When local time in the United States comes to an end on September 14, which is noon on Friday Beijing time, the labor agreement between the United Auto Workers (UAW) and the three major automakers General Motors, Ford, and Stellantis will officially expire. The war of words will enter the moment when it really starts to impact the economy and supply chains.
If this strike really comes as scheduled, this will also beThe first strike in U.S. history targeting three major automakers simultaneously. The last strike in the U.S. auto industry occurred in 2019, when General Motors workers went on a 40-day strike, which was expected to cause GM losses of $3.6 billion. At the same time, Michigan also experienced a single-quarter economic recession.
What is the UAW preparing to do?
In a video released on Wednesday evening local time, the UAW announced that it would name the strike a “Stand Up Strike,” echoing the “sit-down strike” that occurred at the General Motors Flint plant between 1936 and 1937. ” not only established the historical status of the UAW, but also a historic moment for the American labor movement.
Of course, the strikes that begin this week will not be so violent at first. UAW President Fein said,The scale of this strike will be kept small at first, and then gradually expand. During the entire process, more and more factories will “stand up” and enter the strike state..The focus of this strategy isKeeping automakers guessing which factory will go on strike next?。
Fein also emphasized,The UAW’s goal is not the strike itself, but to use it as leverage in contract negotiations.. However, if it must fight for its rights through strikes, the UAW is not afraid to bring the three major U.S. automakers to a standstill.
(Source: UAW)
As of press time, Fein had not announced the first batch of factories to go on strike at Thursday’s event, but said he would wait until later Thursday local time to disclose the information after confirming that an agreement could not be reached.
In the latest update on the progress of negotiations, Fein revealed that labor and management are still in a state of complete disagreement. The salary increase proposed by the three major car manufacturers is almost half of the UAW’s request. At the same time, the union also requires shortening working hours and limiting the number of “temporary workers” hired by the factory.
Ford CEO Jim Farley responded on Wednesday that he and company Executive Chairman William Ford Jr. made the UAW “the most generous offer in history” this week. According to the UAW on Wednesday, Ford has increased the salary increase from the initial 9% to 20% in its latest offer, while GM has increased it from 10% to 18%.
According to the latest news,General Motors said in a letter to employees on Thursday that it had increased the salary increase offer to 20%.and add benefits such as inflation protection.
(Source: Social Media)
What impact will it have on the U.S. economy?
Considering the UAW’s “guerrilla” strike, it is indeed difficult to measure the impact.
IHS analysts had expected that in the event of a massive strike,GM and Ford will lose production capacity of 55,000 and 65,000 vehicles per week. Of course, that’s not what’s going to happen on Friday.
Goldman Sachs also previously analyzed that,U.S. factory strikes could cost GM and Ford $2.5 billion and $3 billion in weekly revenueas a comparison, fully accepting the UAW’s salary increase request will increase GM’s costs by US$4-5 billion in the next four years, while Ford’s estimates are US$5-6 billion.
Of course, the UAW also has economic accounts to settle. During the strike, the UAW will give striking workers $500 a week. Not only is the money significantly less than autoworker wages, but there is also a limit to how long it can last. The UAW’s strike fund currently stands at $825 million,Probably enough to support an 11-week general strikebut considering the medical expenses, the actual time will be shorter.
According to statistics, the three major car companies account for approximately 40% of the U.S. auto market. If the strike lasts long enough, causing shortages at car dealers could affect prices and inflation in the United States. However, foreign car companies such as Toyota, Volkswagen, and Mercedes-Benz, as well as new electric vehicle forces such as Tesla, do not have labor unions, so the full impact of the “U.S. auto industry strike” will be limited to the three major car companies.
According to forecasts from industry research firm Motor Intelligence,At the end of August, Stellantis’ inventory can sustain sales for approximately 74 days, while Ford and GM can also sustain 64 and 50 days of sales.
In addition, the three major car manufacturers operate more than 40 factories in the United States.A full-scale strike would also affect thousands of parts suppliers and hundreds of thousands of workers.these shocks will eventually be reflected in the economy.
(Source of article: Financial Associated Press)
Source of article: Financial Associated Press
Original title: Echoing 1937! What will happen next as the historic strike in the U.S. auto industry enters its final countdown?
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2023-09-14 20:38:56
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