United Auto Workers president rejects Stellantis wage increase offer

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(photo provided by Stellantis)

The president of the United Auto Workers on Sunday rejected a public offer by Jeep parent company Stellantis to boost pay 21 percent over four years, pushing a historic, coordinated strike against the nation’s three biggest carmakers into a third day.

Stellantis, which is based in the Netherlands and was formed in 2021 through a merger of Fiat Chrysler and France’s Peugeot, said Saturday that it had offered the union a “highly competitive” 21 percent wage increase. Stellantis employs about 7,000 people at plants in Kokomo and Tipton in Indiana.

The union said it had “reasonably productive” conversations with Ford on Saturday and was planning to meet with GM as well. Both of those companies have offered 20 percent raises over four years.

But on Sunday morning, UAW President Shawn Fain said that Stellantis’s 21 percent offer and other terms presented by the automakers aren’t sufficient and that the strike will continue.

“That’s definitely a no go,” Fain said on CBS’s “Face the Nation.” He added: “We’ve asked for 40 percent pay increases. And the reason we asked for 40 percent pay increases is because in the last four years alone, the CEO pay went up 40 percent.”

About 12,700 UAW members, or 8 percent of the union’s autoworkers, went on strike Friday, demanding pay increases and more-equal treatment and benefits for temporary workers, who have seen their pay lag behind full-time workers for years. It’s the first time the UAW has gone on strike against all three of America’s biggest automakers at once.

The strike comes as unemployment in the United States is at historic lows, but fallout from the pandemic and higher inflation have boosted worker anxiety. Companies have continued to post profits and increase executive pay, and the autoworkers are among a broad resurgence in union activity in the United States as workers from nurses to Hollywood script writers and actors seek better pay and job security.

Although the UAW strike affects only a handful of plants, Fain said the union was prepared to do “whatever we have to do” and expand work stoppages. “If we don’t get better offers and we don’t get down to taking care of the members’ needs, we’re going to amp this thing up even more,” Fain said.

‘Record profits’

Fain’s comments tempered any hope generated by the Saturday negotiations of a swift resolution. The union is asking for a 36 percent raise over four years, a four-day workweek, defined-benefit pensions and company-financed health care in retirement. The automakers have countered that their offers to the union are among the best in history, but that they can’t meet all their demands while still remaining profitable.

A spokesperson for Stellantis said the company would resume bargaining with UAW on Monday. Spokespeople for Ford and GM did not return requests for comment.

“It’s all of our hope that it will end sooner rather than later. But record profits have been generated,” said House Minority Leader Hakeem Jeffries (N.Y.), who was traveling to Detroit on Sunday. “It’s only fair that everyone share in those record profits in the prosperity that has been created.”

Over the weekend, workers gathered on picket lines at the plants where UAW had kicked off the strike. Spirits were high as supporters brought supplies and honked their car horns in solidarity.

“We want to become middle class again,” said Andrew Hudson, a striking production worker outside Ford’s assembly plant in Wayne, Mich., where the company makes Ranger trucks and Bronco SUVs. A few weeks ago, Hudson reached Ford’s top pay rate, $32 an hour, but it took him six years to get there. He’s on strike mostly because he doesn’t want his newer colleagues to have to wait that many years to get the top pay like he had to, he said.

“We can’t experience the American Dream that so many autoworkers before us, like my grandfather, got to,” said Hudson, whose grandfather was able to own a house and two cars while putting his kids through college on an autoworker’s salary. By contrast, Hudson said he and his co-workers are “struggling” to do the same on their own salaries.

Nicholas Harvey, 33, a single father who works in material handling, said he was on strike for higher pay. At $24.85 an hour, he said he had to move back in with his parents after his split with his wife. “This used to be a coveted job,” he said. “But I’m paycheck to paycheck. I want to own a house, put money away for [my kids’] college, but it’s hard saving.”

Battleground states

Meanwhile, the specter of the presidential election hovered over the strike, as politicians from both parties weighed in. President Biden and former president Donald Trump, the leading front-runner in the Republican contest, have taken contrasting approaches, with Biden saying the automakers should match their “record corporate profits” with “record contracts” for workers and Trump criticizing the UAW president. Biden said Friday he was sending two of his senior advisers to offer help in getting a deal done.

The Midwest states where auto plants are traditionally concentrated, including Michigan, are expected to be key battlegrounds in the 2024 election. But Rep. Debbie Dingell (D-Mich.) cautioned on Sunday that politicians should keep their distance. “I do not believe that the president should intervene or be at the negotiating table,” Dingell told CBS.

