Aug 10, 2023, 3:37pm EDT
net zero

Car manufacturers are headed for a labor showdown

REUTERS/Jonathan Ernst

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The News

Up to 150,000 hourly workers at General Motors, Ford, and Stellantis are prepared to strike in demand for a 40% wage increase and, as the industry pivots to electric vehicles, guarantees that the contracts at the new plants will be comparable in terms of salary and safety.

The fallout could have massive implications beyond Detroit. President Joe Biden has made his handling of the economy one of the central themes of his reelection campaign, and a protracted auto workers’ hold out — on top of Hollywood’s lengthy strike — could negate that.

We’ve gathered key reporting and analysis on the potential implications of an auto workers’ strike.

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  • Companies may agree to higher wages because they can afford those, but not to the union’s demands for a shorter work week or the ability to strike over plant closings. “The companies can’t afford anything that puts them in a straitjacket,” said Erik Gordon, a University of Michigan business professor, and with the pivot to EV, automakers will need “flexibility” to adjust or even close facilities. — The New York Times
  • Biden and the Democrats are caught between trying to gain the United Auto Workers’ support in 2024 voting efforts, while also addressing the UAW’s concerns over the administration’s push to EV. The union — which has not yet endorsed Biden’s reelection — may cause headaches for the administration that has tried to portray itself as the most pro-labor in history. — Politico
  • Late last year, an Ohio-based joint venture between General Motors and LG Chem became the first U.S. plant making electric vehicle batteries to unionize. The vote, which had the backing of 694 out of 710 voters, was heralded as a milestone event. Unionizing showed that workers at EV battery plants “want to be part of maintaining the high standards and wages that UAW members have built in the auto industry,” the union’s then-president said. — Financial Times