What the U.S auto workers strike means for Canadian industry
The United Auto Workers union is stepping up pressure on Detroit’s Big Three by threatening to expand its strike unless it sees major progress in contract negotiations by Friday.
In a video statement late Monday, UAW President Shawn Fain said workers at more factories will join those who are now in the fifth day of a strike at three plants.
“We're not going to keep waiting around forever while they drag this out ... and we’re not messing around," Fain said in announcing the noon Eastern time Friday deadline for escalating the strike unless there is “serious progress” in the talks. The union plans to disclose the locations of new strikes during an online presentation to members Friday morning.
Ford, General Motors and Stellantis said they want to settle the strike, and they held back from directly criticizing the escalation threat.
Mark Stewart, the North American chief operating officer of Stellantis, the successor to Fiat Chrysler, said the company is still looking for common ground with the UAW.
“I hope that we’re able to do that by Friday,” Stewart said on CNBC.
GM said in a statement, “We’re continuing to bargain in good faith with the union to reach an agreement as quickly as possible for the benefit of our team members, customers, suppliers and communities across the U.S."
A Ford spokeswoman said Tuesday that negotiations were continuing, but provided no additional details.
In Washington, the Biden administration reversed a plan to send acting Labour Secretary Julie Su and senior adviser Gene Sperling to Detroit this week to meet with both sides, according to a White House official. Last week, President Joe Biden publicly backed the UAW and said the officials could play a positive role.
The White House now believes that since negotiations are taking place, “it is most productive for Sperling and Su to continue their discussions from Washington and allow talks to move forward,” said the official, who spoke on condition of anonymity to discuss the private plans.
Fain had discounted the need for help from Washington, saying “This battle is not about the president,” and some Democrats opposed the White House involvement.
“I do not believe that the president himself should intervene as he did in the railroad strike in these talks. He should not be at that table,” said Rep. Debbie Dingell, whose congressional district includes part of southeast Michigan.
So far the strike is limited to about 13,000 workers at a Ford assembly plant in Wayne, Michigan, a GM factory in Wentzville, Missouri, and a Stellantis plant in Toledo, Ohio.
However, layoffs are starting to occur at other locations as the strike crimps the industry's supply chain.
In Toledo, 12 different shops that supply the Jeep plant where UAW is striking have laid off more than 1,600 workers, according to Bruce Baumhower, president of the union local in northeast Ohio. More than half will get state unemployment benefits, while workers at two companies located inside the Jeep plant have been approved for payments from the union strike fund, “but they can't picket because they're not on strike,” he said.
GM warned Monday that the strike in Wentzville, near St. Louis, could force the company to idle an assembly plant in Kansas City early this week. On Tuesday, the company said that it expected to keep production going in Kansas City for at least one more day.
The automakers normally provide supplemental or partial pay to workers who are idled because of supply chain problems, but Ford and GM have said they will not do that this time because the shutdowns are caused by a strike. The union argues that layoffs are a choice by management, but the union’s ability to challenge the change in policy is unclear.
United States Steel Corp. said it was temporarily idling one of its blast furnaces in Granite City, Illinois, an indication that the company expects the strike to reduce demand for steel. There are about 1,450 workers at the site — most of them represented by the United Steelworkers, but the company said many workers won't be affected by the furnace shutdown.
The area’s congresswoman, Democrat Nikki Budzinski, said U.S. Steel was using the strike as an excuse to idle the furnace. “Their effort to blame this announcement on the United Auto Workers strike is a shameful attempt to pit working people against one another,” she said.
A parts supplier, CIE Newcor, told Michigan officials that it expects a one-month closure of four plants in the state to start Oct. 2 and idle nearly 300 workers.
Jose Munoz, president and chief operating officer of South Korean car maker Hyundai Motor Corp., told reporters Tuesday in Atlanta that auto-parts makers would be disrupted by a long strike. Those problems could hurt production at nonunion automakers, not just the Big Three, he said.
“The way the supply chain works today, everything is interconnected,” Munoz said. “It is very difficult to have one supplier that is working only with one (auto manufacturer). So in a way or another, we will see disruptions in the supply chain which may impact companies over time.”
Strikes could spread north of the border. Unifor, the union that represents Canadian autoworkers, extended talks with Ford Motor Co. by 24 hours early Tuesday after receiving a “substantive offer” on a new labour contract just as the current agreement expired.
The UAW is seeking wage increases of more than 30 per cent over four years and other sweeteners. The union says workers deserve a bigger share of record profits that the companies posted as prices rose sharply on strong consumer demand and a limited supply of vehicles because of chip shortages and other issues.
The companies say they can't afford to meet the UAW's demands because they must invest those profits to help them make the transition to electric vehicles.
Associated Press writers Seung Min Kim in Washington, Jeff Amy in Atlanta and Joey Cappelletti in Lansing, Michigan, contributed to this report.