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What to know about a possible autoworkers’ strike

The United Auto Workers union, which represents about 150,000 workers at U.S. car plants, could strike on Friday at the nation’s three largest automakers if the union and companies are unable to reach new contracts.

If an agreement is not reached by midnight Thursday, the three automakers – General Motors, Ford Motor and Stellantis, which owns Chrysler, Jeep and RAM – could be forced to shut down or slow production. UAW President Shawn Fenn said Thursday was “a deadline, not a reference point.”

The union is negotiating a separate four-year contract with each automaker. The UAW has never attacked all three companies simultaneously, preferring to target one at a time. But Mr Fenn has said he and his members are prepared to strike against all three this time.

Compensation is at the forefront of negotiations.

The UAW is demanding a 40 percent pay increase over four years, which Mr. Fenn says is in line with how much the pay of companies’ CEOs has increased over the past four years.

Until last Friday, the two parties remained far apart, with companies offering pay increases of 14 to 16 percent over four years. Mr Fenn described that offer as “outrageous” and said the union was still demanding a 40 per cent pay rise.

The auto industry is in the midst of a widespread transition to battery-powered vehicles, and GM, Ford and Stellantis are spending billions of dollars to develop new models and build factories. Companies have said those investments make it harder for them to pay workers significantly higher wages. Automakers say they are already at a major competitive disadvantage compared to non-union automakers like Tesla, which dominates sales of electric vehicles.

The UAW is concerned that companies will use the switch to electric cars to cut jobs or hire more non-union workers. The union wants automakers to include battery factory workers in their national contract with the UAW. Right now those workers are either not represented by unions or are negotiating separate contracts. But automakers say they cannot legally agree to that request because those plants are set up as joint ventures.

The UAW most recently went on strike against General Motors in 2019. Approximately 50,000 General Motors employees walked out for 40 days. Car maker said it had to pay the price for the strike $3.6 billion,

The strike ended after the two parties reached an agreement that ended the two-tier wage structure under which new hires were paid much less than experienced workers. GM also agreed to pay workers higher wages.

A long pause in car production There may be a ripple effect in many parts of the US economy.

According to an estimate by Anderson Economic Group, a 10-day strike could cause a loss of $5 billion to the economy. A prolonged strike could affect car inventory at dealerships, leading to increased vehicle prices.

The auto industry is in a more vulnerable state than in 2019, the last time the UAW struck. In the first part of the pandemic, car production came to a halt, leading to a sharp reduction in the supply of vehicles. domestic car list They remain at about a quarter of where they were at the end of 2019.

It can definitely happen.

President Biden has called himself the “most labor union president” and sought to strengthen his ties with labor unions ahead of his re-election campaign. But the UAW, which generally supports Democratic candidates, including Mr Biden in the 2020 election support stopped him for the 2024 race.

The union fears Mr. Biden’s decision to promote electric vehicles could further reduce union membership in the auto industry. Mr. Fenn has criticized the administration for giving massive federal incentives and loans to new factories without requiring those plants to employ union workers.

Former President Donald J. Trump, who is most likely to secure the Republican nomination, is trying to win over UAW members. He has criticized Mr. Biden’s auto and climate policies as bad for workers and consumers.

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