DETROIT (AP) — General Motors and Jeep maker Stellantis are meeting with negotiators for the United Auto Workers union to see if they can reach a contract agreement that mirrors the one signed with rival Ford.
Nearly 17,000 striking Ford workers left the picket lines when the deal was announced Wednesday night and will return to work soon. About 57,000 Ford workers have not yet voted on the initial deal.
GM and Stellantis will have to follow the pattern set by Ford or UAW President Sean Fine will likely add plants to their partial strikes that began Sept. 15, said Art Wheaton, director of labor studies at Cornell University.
“It doesn’t seem to me that Finn is willing to give up anything to the other two automakers to break this pattern,” Wheaton said.
Wheaton said additional strikes would be painful for companies, especially General Motors, which has pickup truck plants in Fort Wayne, Indiana, and Flint, Michigan, that the union may close.
Wheaton said GM and Stellantis are losing money because of the strikes and may be eager to end them, although it is unclear whether Ford workers will ratify the contract. GM said Tuesday it was losing about $200 million a week due to the strike that affected this week the highly profitable plant in Arlington, Texas, that produces large SUVs like the Chevrolet Tahoe.
Ford’s deal, if approved by local union leaders and ratified by members, would give workers at the large-scale assembly plant a 25% raise over the life of the contract. Including cost of living increases, workers will receive more than 30% pay increases, beyond $40 per hour when the contract expires on April 30, 2028. They will also receive pay increases and a faster path to temporary full-time employment. workers, increases in pensions and 401(k) contributions for those who don’t have. Members may begin voting next week on the deal.
GM will likely be the next company to reach an agreement because it has agreed to include new electric vehicle battery factories in the UAW’s national contract, essentially consolidating them. The UAW sees these plants as the jobs of the future in the auto industry as the country and the world transition from internal combustion engines to battery power. Workers who make gasoline engines and transmissions will need a place to work when their factories are eliminated.
It was not clear what Ford had committed to regarding battery factories. The company said it would be difficult to unionize employees who have not yet been hired at the plants that have not been built. Ford had announced plans to build two battery factories in Kentucky, one in Tennessee and one in Michigan, but the Michigan factory is now on hold.
The three companies said they did not want to incur labor costs that were so high that it would force them to raise prices and make their cars more expensive than those made by non-union companies such as Tesla and Toyota.
On Thursday’s third-quarter earnings call, John Lawler, Ford’s chief financial officer, said the strike reduced pre-tax earnings by $100 million for the quarter. He said the six-week strike cost the company the production of 80,000 cars, which would reduce full-year pre-tax profits by $1.3 billion. The UAW deal will add between $850 and $900 to labor costs per vehicle, he said. The company is planning cuts and efficiency measures, so it’s unclear how much of this cost will be passed on to consumers.
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