Impact of UAW Strike Against Big Three US Automakers Spreading

The impact of the strike launched by the Detroit-based United Auto Workers (UAW) against the Big Three U.S. automakers is spreading as the strike enters the sixth day.

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General Motors (GM)is idling its Fairfax plant in Kansas where 2,000 hourly employees work, as a result of the impact of the UAW strike at its Wentzville Assembly Plant in Missouri.

"It is unfortunate that the UAW leadership's decision to call a strike at Wentzville Assembly has already had a negative ripple effect, with GM's Fairfax Assembly plant in Kansas being idled today and most of its represented team members leaving the plant as there is no work available," the Detroit News quoted GM as saying in a statement Wednesday.

The layoff is due to a shortage of stamped parts supplied by Wentzville's stamping operations to Fairfax. Employees will not receive supplemental pay from GM while they're laid off. Ford Motor Co. and Stellantis NV face the same problem.

On Wednesday, Stellantis said it was immediately laying off 68 workers at its machining plant as a result of the UAW's strike at its Toledo Jeep plant in Ohio. Hundreds more at the Toledo machining facility could be laid off soon if the strike does not stop.

The automaker further anticipates another estimated 300 layoffs at Kokomo Transmission and Kokomo Casting plants in Indiana, Stellantis spokesperson Jodi Tinson said. Ford already temporarily laid off the rest of 600 workers at its Michigan Assembly Plant in Wayne.

Unifor, a union representing the Big Three U.S. autoworkers in Canada, and Ford had struck a tentative agreement Tuesday night in the 24-hour extended negotiations after their previous contract expired at Monday midnight, averting a strike for the Dearborn-based automaker.

Details on the deal won't be released until after they are shared with Unifor members at ratification meetings to be held "in the near future."

The deal between Unifor and Ford put additional pressure on the UAW's negotiations with the Big Three U.S. automakers, which have yielded no significant breakthroughs by Wednesday.

Besides a 20-percent wage increase offered last Thursday, GM's current offer to the UAW comes with no plant closure. GM President Mark Reuss called his company's contract proposal a record offer, saying the union's demands would be "untenable."

The UAW is spreading "myths" about what GM can afford and what it's offering, Reuss said. GM's offer "recognizes the many contributions our represented team members make to our company - past, present and future."

GM is addressing the tiered-wage system. The Big Three have proposed cutting the time it takes to get to the top rate to four years from eight, Reuss said, adding that GM is pushing to have an all-electric lineup in 2035, and is "at a pivotal point in our journey as we transition to an all-EV future."

"As we started our transformation to EVs, we made sure we had work for the entire manufacturing team so we could bring everyone along on our transformation."

UAW President Shawn Fain insisted that the 20-percent not-compounded wage increases offered by automakers are "not enough" after what the union sacrificed during the bankruptcies of GM and Chrysler LLC, now part of Stellantis.

He particularly targeted GM CEO Mary Barra who made nearly US$29 million in 2022, saying the ratio of Barra's compensation to that of a median employee is estimated to be 362 to 1.

The UAW originally requested 40 percent not-compounded or 46 percent compounded wage increases, which have dropped to 36 percent. The union also demands an end to wage tiers.

If the union does not see serious progress in negotiations with Ford, Stellantis, and General Motors, it will spread the strike to more plants on Friday, said Fain.

It's clear the Big Three U.S. automakers and the UAW are far apart in talks, the Detroit News quoted Marick Masters, a business professor at Wayne State University. Unless the union pulls back on some of its demands, getting a deal with GM will be difficult, he said.