UAW planning targeted strike of specific plants, sources say
Local United Auto Workers leaders were told in a call with leadership Tuesday night that the union plans a targeted strike of specific plants operated by each of the three Detroit automakers if the sides don't reach tentative agreements by the contract deadline, according to two sources familiar with the matter.
The UAW's strategy is slated to unfold if tentative agreements with each of the automakers aren’t reached by 11:59 p.m. Thursday when their current contracts expire.
UAW President Shawn Fain is set to have a 5 p.m. Facebook livestream on Wednesday, when he is expected to update members on negotiations and potential strike strategy. He’s already said the union will strike any company that doesn’t have a tentative agreement by the deadline.
Fain is slated to appear at a rally with U.S. Sen. Bernie Sanders, an independent from Vermont, in Detroit after the deadline on Friday, according to a flyer obtained by The Detroit News.
“The ultimate goal,” said Marick Masters, a management professor at Wayne State University, “is going to be, if they have to use a strike, is to strike in such a way that is going to get them the best deal from one of the companies in the shortest amount of time to take to the other companies as a template.”
Choosing to strike a single plant at each automaker at least initially could, as a result, save funds, but it has drawbacks, too.
“That’s a weaker form of the strike,” Masters said. “It takes longer to be felt. It depends on what rolls out in terms of affecting other production sites. It risks dividing the membership.”
Solidarity and standing united have been frequent phrases echoed by Fain and other UAW leaders at practice pickets, rallies and other events leading up to the deadline.
For a strike to be effective against a single plant, “it has got to have product that’s really critical,” Masters said. “There’s no magic number of plants. They would want to strike the plants that are going to maximize the impact on the company so that if they threaten the company with enough losses that they concede.”
How much the automakers could weather strikes partly depends on inventories. In a post shared earlier this month, Michelle Krebs, senior analyst at auto information resource Cox Automotive Inc., said Stellantis' inventories were "bloated" and the highest in the industry. At the end of July, Jeep was at 95 days of supply, Ford was at 77, GMC was at 66 and Chevrolet was at 51, below the industry average of 58 days.
Oftentimes, the most impactful action is a national strike, Masters said. In 2019, all UAW-represented employees at GM went on strike for 40 days. It cost GM $3.6 billion, the company said.
That contract ultimately resulted in two 3% wage gains, a timeline for rolling over temporary workers to full-time positions, a record $11,000 ratification bonus and saving the Detroit-Hamtramck Assembly Plant from closure.
But after four more years of major profits, though, UAW leaders say the time is now to recover what was bargained away to save the companies during the Great Recession and bankruptcies. Its initial proposal from more than a month ago sought a 46% wage increase (40% not compounded), though that request since has dropped at least to 36% not compounded.
It also has been demanding pensions and retiree health care for all workers, 90 days for full-time workers to get to the top pay and cost-of-living wage adjustments. Fain on Monday on CNN characterized the progress as "slow."
GM President Mark Reuss called these labor negotiations "truly historic" at the Automotive News Congress event in Detroit on Tuesday: "We've made a lot of progress over the last few days.
"From a GM standpoint, we're here to win, and this is a very intense marketplace. The goal is to reward our team members, our employees, our stakeholders, and we also have to invest in the future, which we're doing in that intense marketplace to win."
If the union does strike all three, it’s on the hook to pay about 145,000 members a $500 stipend per week. Although its Strike and Defense Fund sits at more than $825 million, it would cover up to 11 weeks of strike pay — not factoring in additional expenses related to health care for striking workers or other ongoing strikes in which the union is involved.
There’s a significant impact on the greater economy, as well: Anderson Economic Group estimates a 10-day strike at all three companies could cost the U.S. economy $5.6 billion.
X: @bykaleahall
X: @BreanaCNoble