UAW Reaches Tentative Deal With All Detroit Automakers, Striking Ends

The United Auto Workers have reached a tentative agreement with all three Detroit automakers. Ford was the first to strike a deal, followed by Stellantis. But General Motors wasn’t far behind and managed to settle things with the union early Monday morning. Based on comments from select UAW members in the know, the final issue reportedly revolved around EV battery plants.

The issue came up relatively early in the union’s “stand-up strike” that began on September 15th. By early October, there were concerns that employees working at the automotive sector’s new battery facilities (many of which are jointly operated with foreign suppliers) likewise needed to be covered by labor agreements.

The deal with Stellantis was announced on Saturday and is said to mimic the terms the union already had negotiated with Ford. While we’ve covered the topic, specifics on the deal are still forthcoming and likely won’t be fully known to the public until after it’s been ratified by voting union members. The UAW effectively turned up the pressure on all automakers in recent weeks, targeting their most lucrative facilities for expanding labor strikes.

GM’s last facility to see a walkout was the incredibly important Spring Hill Manufacturing located in Tennessee. The site is responsible for several Cadillac and GMC-branded crossover vehicles. But its most important role is putting together powertrains and body panels for some of the automakers’ highest-volume models. Workers were told to abandon their posts on Saturday, not long after striking wrapped for Stellantis.

It was apparently too much for the company to endure and news broke early on Monday that General Motors (now standing alone against the UAW) had likewise reached a tentative contract agreement with the union. The last hurdle was rumored to be the inclusion of Ultium Cells LLC (a joint venture between GM and South Korea’s LG Energy Solution) in the UAW’s master contract. This would effectively set the stage to make unionization easier at subsequent battery plants.

As with the Stellantis agreement, we’re expecting the union contract with General Motors to be based closely on the deal made with Ford. That includes a 25-percent wage increase over the duration of a contract that won’t expire until 2028, the reinstatement of cost-of-living adjustments that were dumped in 2009, improved profit-sharing with workers, faster employee progression to the top wage tier, and eventual abolishment of tier wage scales over the next four years.

There will also be an immediate pay bump for all unionized employees. For GM, that equates to an 11 percent increase in wages within the first year. That should put the average employee just north of $35 per hour by 2024 and set the stage for that number to reach $45 per hour by 2028.

The union also won improved job guarantees. However, these will vary between automakers. GM seems to be offering ways of transitioning employees over to EV facilities as it gradually abandons combustion vehicles. Though there’s a lot of room to speculate how that will work at this stage.

There will also be investment guarantees that will be made known as more details are shared ahead of the ratification votes. Thus far, we’re only aware of Ford’s plan — which includes $2.1 billion for Ohio Assembly (with some of that going toward electric vans); $1.2 billion for Louisville Assembly (with some slated for new EVs and hybrid models of existing cars); $1 billion in Kansas City Assembly; and $900 million set aside to maintain localized F-Series production.

A UAW national council vote is anticipated for later this week regarding GM, with voting likely to take place beforehand on the other tentative agreements. If approved, the terms will be handed off to local union leaders who will present it to general members that will ultimately decide whether or not the deals are ratified. Ratification bonuses are included in all three deals, encouraging union members to take the deal and net themselves a few thousand dollars instantly.

While striking will undoubtedly resume if any of the above deals fall through, it seems as though union actions are probably over for 2023. UAW President Shawn Fain has been bragging about how the current contract proposals have broken union records and represent a restoration of ground lost over the last few decades. Granted, there is a contingency of union members who seem confident sweeter deals could be negotiated. But they look to be in the minority. Regardless, it’s undoubtedly wiser for all members to wait until they’ve seen the proposals in full before taking any formal stance.

Considering automakers were claiming to be losing hundreds of millions of dollars in lost revenue per week due to strike conditions before the UAW began targeting their most important factories, it’s unlikely they’re interested in seeing any more factory downtime either. That same is true for auto parts suppliers, which have had to endure layoffs and some production stops of their own while things were sorted out with the UAW.

Expect formal announcements to be made by the union and each of the three automakers involved over the coming days.

[Image: UAW]

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