As contract talks begin with Ford, GM and Stellantis, the UAW is showing a willingness to try new strategies and discard the status quo as it seeks meaningful gains.
DETROIT — One of the few certainties about this year’s contract talks between the UAW and the Detroit 3 is that they will be far from routine.
With two months to go before the pacts expire, union leaders are bucking tradition and employing new tactics to win meaningful gains for members in what President Shawn Fain has called this generation’s “defining moment.”
The union’s newly elected leader this week ditched a decades-old handshake tradition with company CEOs in favor of rank-and-file meet-and-greets. And he suggested that he won’t follow the usual formula of picking a lead company but will instead target — and potentially strike — all three at once.
Across the bargaining table will be auto executives determined to avoid major labor cost increases so they can remain flexible and competitive amid a costly pivot to electric vehicles. But top union officials believe they’re in the strongest position in decades to win back the concessions made during the recession that sent two of the Detroit 3 into bankruptcy.
“The membership’s ready,” Fain told Automotive News as he met workers outside Ford Motor Co.’s Michigan Assembly Plant after visiting General Motors and Stellantis plants earlier the same day. “They’re fed up and tired of being marginalized and regressing and not moving forward.”
The union’s demands include pay raises, the restoration of pensions and cost-of-living adjustments, the end of the two-tier wage system and use of temporary workers, and assurances that new EV battery plants will be unionized.
Fain, speaking to members this week on Facebook Live — a platform that has quickly become his preferred method of communication — vowed to aim high and deliver.
“We’ve got to stop this can’t-do mentality,” he said, invoking a Malcolm X quote about fighting for freedom. “The question I need you to think about is, ‘How far are you willing to go to win the contract you deserve?’ ”
It increasingly appears likely that the answer to Fain’s question will involve a work stoppage.
Union leaders have hinted at it for months, saying they’re prepared to walk off the job if the automakers won’t give workers a fair contract.
Fain reiterated that stance this week.
“The strike target is the Big 3,” he said on Facebook Live. “If the Big 3 are not going to come to the pump for workers, there’s going to be issues.”
Steve Brown, senior director at Fitch Ratings, said negotiations this year are likely to be “especially difficult,” creating an elevated possibility of a strike at “one or more” automakers.
“Workers across the U.S. economy have seen substantial compensation increases over the past several years, while UAW-represented workers have been paid according to a contract that was ratified before the pandemic,” Brown said in a statement. “We expect the UAW’s new leadership will want to prove itself to the rank-and-file membership by trying to squeeze everything it can from the automakers.”
Colin Langan, an analyst at Wells Fargo, said in a July 7 investor note that he sees a “growing possibility” of the union abandoning traditional pattern bargaining and targeting each of the Detroit 3 with strikes.
“The hope of striking at all three would be to pressure all and reach a deal with the most accommodating company,” Langan wrote. He anticipates at least a 10 percent upfront wage increase as part of any potential deal.
The automakers are likely open to wage increases but are expected to balk at many of the union’s demands, including reinstituting cost-of-living adjustments.
Ford CEO Jim Farley, in a Detroit Free Press op-ed this month, said UAW-Ford workers have made more in profit-sharing and inflation bonuses over the past four years than the old cost-of-living formula would have given them. Ford spends an average of $112,000 on wages and benefits per hourly worker, he said.
Ford, according to company sources, is expected to prioritize manufacturing flexibility as it spends billions developing EVs.
The Dearborn automaker has a roughly $1 billion U.S. labor cost disadvantage compared with GM and Stellantis, sources say, because it employs more UAW members and builds more vehicles in this country than they do.
Ford has roughly 57,000 U.S. union workers, about 11,000 more than GM and 16,500 more than Stellantis. It has created or retained 14,000 UAW jobs — 5,600 more than promised — since signing its current contract with the union in 2019.
The automaker also has invested $1.4 billion more than it agreed to in writing and converted roughly 14,100 temporary workers to permanent status since 2019.
Fain insists the automakers can afford the union’s demands, pointing to their collective $250 billion in profits over the past 10 years.
Since being elected in March, he has indicated he is willing to try unconventional tactics and take a more aggressive, militant tone against the Detroit 3 to get results.
That includes forgoing the usual handshake photo-ops with the CEOs he has criticized for getting multimillion-dollar salaries. By visiting plants instead, Fain is attempting to distance himself from his predecessors who he believed had a too-cozy relationship with employers.
“I’ll shake hands with the CEOs when they come to the table with a deal that reflects the needs of the workers who make this industry run,” Fain said.
MICHAEL MARTINEZ
UAW President Shawn Fain is forgoing the usual handshake photo-ops with the CEOs he has criticized and is visiting workers at plants instead.
The plant visits also are meant to showcase a more accessible UAW International Executive Board and rally the rank-and-file around a common message — something past union leaders failed to achieve and that is a priority for Fain, who was elected with the support of just 7 percent of the union’s membership.
Union reps handed out cards for members to sign and provide contact information to get updates on negotiations. They also handed out posters proclaiming “End Tiers” and “United for a Strong Contract.”
Valerie Bivings spoke with Fain last week at GM’s Factory Zero plant, where she tests EV batteries as a pack electrical tester. The former Detroit-Hamtramck assembly plant was renamed in 2020 when it became GM’s first all-EV production site.
Bivings’ job is part of GM Subsystems Manufacturing, a subsidiary that operates under a separate contract than GM’s national agreement with the UAW. That contract also ends in September.
“I like a lot of things that he’s saying,” Bivings said of Fain.
So did Charles Taylor, a 28-year-old who assembles F-150 Lightning batteries at Ford’s Rawsonville Components Plant.
Taylor, who’s been working at the plant for two years, drove to Michigan Assembly to meet Fain this week. He said he’s seeking “justice” out of the upcoming contracts and likes the posture union leaders have taken.
“This is what I’ve been looking for,” Taylor said. “I really want to stand for something. To see the drive and initiative that the UAW and [Fain] has, it’s been really exhilarating.”
Lindsay VanHulle contributed to this report.
