Detroit’s three major automakers failed to reach a new collective bargaining agreement before their contract with workers represented by the United Auto Workers expired at midnight Thursday, sparking one of the largest strikes in the U.S. in years.
UAW President Shawn Fain said in a Facebook Live address late Thursday that employees at three factories owned by Ford, General Motors and Stellantis would quit their jobs immediately. Factories include a GM assembly plant in Wentzville, Missouri; a Ford assembly plant in Wayne, Michigan; and a Stellantis assembly complex in Toledo, Ohio.
“Tonight we will be attacking all three Big Three at the same time for the first time in our history,” he said.
UAW President Shawn Fain, auto workers at the Ford assembly plant in Wayne, Michigan, early Friday. Detroit’s three major automakers failed to reach a new collective bargaining agreement before their contract with union members expired at midnight Thursday, sparking one of the largest strikes in the U.S. in years. MATTHEW HATCHER/AFP via Getty Images
About 12,700 employees of these institutions will take part in the industrial action. They will receive about $500 a week during the strike from the UAW’s $825 million strike fund, according to The Associated Press.
“The locals who have not yet been called to strike will continue to work under an expired agreement,” Fain said, while warning that workers at other plants may walk off their jobs if further talks with the automakers fail.
The walkout is the first strike at Detroit-based automakers since workers left GM in 2019.
“We will show our strength and unity on the first day of this historic action,” said Fain. “All options remain on the table.”
Britney Johnson, 35, who has worked for the company for about three and a half years, joined about 400 workers on the strike line outside the Ford plant in Wayne, in suburban Detroit. A mass rally was planned for Friday afternoon in downtown Detroit.
“I like the job,” she said. “It’s just that we deserve more.”
Expert ponders what economic impact the UAW strike could have 05:10
At the Jeep factory in Toledo, assembly line worker Candace Bowles, 52, was cleaning up her workstation and walking out as the midnight bell rang. “I’m really glad everyone stuck together,” she said.
Strategically, targeting just three plants will give the UAW the flexibility to potentially stop work at other plants when union officials resume negotiations with automakers. This will also preserve the labor group’s strike fund, according to Benjamin Salisbury, auto industry analyst at Height Securities.
Why the UAW is on strike
The UAW’s demands include a 36% raise on a four-year contract; retirement benefits for all employees; limited use of temporary workers; more paid time off, including a four-day week; and more workplace protections, including the right to strike during factory closures.
While talks remained at an impasse on Thursday, executives at Ford, General Motors and Stellantis (formerly Fiat Chrysler) said they had made several offers to the UAW in recent weeks in hopes of securing a new collective bargaining agreement for the 145,000 workers to complete a union.
“I think they’re preparing for a historic strike at all three companies,” Ford CEO Jim Farley told CBS News on Thursday.
What auto workers are demanding and what concessions automakers are making 07:13
Ford said in a later statement: “Tonight at 8 p.m. at Solidarity House in Detroit, the United Auto Workers presented its first substantive counterproposal to Ford, hours after the expiration of the current four-year collective bargaining agreement.”
What the car manufacturers say
In response to the strike order, Stellantis said it was “extremely disappointed by the UAW leadership’s refusal to engage responsibly to reach a fair agreement in the best interests of our employees, their families and our customers. We have ceased operations immediately. “We are in emergency mode and will make all appropriate structural decisions to protect our North American operations and the company.”
Stellantis, which was formed in 2021 from a merger of Fiat Chrysler and European automaker Groupe PSA, owns Chrysler, Dodge, Jeep and RAM, as well as major foreign car brands such as Citroën, Peugeot and Maserati.
GM CEO Mary Barra told CBS News on Friday that the auto giant had been negotiating in good faith with the UAW in hopes of averting a strike.
“We have been at the negotiating table since July 18,” Barra said, adding that GM initially received over 1,000 demands from the working group. “We have a historic offer on the table and are now ready to move forward.”
All Big Three leaders said they had made reasonable counteroffers and were ready to continue negotiating. Automakers say they are under pressure to keep costs and car prices low to compete with Tesla and foreign automakers, especially as the companies compete for share in the fast-growing electric vehicle market.
Barra said GM can’t meet all of the UAW’s wage demands because it needs to invest heavily in developing new products, particularly electric vehicles.
GM CEO Mary Barra defends her position amid the UAW strike, saying the company has four offers on the table 05:22
“We need to make sure the company will be successful for the next 115 years and that means we need to invest,” she said. “If we don’t invest and have new products that customers want to buy, it impacts the number of vehicles we build, which directly impacts how many people are part of our manufacturing team.”
“Their original offer was to pay our hourly workers approximately $300,000 each and to work four days,” Farley said Thursday of the UAW’s demands. “That would essentially bankrupt our company.”
Fain acknowledged that automakers have increased their wage offers, but the proposals remain inadequate, he said. Ford offered 20% over 4.5 years, while GM and Stellantis offered 18% and 17.5% over four years, respectively.
Analysts warn that the strike could disrupt the domestic auto industry, raise auto prices and lead to nearly $6 billion in lost wages and profits, while reducing overall U.S. economic growth by up to 0.3%.
Michael Pearce, senior U.S. economist at Oxford Economics, estimated that a strike by all 146,000 workers at the Big Three could halt nearly a third of domestic auto production. After a 54-day strike by GM workers in 1998, it took a year for vehicle inventories to recover, he noted in a report.
Biden: “Record profits were not shared fairly”
President Joe Biden sent two of his top aides to Detroit on Friday to help resolve the union auto workers’ strike. He expressed sympathy for the union by pointing out that while the three major automakers had made record profits, those record profits had not been shared fairly. with workers.
“Nobody wants to strike,” the Democratic president said in a brief speech at the White House. “But I respect workers’ rights to exercise their options under the collective bargaining system and I understand workers’ frustration.”
Striking General Motors workers with the UAW Local 2250 Union demonstrate outside the automaker’s Wentzville Assembly Plant in Wentzville, Missouri, on September 15, 2023. Michael B. Thomas / Getty Images
Mr. Biden said he was sending acting Labor Secretary Julie Su and her senior adviser Gene Sperling to Detroit to help secure a “win-win” deal for the companies and their employees.
Mr. Biden said he called on the first day of negotiations and encouraged both sides to stay at the table as long as possible.
“The companies have made some significant offers,” Mr. Biden said. “But I think they should go further to ensure that record corporate profits mean record contracts for the UAW.”
—The Associated Press contributed to this report
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Christopher J Brooks