UPDATED 2:44 P.M.
DETROIT (Reuters) -Ford Motor Chief Executive Jim Farley on Friday accused United Auto Workers leaders of holding up a new U.S. labor agreement and halting production at several factories due to a dispute over wages and benefits at new electric vehicle battery plants that have yet to start production.
Hours before Farley spoke, UAW President Shawn Fain expanded the first-ever simultaneous strike against the Detroit Three automakers as it entered its third week. He ordered workers to walk off the job at Ford’s Chicago assembly plant and GM’s Lansing, Michigan, assembly plant. He said Stellantis was spared after last-minute concessions by the Chrysler parent.
Farley told a press briefing battery plant negotiations are difficult but added “I don’t think we have reached … an impasse but that day could come.”
Fain’s view of negotiations was very different. “I don’t know why Jim Farley is lying about the state of negotiations,” Fain said in a statement responding to the Ford CEO. “It could be because he failed to show up for bargaining this week, as he has for most of the past ten weeks.”
Fain said differences with Ford include retirement benefits and job guarantees.
The union and the companies remain far apart on key economic issues. Fain has stuck with a demand for 40% pay hikes over a four-year contract, a position supported this week by President Joe Biden. The companies have offered pay hikes of about 20%.
Friday’s strike expansion covered about 7,000 workers, Fain said, bringing the total number on picket lines to 25,000, or about 17% of the union’s 146,000 members at the three automakers.
Rather than the hammer blow of a mass walkout it has wielded historically, the UAW is strategically playing the companies against each other, using reprieves from expansion of work stoppages as encouragement with different automakers the last two weeks.
The expanded strike was still avoiding pickup trucks, Detroit’s biggest profit-makers, a sign of restraint. Workers on Friday walked out of the Ford assembly plant in Chicago that builds the Ford Explorer and Lincoln Aviator SUVs, as well as the GM plant in Lansing that makes the Chevy Traverse and Buick Enclave SUVs.
Farley said the union’s decision to expand walkouts at Ford threatened thousands of supplier jobs. He added many suppliers are “on a knife’s edge” because a more than two-week strike at the Michigan factory that builds Bronco SUVs and Ranger trucks.
Fain and UAW officials are pushing demands that “could have a devastating impact on our business,” Farley said.
Farley said the UAW chief was holding a deal hostage to the fate of electric vehicle battery plants, including three that Ford is building with outside companies and one it has planned to own itself in Marshall, Mich. The UAW wants those workers represented by the union and paid the highest-tier wages.
Ford is now reconsidering the size and scope of the $3.5 billion Marshall battery plant in part because of uncertainty over labor costs, Farley said.
General Motors and Stellantis also blamed the UAW for the failure to reach new contracts.
GM said in an email to employees it still has not received a comprehensive counteroffer to its Sept. 21 proposal. “Calling more strikes is just for the headlines, not real progress,” GM said.
Stellantis, which was spared an additional walkout, said: “We have made progress in our discussions, but gaps remain. We are committed to continue working through these issues in an expeditious manner.”
Fain said that moments before he was due to address members at 10 a.m., Stellantis made significant changes in its proposal. That led to a half-hour delay in his announcement, and spared Stellantis from escalation.
Fain cited progress with Stellantis around cost of living allowance payments, as well as right to strike over product commitments and plant closures. Talks continue at all three companies.
Arthur Wheaton, director of labor studies at Cornell University, said: “What Shawn Fain wanted is a tit for tat: If you’re good for us at the table, we won’t mess with you. If you’re bad with us at the table, we will escalate the strike.”
The UAW has ratcheted up pressure over the past two weeks. Workers went on strike on Sept. 15 at one plant each from GM, Ford and Stellantis. The union escalated on Sept. 22, when workers walked off the job at GM and Stellantis distribution facilities in 20 states nationwide.
Fain is also ordering or threatening strikes at other companies. UAW workers are threatening to walk off the job at heavy truck maker Mack Trucks on Sunday, and at three Detroit casinos. A UAW strike has shut down a plant that builds axles for Mercedes-Benz’s Alabama vehicle factory.
The effect of the walkouts on the automakers has been relatively limited compared to the financial hit that would come from halting assembly lines that build Ford F-series, Chevy Silverados and Ram trucks.
“It shouldn’t affect volumes too much. It’s another warning,” Sam Fiorani, vice president of global vehicle forecasting at AutoForecast Solutions, said of the added plants. “They haven’t hit the meat of the profits.”
(Reporting by David Shepardson and Joseph White, additional reporting by Ben Klayman and Abhirup Roy, Bianca Flowers, Shivansh Tiwary, Abhijith G and Peter HendersonEditing by Nick Zieminski and David Gregorio)
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Updated: 9:18 a.m.
DETROIT (Reuters) -The United Auto Workers will expand their strike of Detroit Three factories and walk off the job at one additional assembly plant at General Motors, Ford and Stellantis, three sources familiar with the matter said Friday.
The plans are fluid and could change at any time, the sources said. The UAW declined comment.
The UAW is expected to continue work stoppages currently under way until a new contract is ratified, a source familiar with the situation said, speaking on condition of anonymity.
The union’s action follows an escalation of the initial strike on Sept. 22, when workers walked off the job at General Motors and Stellantis distribution facilities in 20 states nationwide.
