Top executives at Ford Motor Co. and General Motors Co. voiced sharp criticism of the leadership of the United Auto Workers on Friday as the strike at all three Detroit automakers continued into its 15th day and spread to new plants at Ford and GM.
Ford CEO Jim Farley accused the union of “taking hostage” the deal for the automaker’s four planned electric vehicle battery factories in the United States.
And GM CEO Mary Barra claimed in a statement that the UAW had “no real intention of reaching an agreement.”
The comments came after the union expanded its strike to include two more plants: the Ford assembly plant in Chicago, which builds the Explorer, a police utility vehicle, and the Lincoln Aviator; and General Motors Co.’s Lansing Delta Township Assembly Plant, which builds the Buick Enclave and Chevrolet Traverse. In total, about 25,300 of the approximately 146,000 Detroit Three workers represented by the UAW are on strike across the country as the historic walkout enters its 15th day.
“Here’s the bottom line from Ford’s perspective,” Farley said during a news conference Friday. “First, Ford offered an incredible contract that would change the lives of over 57,000 workers for the better.” Second, we believe the UAW is maintaining the deal on battery factories that won’t come online for two to three years. And finally, we still have time to reach an agreement and avert a real catastrophe – but not much time left, given the fragility of the supply base.”
Ford officials noted that the company has offered a number of contract improvements, including wage increases of more than 20% over the life of the contract, cost-of-living subsidies and health insurance that they say would put workers in the top 1% . of all Americans, enhanced pension contributions, more time off, layoff protections for permanent employees and product commitments for all UAW-represented plants in the United States, among other things. They said the company had “continued to negotiate and improve its offer” since September 12, when Ford submitted a proposal in advance of the strike.
“The deal we are offering would put our UAW workers in the highest-paying hourly manufacturing jobs in the world and in the top 30% of full-time workers in America across all industries, whether hourly or salaried,” Farley said. “ Record deal? No problem. Mortgage our future? That’s a big problem, we’ll never do that.”
Ford claims that agreeing to all of the union’s demands – including the reinstatement of defined benefit pension plans for all workers, higher wage increases than Ford stated and additional job security provisions – would result in billions of dollars in additional costs that would and may make the company uncompetitive even unprofitable.
“A bad deal now would jeopardize midsize and more expensive, larger vehicles like the Escape and Explorer,” Farley said. “We would have to choose to cut future investments in these products, restructure and reduce our headcount across the company, including UAW workers. What’s really frustrating is that I think we could reach a compromise on wages and benefits, but so far the UAW is holding the deal hostage over battery factories.”
Meanwhile, Barra pointed to what GM described as a “historic contract offer” that includes a 20% wage increase, including a 10% increase in the first year, salary increases for temporary workers and a halving from eight to four years in order to move to the top of the pay scale To achieve this, full-time employees are required.
“It is an offer that rewards our team members but does not put our company or their jobs at risk. Putting our future at risk is something I will not do,” Barra said. “It is clear (UAW President) Shawn Fain wants to make history for himself, but that cannot be to the detriment of our represented team members and the industry. Serious negotiations take place at the table, not in public, with two parties who are willing to roll up their sleeves to get a deal done.”
The UAW responded to her comments in a social media post, saying neither Barra nor Farley attended the bargaining sessions this week.
Discussions about the battery plant
According to Ford executives, this involves negotiations over four battery factories that Ford is building in the United States. Three are part of a joint venture with South Korean battery manufacturer SK On. One of those plants will be built in Tennessee next to a Ford-owned electric vehicle assembly plant. the other two are built in Kentucky. The fourth plant in Marshall would be a wholly owned Ford subsidiary that would assemble lithium iron phosphate batteries using technology licensed from Chinese battery manufacturer Contemporary Amperex Technology Co. Limited (CATL).
More: Ford pauses construction of electric vehicle battery plant in Marshall
“Remember, these battery factories don’t exist yet. Most of them are joint ventures. And they haven’t been organized by the UAW yet because the workers haven’t been hired yet and won’t be in the coming years,” Farley said. “They won’t scale until the next contract.”
The plants in the south are scheduled to open in 2025; The Marshall plant, which Ford confirmed this week it would halt construction on, was originally scheduled to open in 2026.
Without going into details, Ford executives said the UAW was seeking to include the battery plants in the framework agreement between the company and the union.
Reflections on the Marshall Project
Farley said Friday that Ford does not intend to cancel the Marshall project, but that it is reevaluating the scope based primarily on three factors: labor costs, the final language of the Inflation Reduction Act and what the next contract with the UAW will look like impacting the company’s ability to invest in the products the plant would deliver. The project faced strong opposition at the local level and drew scrutiny from Republican lawmakers at the state and federal levels over the licensing of technology from a Chinese company.
“Politics is not part of this calculus,” Farley said. “It’s a $3.5 billion investment, thousands of workers, and we have the ability to make it bigger or smaller.”
Where the negotiations are
Fain said Friday that talks with Detroit automakers had not broken down, and Ford officials appeared to agree with that assessment, although it was clear that the union remains far removed from the companies on some key issues.
“The discussions about the battery factory were very difficult and we felt from the beginning that the regional strike was premeditated and that everything was taking far too long, that events are actually predetermined before they happen,” Farley said. “I don’t think so. We don’t think we’ve reached the point where we’re at an impasse, but that deadline could come if this continues.”
Ford executives said they believe they are “very close” to the economic proposals but view the battery plant talks as a sticking point.
The UAW, however, disputed that characterization.
“I don’t know why Jim Farley is lying about the status of the negotiations. It could be because he didn’t show up for negotiations this week, as he has for most of the last ten weeks. If he were there, he would know that we made a comprehensive proposal to Ford on Monday and still have not received a response,” Fain said in a statement.
“He would also know that we are far apart on key economic proposals such as pension security and post-retirement health care, as well as job security in this transition to electric vehicles, which, according to Farley himself, will eliminate 40 percent of our members’ jobs.”
Ford officials said in remarks Friday that they do not expect short-term job losses from the shift to electric vehicles.
Speaking to reporters outside the GM plant in Lansing Delta Township shortly after Friday’s strike, Fain called Ford executives’ comment “not true” and “sad.” He said the statements were “ironic” considering Farley had only attended three negotiating meetings: “That’s just for show in my opinion.”
He also pointed to UAW-represented workers at a GM-LG Energy Solution joint-venture battery plant in northeast Ohio that until recently began earning $16.50 an hour.
“This is not a just transition for anyone and our tax dollars are funding this transition,” Fain said. “If taxpayers are funding this transition, there is no excuse for these to be poverty jobs.”
Staff writer Beth LeBlanc contributed.