM and Ford had seen steep declines since July amid uncertainty about the negotiations. Stellantis is the outlier, up 37% so far this year.
The UAW had been steadily escalating its strike as negotiators haggle over issues including wages, pensions and future battery plant workers. It’s the first time in three weeks that the strike hasn’t been widened to include new plants.
“We don’t strike for the hell of it,” Fain said.
About 25,000 union workers have walked out of five assembly plants and 38 parts-distribution facilities since the strike began Sept. 15. Those plants remain on strike. But that represents just one-sixth of the UAW’s membership, leaving Fain with many levers left to pull if he wants to inflict more damage on the companies and their supply chains. His strategy has been to keep them guessing about his next move while minimizing the hit to the union’s strike fund.
This is the first time in its 88-year history that the UAW has targeted all three carmakers simultaneously. Each company is negotiating separately with the union on a new contract, but they’re closely watching each other’s moves and the UAW is weighing their offers against each other.
In the past week, Ford and GM submitted new proposals to the UAW that included better wages and retirement benefits, respectively. Fain said Friday that Ford’s latest offer includes a 23% pay raise, higher than the 20% from GM and Stellantis.
The union wants to emerge from the strike with at least a 30% pay raise, down from the 40% increase it initially sought. Ford’s proposal — combined with a cost of living allowance to account for inflation — is likely to meet that threshold, according to a person familiar with the matter.
Ford Chief Executive Officer Jim Farley last week accused Fain of holding an agreement hostage over battery plants, which are mostly joint ventures and haven’t been constructed yet. Those ventures aren’t accounted for in the contract that expired last month.
Ford said Friday that it’s “open to the possibility of working with the UAW on future battery plants in the US, reminding that these are multibillion-dollar investments and have to operate at sustainably competitive levels.”
GM said it continues to address outstanding issues with the UAW. At Stellantis, Mark Stewart, the chief operating officer for North America, told employees Friday that “while we still have some work to do, I remain optimistic that our discussions are providing a pathway to a tentative agreement.”
The UAW also is seeking, among other things, the return of traditional pensions, which the companies say they can’t afford. Fain said Friday the talks are making progress, but held out the threat of more walkouts if comprehensive deals can’t be reached.
(Updates with company comments beginning in 12th paragraph.)
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