The United Auto Workers (UAW) union has expanded its strike against major carmakers by walking out of 38 General Motors and Stellantis parts-distribution centers in 20 states. However, Ford has been spared additional strikes as it has met some of the union's demands during negotiations. UAW President Shawn Fain stated that while progress has been made at Ford, serious issues still need to be worked through. On the other hand, GM and Stellantis have rejected the union's proposals for cost-of-living increases, profit sharing, and job security.
Instead of targeting production plants, the UAW has chosen to go after centers that distribute parts to car dealer service departments. This could potentially drag consumers into the middle of the fight if dealers run short of parts. The new walkouts will affect an additional 5,600 workers, adding to the nearly 13,000 who began strikes last week at three Ford, GM, and Stellantis assembly plants.
The UAW has opted to avoid targeting plants that manufacture popular vehicles such as the Ford F-150 and Stellantis' Ram pickups. The union's strategy is to gradually increase the impact of the strike on the automakers. However, the industry's integrated supply chain means that even hitting lower-profile plants cuts into production.
Analysts estimate that GM, Ford, and Stellantis have lost production of over 16,000 vehicles since the strike began. The economic losses for the three automakers are estimated to be over $1.6 billion. As a result, the carmakers and some of their suppliers have laid off around 6,000 workers.
While the impact on car lots around the country is not yet being felt, analysts predict that it may take a few weeks before there is a significant shortage of new vehicles. However, prices could rise sooner if the prospect of a prolonged strike triggers panic buying.
In bargaining, the UAW is seeking wage increases of about 36% over four years, pointing to the carmakers' recent profits. The companies have offered a little over half that amount. The UAW also has other demands, such as a 32-hour work week for 40 hours of pay and the restoration of traditional pension plans for newer workers. The companies argue that they cannot afford to meet these demands due to the need to invest profits in transitioning to electric vehicles.
The UAW has been negotiating simultaneously with all three Detroit giants instead of bargaining with one company and setting a pattern for contracts at the others. By targeting parts-distribution centers, the UAW aims to inflict quick pain on GM and Stellantis. However, this move carries strategic and risky implications.
The strikes currently involve just over 10% of the UAW's members, allowing the union's strike fund to last longer as most members continue working under the expired contract and pay into the fund. However, the longer the strike lasts, the greater the risk of dissension between workers who receive full paychecks and those receiving $500 a week from the union. Despite this, Fain believes that most of the public supports the union and has invited anyone, including the president of the United States, to join the strikers on the picket lines.