Time is running out to avert UAW autoworkers’ strike as deadline looms

Detroit’s big automakers are running out of time to avert a strike as contract talks with the United Auto Workers remain tense, just one week before the current contract expires.

The union has made the most progress in negotiations with Ford but has said it remains unsatisfied with the company’s proposals. General Motors said Thursday that it submitted a new offer to the union that includes a 10% wage increase for most employees and a 20% increase, to $20 an hour, for temporary workers, but the UAW immediately called the proposal “insulting.” Stellantis, the parent company of Jeep and Chrysler, says it will submit a new offer by the end of the week.

Michigan Gov. Gretchen Whitmer (D) said Thursday that she is speaking with the Big Three automakers and the union in an effort to head off a strike, telling Bloomberg that she is “concerned about where it’s headed.” The White House is also involved, having assigned longtime Democratic adviser Gene Sperling as its liaison to the union and automakers.

A strike against one or all of the Big Three would destabilize an industry that contributes about 3% of the nation’s gross domestic product and deliver a blow to the economies of automaking states in the Midwest and beyond.

In a sign of the union’s particular animosity toward Stellantis, the UAW said Thursday that it will hold a protest rally Thursday at the company’s engine plant in Trenton, Michigan.

In the event of a strike, the union would pay workers $500 a week out of the UAW’s $825 million strike fund. To make that money last longer, the UAW could decide to strike only against one or more engine plants, which would cripple overall production without requiring every factory to be shut down, Ambrose Conroy, an auto expert and founder of Seraph Consulting, said in an interview.

The union and its fiery new president, Shawn Fain, have made big demands, including a 40% pay raise over four years and the restoration of benefits that workers gave up around the time of the Great Recession. The automakers have said they can’t give the workers everything they want and still remain competitive against non-unionized automakers such as Tesla.

GM said the 10% wage increase it is offering most of its UAW workers over the life of the contract would be the largest increase since 1999 and 67% higher than the last wage hike in the 2019 contract.

Workers would also get two lump-sum payments equal to 3% of their wages and a $6,000 one-time “inflation-recognition payment.” The company would also give workers a $5,500 bonus for ratifying the contract.

“Our offer includes well-deserved wage improvements that far exceed the 2019 agreement and reward you for your hard work. We still have work to do, but we wanted to make this offer to show our good faith efforts to keep the process moving,” GM said in a letter to employees Thursday.

Last week, the UAW filed complaints with the National Labor Relations Board against GM and Stellantis, accusing the companies of refusing to bargain in good faith. The companies denied the charges.

On Thursday, Fain dismissed GM’s offer.

“After refusing to bargain in good faith for the past six weeks, only after having federal labor board charges filed against them, GM has come to the table with an insulting proposal that doesn’t come close to an equitable agreement for America’s autoworkers,” Fain said in a statement. “The clock is ticking. Stop wasting our members’ time. Tick tock.”

Talks with Ford are at a more advanced stage. The company submitted its offer to the UAW last week, including a 9% wage increase over the four-year contract and a lump-sum payment equaling 6% of wages. It would also pay $12,000 in “cost-of-living adjustment bonuses” over the life of the contract, and would allow employees to reach the top wage level at a faster pace than in the past. And like GM, Ford would give temporary workers a 20% raise to $20 an hour. The status of temp workers has been a sticking point in the negotiations.

“Overall, this offer is significantly better than what we estimate workers earn at Tesla and foreign automakers operating in the U.S.,” Ford Chief Executive Jim Farley said in a statement last week.

Last week, Fain rejected the offer, but the UAW president has become more personally involved in talks with Ford in an effort to reach a deal, according to a person familiar with the negotiations. On Wednesday the union submitted a counter offer to Ford, the person said.

Stellantis this week said its offer would arrive by the end of the week. “We look forward to continuing our discussions to reach an agreement that better positions the business to meet the challenges of the U.S. marketplace and secures the future for all of our employees, their families and our company,” Stellantis said.