[1/2]The GM logo is seen on the facade of General Motors headquarters in Detroit, Michigan, United States, March 16, 2021. Picture taken March 16, 2021. Portal/Rebecca Cook// EARN LICENSE RIGHTS
DETROIT, Oct 20 (Portal) – General Motors (GM.N) increased its offer to striking auto workers on Friday, matching Ford’s (FN) proposed 23% wage increase and other benefit improvements, hours before union boss Shawn Fain was scheduled to speak on negotiations.
“We have made significant progress in all key areas to reach a final agreement with the UAW and get our people back to work,” GM said in a statement as the strike entered its fifth week.
“The majority of our workforce will earn $40.39 per hour, or approximately $84,000 per year, through the end of the term of this agreement,” it said.
Shares of GM rose 1.4% and Ford’s rose 1.1% in afternoon trading.
More than 34,000 union members from the three automakers have been on strike since the strikes began on September 15th.
GM’s latest offer shows Detroit automakers agreeing to similar deals that would increase UAW workers’ hourly wages by about 30% over the life of the deal, including living expenses. Ford, which had the best offer among the three, said it was at the limit of what it could pay and remain competitive.
The union held its first simultaneous strikes against the Detroit Three automakers and opened negotiations demanding a 40% wage increase. The demand included an immediate 20% increase, the elimination of differential wage rates for UAW employees and the restoration of defined benefit pension plans. The union is also demanding that battery factory workers be covered by union agreements.
The GM offer “suggests we may be at the end,” said Harley Shaiken, a labor professor at the University of California, Berkeley. “In fact, Ford specified the dimensions of the sample, but GM contributes to it. We still have a long way to go, but there is clearly movement.”
Progress in the talks followed the UAW’s surprise strike last week at Ford’s largest truck plant in Kentucky, which generates $25 billion in annual sales and accounts for about a sixth of the company’s global automobile sales.
Fain had described the Kentucky strike as a warning to GM and Chrysler parent company Stellantis (STLAM.MI), saying the union was prepared to strike at GM’s Arlington, Texas, assembly plant, which produces the Cadillac Escalade, Chevy Suburban and Other large, state-of-the-art vehicles manufactured are inexpensive SUVs.
GM said the new 23% general wage increase offer represents a 25% wage increase over the life of the agreement, with a 10% increase in the first year. With the cost of living rising, the offer is over 30%. GM’s previous offer was for a 20% salary increase.
Additionally, the company is now offering an hourly wage of $21 for temporary workers, compared to the previous offer of $20.
The UAW said in a statement that Fain will go live on Facebook at 4 p.m. ET to update members on the negotiations after a week of “intense negotiations” with the Big Three.
Ford declined to comment on GM’s offer and Stellantis had no immediate comment.
Ford has not yet discussed the joint venture battery factories being covered by the framework agreement, Shaiken said. “Of course GM wants to reach an agreement, but Ford believes there is a good pattern to start with.”
Instead of the hammer blow of a mass strike that the UAW has carried out in the past, the union is strategically playing companies off against each other and using the relief from the expansion of work stoppages as encouragement at various automakers.
Automakers have said union demands would significantly increase costs and hinder their electric vehicle ambitions, putting them at a disadvantage compared to Tesla, the electric vehicle leader, and foreign brands like Toyota, which are not unionized.
On Monday, Ford CEO Bill Ford warned of the strike’s growing impact on the automaker and the U.S. economy.
Total economic losses from the UAW strike are $7.7 billion, with the Detroit Three suffering $3.45 billion in losses, according to the latest data from economic consulting firm Anderson Economic Group.
Reporting by Joseph White in Detroit and Abhijith Ganapavaram in Bengaluru; Additional reporting by Ben Klayman in Detroit and Pratyush Thakur in Bengaluru; Writing by Sayantani Ghosh; Editing by Sriraj Kalluvila, Peter Henderson and David Gregorio
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