With less than a week to go before an 11:59 PM EDT Sept. 14 strike deadline, Detroit is staging more drama than Broadway.
UAW President Shawn Fain ramped up pressure on the automakers in a fresh round of video addresses and posts on social media attacking the Detroit Three. He also threw a punch at the “corporate media” and analysts fretting that a strike could jack up car prices.
Fain is scheduled to speak again via Facebook Live at 5 PM EDT Friday. Stellantis’ latest proposal is expected to arrive later Friday and get tossed in Fain’s trash can.
Fain on Thursday called a new contract offer from General Motors “insulting” and added: “The clock is ticking. Stop wasting our members’ time. Tick tock.” Arnold Schwarzenegger couldn’t have said it better.
Here’s what to watch next week:
- The offers and counter-offers exchanged this week are close to irrelevant. The companies are not going to put their final offers on the table this far ahead of the deadline. The UAW has no reason to embrace a proposal now – or even a week from now. Trashing low-ball proposals now helps the UAW president win ratification for a later, better offer that still does not meet all the union’s demands.
- The UAW’s decision to rebut the automakers’ proposals point by point in public offers insight to the game underway. The automakers are offering higher pay and a shorter path to top tier wages – but proposing sharp reductions to profit sharing to offset that cost. The companies have numbers for what they want a UAW deal to cost and are presenting that number in different sized slices. Same as it ever was.
- A strike could be good for both sides – if it doesn’t last too long. In the end, both the UAW leadership and the companies need to show their respective constituencies (union members, Wall Street) that everything was given on the field.
- The Detroit Three brands – with the notable exception of Chevrolet – have enough inventory to carry dealers through a two to four-week strike, according to new calculations by Cox Automotive. Stellantis dealers have more than 100 days’ worth of Ram trucks and Jeep SUVs in stock. You could argue that Stellantis needs a strike to avoid a year-end fire sale.
- Before 1976, UAW walkouts were the norm, not the exception. (See this presentation by Chicago Fed advisor Kristin Dziczek.) The UAW’s 40-day strike against General Motors in 2019 was the longest walkout against one of the Detroit Three since 1976. In 2007, the UAW struck GM and the former Chrysler for two days and one day respectively.
- Watch Canada. Unifor, the Canadian auto union, has picked Ford to set a contract pattern in bargaining underway in parallel with the UAW talks. Unifor wants new product investments. Could the Canadians win at the UAW’s expense?
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