DETROIT — With just over 24 hours until the strike deadline, United Auto Workers President Shawn Fain said Wednesday that the companies’ offers were not enough and the union was preparing to strike.
In an online speech to union members, Fain said General Motors, Ford and Stellantis increased their initial wage offers but rejected some of the union’s other demands.
“We do not yet have offers on the table that reflect the sacrifices and contributions our members have made to these companies,” he said. “To win, we’ll likely have to act. We’re preparing to hit these companies in ways we’ve never seen before.”
The union is threatening to strike after contracts with companies failed to reach an agreement on Thursday at 11:59 p.m. But the strikes would target a small number of factories per company. It would be the first time in the union’s more than 80-year history that it would hit all three companies at the same time.
Negotiations continued with the companies on Wednesday, but it appears the two sides are still far apart.
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Automakers say they must make huge investments to develop and build electric vehicles while continuing to build and design internal combustion vehicles. They say a costly labor agreement could impose costs on them that would force them to raise prices above those of non-union foreign competitors. And they say they made fair proposals to the union.
Interviewed Wednesday evening after an appearance at the Detroit auto show, frustrated Ford CEO Jim Farley said that if the union went on strike at Ford, it was not the company’s fault because it had four offers and had not obtained a “real counter-offer”.
“It’s hard to negotiate a contract when there’s no one to negotiate with,” Farley said, wondering aloud if Fain was too busy planning strikes or events intended to gain publicity.
The company, he said, made a generous salary offer, eliminated salary levels, reinstated cost-of-living salary increases and increased vacation time. The union disputes his claim that the tiers were scrapped.
“It was totally competitive with all the agreements the UAW negotiated, sometimes after strikes, with other industrial companies. And we heard nothing,” Farley said.
But he added there was still time to reach an agreement before the deadline.
Fain said the final decision on which factories to strike won’t be made until Thursday evening and will be announced at 10 p.m. Eastern time.
The union president said it was still possible that all 146,000 UAW members would walk out, but the union would start by striking at a limited number of factories.
“If companies continue to negotiate in bad faith, or continue to stagnate, or continue to make insulting offers to us, then our strike will continue to expand,” Fain said. He said the targeted strikes, with the threat of escalation, “will leave businesses in uncertainty.”
The union will not extend contracts, so those who remain on the job will do so with an expired agreement. Fain said he understands the sentiment behind an all-out strike, which is still possible. But he said the targeted strike strategy was more flexible and effective.
If there is no agreement by the end of Thursday, union officials will not negotiate Friday and will join workers on the picket lines, he said.
The UAW began by demanding a 40 percent raise over the life of a four-year contract, or 46 percent when compounded annually. The companies’ initial offers fell well short of these figures. The UAW later lowered its demand to about 36 percent.
In addition to general wage increases, the union is calling for the reinstatement of cost-of-living wage increases, an end to different wage levels for factory jobs, a 32-hour week with 40 hours of pay, the reinstatement of traditional defined benefit benefits. pensions for new hires who now only benefit from 401(k) retirement plans, pension increases for retirees and other items.
On Wednesday, Fain said companies had increased their salary offers, but he still called them insufficient. Ford offered 20% over 4 years, while GM was at 18% over four years and Stellantis at 17.5%. The increases barely make up for what he described as minimal increases in the past. In a 2019 agreement, the union secured wage increases of 6% over four years, with lump sums in some years as well as profit-sharing checks.
The maximum wage for an assembly plant worker is now $32 an hour.
The three companies’ cost-of-living adjustment offerings were deficient, he said, offering little or no protection against inflation, or annual lump sums that many workers won’t get. not.
Companies have rejected pay raises for retirees who haven’t received one in more than a decade, Fain said, and they are seeking concessions on annual profit-sharing checks, which often exceed 10,000 dollars.
In a statement, Stellantis said it had submitted a third salary and benefits offer to the union and was awaiting a response.
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“Our goal remains to negotiate in good faith to reach a tentative agreement before tomorrow’s deadline,” Tobin Williams, the company’s head of human resources in North America, said in a statement. “The future of our represented employees and their families deserves nothing less.”
GM said in a statement that it continues to negotiate in good faith, making “strong additional offers.” The company reported progress, including guaranteeing annual salary increases and investments, investing in U.S. factories and shortening the number of years employees can earn top salaries.
Farley, Ford’s CEO, said in a statement that his company had made four “increasingly generous” offers since Aug. 29. “We still haven’t received a real counteroffer,” he said.
Farley said Ford increased its wage offer, eliminated salary tiers and reduced the time it would take hourly workers to reach the highest level from eight years to four years, and added more leave.
Thomas Kochan, a professor of labor and employment at the Massachusetts Institute of Technology, said both sides are going to have to make big compromises quickly in order to resolve differences before Thursday’s deadline.
“It will be played out until the end, and there will be no agreement before the last moment, if there is one,” he declared.
The union, he said, knows its initial proposals were not realistic for any of the companies, but the companies know they are going to have to make a very expensive deal, including addressing tiered salaries for people doing the work. same work.
With Fain leading the union, the negotiations were the most public in U.S. history, he said, putting pressure on both sides to reach an agreement.
The union, however, says the companies are extremely profitable and can afford to give big raises because labor makes up only a small percentage of the price of a car. The companies collectively reported $164 billion in net profit over the past decade, including $20 billion this year.