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Wednesday, September 27, 2023

United Auto Workers’ contract talks with Detroit automakers heat up as strike threat looms

Alliance for Automotive Innovation President and CEO John Bozzella discusses the challenges facing the U.S. electric vehicle market on “Cavuto: Coast to Coast.”

Contract negotiations between the United Auto Workers (UAW) and Detroit's major automakers are heating up as the union continues to double down on its threats to strike against any or all of the three with the deadline fast approaching.

The labor union is seeking a 40% pay raise over the four-year contract and an array of additional benefits for its 146,000 workers at Ford, General Motors and Dodge parent Stellantis, whose latest offer the UAW rejected this week.

Ticker Security Last Change Change %
GM GENERAL MOTORS CO. 34.16 -2.10 -5.79%
F FORD MOTOR CO. 12.16 -0.57 -4.48%
STLA STELLANTIS NV 18.47 -0.30 -1.60%

In a Facebook video Tuesday, UAW President Shawn Fain held up a copy of the Stellantis proposal and threw it into the trash, calling it "a slap in the face." He went on to warn automakers that "the clock is ticking" and his members at the Big Three are prepared to walk off the job if a deal is not reached when their contracts expire Sept. 14.


UAW is threatening to strike as early as Sept. 15 at any of the Big Three automakers if their contract demands are not met. (AP Photo/Paul Sancya/File / AP Images)

Two people briefed on the matter told Reuters that automakers have estimated that the UAW's contract demands could raise the current mid $60-per-hour labor rate to more than $150 per hour. The union says the Big Three can afford it but two of the carmakers have pushed back publicly on the UAW's demands.


Stellantis said in a statement last week that it intends to fairly reward employees for their contribution to the company's success but added, "It will be critical to find common ground that doesn’t jeopardize our ability to continue investing in the affordable products, services and technology that our customers want and that would allow us to continue providing good jobs here at home."

GM said in its latest statement on the negotiations that "The breadth and scope of the Presidential Demands, at face value, would threaten our ability to do what’s right for the long-term benefit of the team."

ford employee works in plant

Ford employs more hourly UAW workers than any other automaker in the U.S. (JEFF KOWALSKY/AFP via Getty Images / Getty Images)

Ford, which employs more hourly UAW members than any other automaker, told FOX Business Thursday in a statement, "We look forward to working with the UAW on creative solutions during this time when our dramatically changing industry needs a skilled and competitive workforce more than ever."


Whether a strike occurs or not, auto production could be hurt further if the UAW's scheduling demands are met, according to auto dealer Tom Maoli.

"What they're looking for is to cut their work week back to 32 hours," Maoli said. "That's a production issue. And if they cut production any further, this car industry is in trouble because there is no production today – we're still trying to recover from the chip crisis."


New vehicles are shown parked in storage lots near the Stellantis Detroit Assembly Complex. The UAW this week rejected the company’s latest proposal as the two sides negotiate a new contract. The current contract expires Sept. 14. (AP Photo/Paul Sancya / AP Newsroom)

Consumers can also expect that the increased cost of raises and other benefits under any new contracts will be passed along to them at a time when new car prices are already at an all-time high.


FOX Business' Lydia Hu reported new data from Kelley Blue Book that shows the average price for a new car is higher than $48,000, and with the average interest rate for a car loan at 7.2%, Americans are now paying a record $736 per month on average for new vehicles.

FOX Business' Lydia Hu, the Associated Press and Reuters contributed to this report.

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