For his part, Fain has said another Trump presidency would be a “disaster,” but he has held off from endorsing Biden, saying the president must earn his self-styled moniker of the “the most pro-union president” in history.

Trump and other Republicans have criticized Democrats for pushing the country toward electric vehicles, many of which are not built in the United States. Democrats have said the companies need to consider their workers while pushing the transition to more climate-friendly cars. Chinese companies like BYD currently dominate the global electric vehicle market, and even U.S. companies like Tesla order their batteries, the key component of an electric car, from foreign manufacturers.

“Anyone that doesn’t believe global warming is happening isn’t paying attention,” Fain said Sunday. “But this transition has to be a just transition. As it stands right now, the workers are being left behind.”

The Big Three automakers have been ramping up their design and production of electric vehicles as Americans’ interest in buying the cars continues to grow. But a major strike could get in the way of that transition, and the traditional automakers’ ability to catch up to foreign competitors and electric-only producers like Tesla, said Dan Ives, an analyst with Wedbush Securities.

“A long and nasty strike … would be an absolute debacle for the Detroit Three,” Ives said. Any delay in ramping up their electric vehicle production will stand to benefit Tesla, which has been facing increasing competition from the traditional automakers, he added.

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12 thoughts on “United Auto Workers president rejects Stellantis wage increase offer

  1. Transition requires sacrifice. The big three auto makers know this and can’t stomach the risks being asked for by the UAW. The “record breaking profits” have grinded to a stop. Look at the dealership lots. Completely full of vehicles. The majority of people are not buying cars.

    1. The demands are short sided. If profits decline, will they go back to lower wages? Maybe they should ask for a retro active bonus. Wage increases are forever, partly why companies are laying off employees when they had no choice but to bump salaries. Now its time to get lean again.

    2. David, agreed especially with rise of EVs. It’s a weird time in the industry but not according to the UAW.

    3. If profits decline, will the CEO’s take a pay cut? I doubt it. Cars are sitting on lots because they are priced out of reach for the average person. When a CEO makes $55 a second, 24 hours a day seven days a week, that is immoral. Especially when the workers producing the product make as little as $16 an hour. The middle class has been declining for my entire life. Newsflash, when the middle class is gone, there won’t be enough wealthy elitists to buy cars to keep these companies in business. Caring for your employees is a win-win for everyone involved, including the CEO. Money is not the root of all evil. The LOVE of money is the root of all evil (see 1 Timothy 6:10).

    4. If the union demands are met, it would cost the auto companies
      $ 165.00 an hour per employee. That’s not sustainable by any stretch of the
      imagination. The non UAW manufacturers will kill them.

      The auto companies are already losing tens of thousands of dollars per EV
      vehicle produced. The profits on their trucks and SUV’s are going towards
      the EV’s.

      Second, does anyone really think the increased costs of producing vehicles
      won’t be passed on to the consumers???

      rates to make purchases are already approaching 2007 – 2008 levels
      along with the high cost per vehicle being manufactured. How is that going to
      work out???

      Think consumers will be able to afford those vehicles??

  2. Mr Fain continues to think the rank and file should receive the same percentage increase as the CEO. This comparison ought to be against the average increases of the non-union workers. I’m guessing that isn’t anywhere near what the offer was he rejected.

    1. Union or non union, the middle class is disappearing. Corporate greed is a huge problem, and it’s not getting better. The rich get richer, and the poor get poorer. No CEO should make $55 a second, 24/7, when the workers producing the product make as little as $16 an hour and don’t even receive profit sharing. That is immoral.

    1. I agree. They say the companies can’t afford the pay increases. Prove it, and cut the CEO pay to the equivalent percentage that they are offering the workers.

    2. Keith S.

      The big three are losing their shirts on the EV’s. Losing tens of thousands of
      dollars per EV vehicle produced. Even all the government subsidies vpcan not
      make up for this short fall.

      You keep saying $ 16.00 an hour. The UAW workerss make much more than that
      when you add in theirhealth insurance, the outstanding 401 K contributions by the
      company, and so many other paid benefits by the company.

      Thank the UAW for that $ 16.00 hour wage. The union advocated and pushed the
      two tier wage system. NOT the Auto companies.

  3. The automakers should reduce the amount of raise their proposing by 2% for every week it goes on without a ratified contract. Once the uaw sees they are going backwards in what has been proposed maybe they’ll settle.