UAW Lowers Raise Demands From 40% to 36% but Auto Worker Strike Likely to Start This Friday

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The United Auto Workers has lowered their pay increase demand to 36% from 40%. Ford, GM and Stellantis (Fiat-Chrysler) don’t think much of the offer, according to people familiar with the offer. The Big Three US automakers have proposed about 10-15% over five years. If there is no agreement then a strike will start this Friday.

The Union is dissatisfied from the last strike in 2019. They were on strike for 40 days and only got two 3% raises and a reduction in plant shutdowns. GM and Ford had $20 billion and $23 billion in gorss profit in 2022 and Stellantis made about $18 billion. Net income is less at about $9 billion in 2022 for GM.

The UAW made its first movement off its 40% raise request. They are asking series of increases over nearly five years that would start with an 18% boost and then alternate between 5% and 4% annually over the subsequent years of the contract. The companies still see the demand as boosting labor costs so high that it would threaten their viability, according to the source.

The automakers and the union still remain far apart on several issues, including the UAW’s request for a restoration of cost-of-living adjustments. The union also is asking for a 32-hour work week, resumption of traditional pensions, restoration of retiree health care and a boost in pension payments.

GM, Ford and Stellantis use about 20-30 hours of labor for each car. The current wages are about $65 per hour. This would be about $1300 to 2000 per car in salary expense. A 20% increase would be about $260-400 per car and 30% increase would be $390 to 600 per car.

5 thoughts on “UAW Lowers Raise Demands From 40% to 36% but Auto Worker Strike Likely to Start This Friday”

  1. The only reason this form of extortion was ever allowed was that FDR thought it was a good way to get money to buy votes. It is monopoly of labor and extortion and is incompatible with the market system. The big union auto companies would already have gone under if it was not for bale outs and handouts. Unions kill companies. We used to be a mining powerhouse. Now we only lead the world in Fuller’s Earth. That is kitty litter. Some people count oil as “mining”. But I don’t see any miners. I see oilmen. And the oil is pumped out of the ground, not dug out. You would not call a water well a mine.
    China leads the world in mining just about everything. Just a few odds and ends in Third World countries.
    FDR also killed gold mining in the US. He made owning gold illegal, and took all the gold coins, melted them down and put them in Fort Knox and other depositories. Nixon gave all that gold away, to France, and Switzerland. The US has no gold, except what is privately held. The demand for gold mining disappeared, and all those gold mines closed when FDR outlawed gold. There are plenty of mines that still have quality ore. But If you opened a mine, a union would be right there to extort everything.

  2. Bernie Sanders crunches the numbers differently in The Guardian: https://www.theguardian.com/commentisfree/2023/sep/12/bernie-sanders-support-united-auto-workers-strike
    He also points out that the average worker is making less than he (usually a “he”) was 50 years ago, adjusted for inflation and that CEOs are now making 400X the average worker.

    Also, “In the first half of 2023 the big three automakers made a combined $21bn in profits – up 80% from the same time period last year. Over the past decade, these same companies made some $250bn in profits in North America alone. Yet last year, the big three spent $9bn – not to improve the lives of their workers, not to make their factories safer, but on stock buybacks and dividends to make their wealthy executives and stockholders even richer.”

    So when those same CEOs say they can’t afford to pay laborers more, you have to look where the profits are currently going.

    The UAW recognizes that fewer line workers will be needed in the shift to electric cars, which generally use 70% fewer parts. This simplification also means that relatively less skilled Mexican workers can assemble the Big 3’s electric entries in Mexico, for cheaper wages that Americans can’t/won’t accept (“can’t,” because our cost of living is so much higher here). That’s why they want guarantees against plant closures.
    A starting line worker makes as little as $17/hour. I’m not sure where the $65/hour comes from, unless one is including benefits and pension contributions that don’t even exist for newer workers. It’s not unreasonable for some of that to be put back.
    A factory worker used to be able to support his (usually a “his”) family on a single salary. Now, it takes two incomes and economists slipped “household income” into the stats instead of “personal income” which has a very different meaning and result – such as the lower birth rates Brian Wang keeps moaning about. I don’t agree that is such a problem, but if he really believes this, than looking to return household income to something like a single wage earner, or at least a spouse working part time and still having time for the kids after school (which ends at 3, not 5) might be a good start. And childcare is a high expense keeping many potential parents in their prime child bearing 20s from having kids. It all ties together…

  3. I’ve heard from a former UAW worker that they would literally throw wrenches into the machinery to create work stoppages.

    Reward good people and kick out the bums. You don’t need unions

  4. The money is inflating so quickly people can’t even figure what they would need to make to stay level.

    Is a high school dropout UAW 32-hour week employee that applies seam sealer to sheet metal joints worth $100,000 in 2023? Maybe. Hasn’t everyone’s salary doubled since 2011? Mine did.

    I’ll never buy a $70k F150, that’s for sure. What are these consumers making that they can afford that?!?

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