The auto workers' strike against Detroit's Big Three automakers has entered its fourth day, and there are no signs of an immediate resolution. The United Auto Workers (UAW) union has threatened to escalate the labor action if "serious progress" towards an agreement is not made by Friday at noon, according to UAW President Shawn Fain in a video statement on Monday. Fain emphasized that autoworkers have waited long enough for fair treatment and are not willing to wait or "mess around" any longer.
Currently, the strike is limited to about 13,000 workers at three factories - one each at General Motors (GM), Ford Motor, and Stellantis. However, GM has warned that an additional 2,000 UAW-represented workers at an assembly plant in Kansas City are expected to be idled due to a shortage of supplies caused by the strike at a GM plant near St. Louis. The Kansas City plant builds the Chevrolet Malibu and Cadillac XT4. Ford also took action in response to the strike by temporarily laying off 600 non-striking workers at its assembly plant in Wayne, Michigan. This layoff was a consequence of the strike at the Michigan Assembly Plant's final assembly and paint departments, as the components built by these employees require e-coating, which is completed in the paint department currently on strike.
The strike's potential impact on the economy and political landscape has prompted Treasury Secretary Janet Yellen to express hope for a quick resolution. Yellen stated that it is too early to assess the strike's effects and that it largely depends on the duration and the parties affected. Experts have suggested that the strike could lead to an increase in both new and used car prices and result in a loss of $5.6 billion in wages and automaker earnings.
In response to the strike, President Joe Biden plans to send two top administration officials to Detroit to meet with both sides. Acting Labor Secretary Julie Su and senior aide Gene Sperling will not be mediators at the bargaining table but aim to support the negotiations in any constructive way possible. Biden has publicly expressed support for the UAW, stating that the automakers have not fairly shared their record profits with workers.
The UAW has rejected an offer by Stellantis to increase worker wages by 21% over four years. Both Ford and GM have also offered a roughly 20% pay raise, but the union is demanding a 36% hike over a four-year contract. Additionally, the union wants the elimination of the two-tier wage model, the provision of defined benefit pensions to all employees, the limitation of temporary workers, the implementation of a four-day workweek, and more job protections, including the right to strike over plant closings.
Instead of launching an all-out strike, the UAW has strategically targeted three factories to maximize the longevity of its $825 million strike fund. Workers have walked out of a GM plant in Wentzville, Missouri, a Ford plant near Detroit, and a Stellantis factory in Toledo, Ohio, which produces Jeeps. The union's strategy includes the threat of escalating the strike if the pace of bargaining does not meet their expectations. Fain stated that more factories could be targeted in the near future, creating uncertainty and signaling the union's determination to secure a strong agreement.
Harry Katz, the Jack Sheinkman Professor of Collective Bargaining at Cornell University, predicts that the UAW will ultimately reach a compromise and secure a strong agreement. The question remains regarding the specifics of the compromise and the timeline for achieving it.
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