Auto workers’ strike to spoil Detroit Auto Show party?

The clock is ticking for the three big American car groups to reach an agreement with the Union of Auto Workers (UAW). Without a deal on new wages and other demands, the union threatens to strike on Friday, the 15th of 2023. It would dim the spotlights of the Detroit Auto Show, which opened doors on Wednesday.

President of the UAW Shawn Fain spoke combatively: “We are preparing to go on strike in an unprecedented way.” He refers to taking action and ceasing duties as of tomorrow at noon if no solution has been reached today. Fain added that proposals from Stellantis, Ford, and General Motors contained better wages but were insufficient over other unmet demands.

‘There’s no one to negotiate with’

On the first day of the Detroit Auto Show, CEO of Ford Jim Farley showed frustration, pointing to the fact that his company had already brought four offers to the table but didn’t receive a genuine counteroffer in return. “It’s hard to negotiate a contract when there’s no one to negotiate with,” he told the press but added he expected that the time left would suffice to settle the new four-year contract.

The big three automakers in the US argue that the investment in electrification makes them cautious about excessive labor costs. But as the Detroit automakers published record profits, they are meeting strong opposition from the 146 000 members Fain represents, the biggest of its kind in the US.

There’s also a general revival of union power marching through the country as it surfaced that new economy models benefit from worker’s underrepresentation. Never since the early eighties have the unions been so popular.

A 46% raise

The UAW feels confident. It demands a 46% rise in wage over four years – it says this aligns with what some executives earned – a 32-hour week or four days, and security measures in the wake of the manufacturing switch to electric vehicles.

The Detroit automakers have met the demands with significant raises, more holidays, and a favorable pension scheme. Fain acknowledged that the ambitions of UAW are steep but “justified”.

If no settlement is reached, the union will rally near the Auto Show tomorrow to stain the glamour and glitter typical for these events. Ex-president Donald Trump supported the union and claimed that it must “make the complete and total repeal of Joe Biden’s insane electric vehicle mandate their primary and non-negotiable demand in any strike.”

If a strike follows, its impact will depend on the duration. The three carmakers might face supply contract issues and claims for delays in vehicle orders.

Only one new model

Whether the tense negotiations have anything to do with it remains uncertain. Still, while a majority of automakers decided to skip the NAIAS (VW, Audi, Mazda, Jaguar, Land Rover, Kia, Hyundai, Genesis, BMW, Mercedes-Benz, Nissan, Porsche, Volvo, Subaru, Lexus, Polestar and Lucid), only one new model was presented during the show’s opening: General Motors unveiled a completely redesigned 2024 GMC Acadia.

The General also showed a refreshed version of the Cadillac CT5, while Ford did the same with the F-150 but kept a low stance for the rest of its portfolio.

At Stellantis, the hottest news came from a hardly visible facelift for the Jeep Gladiator, adopting some new styling cues and features from the recently updated Wrangler. More importantly, Jeep announced that it would withdraw this model from the European market by the end of the year.

So, with a possible strike, the UAW wouldn’t exactly disturb an event on which the whole world is feasting its eyes. But at least it would have a clear shot at the other end of the negotiation table, as the Detroit three are the main protagonists at NAIAS 2023.