How could the union crisis in Detroit affect the auto industry?

2023-09-08 17:49:39

With less than a week until the strike deadline of September 14 at 11:59 pm EDT, Detroit is serving up more drama than Broadway.

UAW President Shawn Fain turned up the pressure on automakers in a new round of video speeches and social media posts attacking the Detroit Three.

He also attacked the corporate media and analysts who fear a strike might drive up auto prices.

Fain is scheduled to speak once more via Facebook Live at 5 pm EDT on Friday. Stellantis’ latest proposal is expected to arrive later Friday and be thrown into Fain’s trash can.

Fain on Thursday called General Motors’ new contract offer “=insulting and added: “The clock is ticking. Stop wasting our members’ time.

The offers and counteroffers exchanged this week are almost irrelevant. Companies are not going to put their final offers on the table so far in advance of the deadline. The UAW has no reason to accept a proposal now, or even in a week.

Throwing out low-ball proposals now helps the UAW president get ratification for a later, better offer that still doesn’t meet all of the union’s demands.

The UAW’s decision to publicly rebut the automakers’ proposals point by point offers a glimpse of the game at hand.

Automakers offer higher wages and a shorter path to top-tier salaries, but propose steep reductions in profit sharing to offset that cost.

Companies have figures for what they want a deal with the UAW to cost, and they present that figure in different-sized chunks. It’s the same as always.

A strike might be good for both sides, if it doesn’t last too long. In the end, both the UAW leadership and the companies must demonstrate to their respective constituents (union members) that everything was given on the field.

According to new calculations from Cox Automotive, all three Detroit brands, with the exception of Chevrolet, have enough inventory to withstand a two- to four-week dealer strike,

Stellantis dealers have Ram trucks and Jeep SUVs in stock for over 100 days. One might argue that Stellantis needs a strike to avoid a year-end sell-off.

Before 1976, UAW strikes were the norm, not the exception

The UAW’s 40-day strike once morest General Motors in 2019 was the longest strike once morest one of the Detroit Three since 1976. In 2007, the UAW hit GM and the former Chrysler for two days and one day respectively.

And for Canada?

Unifor, the Canadian automobile union, has chosen Ford to establish a contractual template in the negotiation that takes place parallel to the UAW talks. Unifor wants investments in new products.

Could the Canadians win at the expense of the UAW?

Source: By Joseph White, Archyde.com

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