The strike began on Sept. 15, when workers struck at one plant each from GM, Frod and Stellantis. The UAW did not strike at Ford distribution facilities, citing progress in talks with that company.
UAW President Shawn Fain was scheduled for a video address on Friday at 10 a.m. ET (1400 GMT). On Thursday, the union made a counter-proposal to Stellantis. Talks among the UAW and negotiators for the Detroit Three were described as “very active” by one person briefed on the situation.
Headed into Friday, about 18,300 UAW members at the Detroit Three were on strike, or about 12% of the 146,000 union members working at the automakers. Strikers have been getting $500 a week from the UAW’s strike fund.
The union previously shut one assembly plant at each of the Detroit Three, and 38 parts distribution centers at GM and Stellantis.
The effect of these walkouts has been relatively limited compared to the financial hit from halting assembly lines that build Ford F-series, Chevy Silverados and Ram trucks.
Analysts estimate GM, Ford and Stellantis earn as much as $15,000 per vehicle on each of their respective large pickup truck models.
The UAW has taken a new approach with walkouts to turn up pressure on the automakers. Rather than the hammer blow of a mass walkout, the UAW has used strikes like a ratchet, keeping company executives guessing where the next turn would come.
The union launched its first walkouts on Sept. 15, with simultaneous strikes at one assembly plant at each automaker.
The union on Sept. 22 expanded its strikes against GM and Stellantis, but kept its Ford walkout limited to a single plant due to progress in those talks. It is unclear whether Ford will be targeted in the next round of actions.
The union and the companies remain far apart on key economic issues. Fain has stuck with a demand for 40% pay hikes over a four-year contract, a position supported by President Joe Biden during a visit to Detroit on Tuesday. The companies have countered with offers of about 20%.
The UAW also is pushing automakers to eliminate the two-tier wage system, under which new hires can earn far less than veterans.
Shares of Ford and GM were marginally lower in early trading Friday.
(Reporting by David Shepardson and Joseph WhiteEditing by Nick Zieminski)
DETROIT (Reuters) – United Auto Workers union President Shawn Fain is expected to launch walkouts at more Detroit Three auto factories Friday, barring last-minute progress in bargaining that has moved slowly since last week.
UAW members, Wall Street investors, industry executives and the White House are watching to see whether Fain shuts down powertrain factories or plants that assemble the pickup trucks and large SUVs that Ford, General Motors and Stellantis rely on for most of their North American and global profits.
Fain will make a video address on Friday at 10 a.m. ET (1400 GMT). On Thursday, the union made a counter-proposal to Stellantis. Talks among the UAW and negotiators for the Detroit Three were described as “very active” by one person briefed on the situation.
If Fain triggers walkouts at more plants starting at noon (1600 GMT) on Friday, the UAW is expected to continue work stoppages currently under way until a new contract is ratified, a source familiar with the situation said, speaking on condition of anonymity.
Headed into Friday, about 18,300 UAW members at the Detroit Three were on strike, or about 12% of the 146,000 union members working at the automakers. Strikers have been getting $500 a week from the UAW’s strike fund.
The union has shut one assembly plant at each of the Detroit Three, and 38 parts distribution centers at GM and Stellantis.
The effect of these walkouts has been relatively limited compared to the financial hit from halting assembly lines that build Ford F-series, Chevy Silverados and Ram trucks.
Analysts estimate GM, Ford and Stellantis earn as much as $15,000 per vehicle on each of their respective large pickup truck models.
Strikes at Ford’s Kentucky truck plant and GM’s Flint truck factory would mark a significant escalation. Those factories build heavy-duty pickups that are the most profitable vehicles Ford and GM sell. A walkout at Stellantis Ram truck and Jeep SUV factories in Sterling Heights, Michigan, Warren, Michigan, and Detroit would deal a sharp blow to the French-Italian automaker.
The union could also shut down engine and transmission factories, or metal stamping operations, that supply parts to multiple product lines and plants. Such an approach would quickly result in closure of assembly plants because they would lack parts.
After the last expansion of the coordinated strike, Fain threatened more action at Stellantis’ critical parts plants in his hometown of Kokomo, Indiana, where the automaker has four factories that make engines and transmissions used widely across the company’s product line.
The union could continue a more incremental approach, halting work at factories such as GM’s electric vehicle plants in Detroit-Hamtramck and Spring Hill, Tennessee, or Ford’s F-150 Lightning electric pickup plant in Dearborn, Michigan. However, strikes at these plants would have less impact as the models affected are either money-losers or substantially less profitable than the big pickups.
The UAW has taken a new approach with walkouts to turn up pressure on the automakers. Rather than the hammer blow of a mass walkout, the UAW has used strikes like a ratchet, keeping company executives guessing where the next turn would come.
The union launched its first walkouts on Sept. 15, with simultaneous strikes at one assembly plant at each automaker.
The union on Sept. 22 expanded its strikes against GM and Stellantis, but kept its Ford walkout limited to a single plant due to progress in those talks. It is unclear whether Ford will be targeted in the next round of actions.
The union and the companies remain far apart on key economic issues. Fain has stuck with a demand for 40% pay hikes over a four-year contract, a position supported by President Joe Biden during a visit to Detroit on Tuesday. The companies have countered with offers of about 20%.
The UAW also is pushing automakers to eliminate the two-tier wage system, under which new hires can earn far less than veterans.
(Reporting by David Shepardson and Joseph White; Editing by Nick Zieminski)
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