The four-year labor agreement between the union and General Motors (GM.N), Ford Motor (F.N), and Chrysler-parent Stellantis terminated on Thursday at 11:59 p.m. EDT. Stellantis increased its offer on Saturday, providing rises of 20% over a four-and-a-half-year contract term, including an immediate 10% increase. That is consistent with GM and Ford’s recommendations.
The automakers claim the ideas amount to a cumulative 21% wage increase over the period, but they are still much less than the 40% salary increase sought by the UAW through 2027. The union’s salary demands include an immediate 20% raise.
“We do care. We absolutely do care,” Mark Stewart, Stellantis’ North American chief operating officer, told reporters on Saturday, calling the company’s current offer “very compelling.”
“This is not about greed. This is about sharing success,” he explained.
Stellantis also stated that it is offering more than $1 billion in retirement security enhancements and other benefit increases. Stewart stated that the UAW rejected a Stellantis proposal to keep an Illinois assembly factory operational if an agreement could be reached before the contract expired. He declined to provide specifics but noted that the business was still open to discussing the facility’s future.
‘GO THE DISTANCE’
Strikes have halted production at three Michigan, Ohio, and Missouri facilities that manufacture the Ford Bronco, Jeep Wrangler, and Chevrolet Colorado, among other popular models.
Automakers claim they want cost-competitive contracts due to the need to spend billions of dollars to transition to electric vehicles (EV), but workers point out that US automakers have enjoyed solid profits over the last decade and have increased CEO compensation by 40% on average since 2019.
GM (GM.N) informed some 2,000 workers at a Kansas car plant that their factory would probably be shut down next week due to a lack of parts, as a result of a strike at a Missouri plant, and Ford announced on Friday that it was indefinitely laying off 600 employees at a Michigan plant that makes the Bronco SUV.
The walkout at the Jeep facility in Toledo, Ohio, according to Stellantis, is not expected to affect any other plants, the company said on Saturday.
The reports of impending layoffs of non-strikers, according to UAW President Shawn Fain, are an effort by the manufacturers to “squeeze” union members into accepting a less favorable settlement.
“Their plan won’t work,” Fain declared in a statement. “We’ll organize one day longer than they can, and go the distance to win economic and social justice at the Big Three.”
As automakers transition to EVs, the UAW is calling for lower work weeks, the return of defined benefit pensions, and increased job security in addition to higher salaries. The union also wants the so-called “two-tier” system of pay to stop, although the auto industry has suggested reducing the time required to attain top pay levels from eight to four years. The UAW claimed that the automakers had denied numerous important demands.
The UAW demands, according to American manufacturers, may push up labor costs from their present mid-$60 per hour range to much over $150 per hour. On Thursday, GM estimated that the UAW’s proposed wages and benefits would cost the company $100 billion, while Jim Farley, CEO of Ford, claimed that the 40% wage increase would “put us out of business.”
American President Joe Biden, who is up for reelection in 2018, called on the car industry on Friday to reward employees as executive compensation has increased. “The companies have made some significant offers, but I believe they should go further to ensure record corporate profits mean record contracts,” he said.