by Rick Haglund, Michigan Advance
United Auto Workers union President Shawn Fain didn’t get the 40% raise his members were demanding at the Detroit Three automakers. He and his bargaining team didn’t win the 32-hour workweek the union was seeking.
And the UAW failed to achieve its goal of restoring traditional pensions and retiree health care benefits for hourly workers hired after 2007 in tentative agreements reached with Ford, General Motors and Stellantis (formerly Chrysler) after a six-week strike.
But what it did win in those contracts, which must be ratified by the union’s 146,000 autoworker members, was astonishing and historic. The pacts include a hefty 25% raise over four-and-a-half years, billions of dollars in new product commitments at Detroit Three plants, progress on ending the two-tier wage system and major inroads into its demand for what Fain calls “a just transition” to electric vehicles.
Fain even got President Joe Biden to join striking workers on a Michigan picket line, the first time a sitting president had done so.
Biden also met Fain and other UAW members on Thursday at the Stellantis Belvidere plant in Illinois that the automaker closed earlier this year. The union won the reopening of the plant under its new contract with Stellantis, saving 1,200 jobs.
The tentative contracts at the Detroit Three add $25 billion in economic benefits for its members, four times what the union won in the 2019 national contracts, according to Fain.
“We squeezed every penny we believed we could get out of these companies,” he said in a Facebook Live session on Wednesday. “It was a major victory for our movement.”
In what Fain said was a labor first, automakers also agreed to reimburse striking workers for at least a portion of wages lost during the UAW’s innovative “Stand Up Strike.”
“That’s how you know you won,” Fain said.
The fiery UAW president, who was little known outside the union when he was elected president seven months ago, said he’s just begun to fight. This year’s contentious negotiations are a warmup for 2028 talks when the union intends to push for contract improvements the union didn’t get this time, he said.
“We’re building our strike muscle for 2028,” Fain said.
The UAW’s stunning wins at the bargaining table have been widely hailed as a possible turning point for struggling blue-collar workers across numerous industries to finally achieve a middle-class lifestyle.
Autoworkers, both union and nonunion, have been hit particularly hard. Hourly wages in auto plants, adjusted for inflation, have fallen 10.2% since 2019, according to Labor Department figures cited by the Wall Street Journal.
The UAW has lost thousands of factory workers as automakers closed a staggering 65 plants over the past 20 years, according to the union. Those days are over, Fain said.
“In the new UAW, we’re not leaving anybody behind.”
Fain attributed the decline in wages largely to a weak UAW that was unable to win higher wages and benefits for its workers and was not successful in organizing nonunion automakers, such as Tesla and Toyota.
“Our union has gone in the wrong direction for decades,” he said.
But some are expressing concern that the lucrative new contracts could hobble domestic automakers, which face tough, lower-cost global competitors and an expensive transition to electric vehicles.
In an unusually gloomy statement, Detroit Regional Chamber President Sandy Baruah said the tentative contracts will add up to $1,000 in costs per vehicle by Detroit automakers and “make competing companies’ offerings more attractive.
“As the home of the Detroit Three and the most automotive manufacturing, Michigan will have to work overtime to send the message that it is open for business,” Baruah said.
No one knows what the long-run impact of the historic UAW contracts, good or bad, will be on the domestic auto industry and Michigan’s economy. But Detroit’s automakers have managed to earn record profits during the unprecedented COVID pandemic, subsequent massive supply chain disruptions and the highest inflation in 40 years.
It would seem the Detroit Three, which have far more competitive products and better management than they did when GM and Chrysler went bankrupt during the Great Recession, should be able to manage a boost in labor costs.
One prominent Wall Street analyst is even touting Ford and GM stock as an attractive investment opportunity.
But one thing is clear: the era of the UAW playing nice with Detroit’s automakers is dead. Fain stunned auto executives after his election as UAW president in March when he said multibillion-dollar corporations that didn’t give workers their fair share were “our one and only true enemy.”
And he hasn’t backed down since. Fain refused to participate in the traditional handshake with Detroit Three CEOs to kick off negotiations, instead instituting a “members handshake.” He sometimes wore a shirt that read, “Eat the Rich” during updates on Facebook Live, where he angrily tossed automaker contract proposals in a wastebasket.
Fain now has his sights set on organizing nonunion automakers. He believes workers at those companies will be more open to joining the UAW than ever after seeing the financial gains Detroit autoworkers have achieved.
It won’t be an easy task. Tesla CEO Elon Musk hates labor unions and will likely do just about anything to keep the UAW out. Musk, you may recall, reopened his California plan in defiance of COVID stay-at-home orders and dared local officials to arrest him.
And southern states, where most foreign automakers have located, are notoriously anti-union. Tennessee officials once threatened to withhold state financial incentives from a new Volkswagen plant if workers joined the UAW. They didn’t.
Days after the tentative Detroit automaker agreements were reached, Toyota and Honda announced pay hikes for their U.S. hourly employees. Other foreign automakers are likely to do so in an attempt to freeze out the UAW.
But its success at the Detroit Three at a time of widespread labor activism, puts the UAW in its strongest position in decades to organize other automakers.
The tentative contracts “taught companies not to underestimate us,” Fain said. “We win when others see what we achieved and stand up for themselves.”
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