Subscriber Benefit
As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe Now
General Motors and the United Auto Workers union have reached a tentative contract agreement that could end a six-week-old strike against Detroit automakers, two people briefed on the deal said Monday.
The agreement follows the pattern set with Ford last week and Jeep maker Stellantis over the weekend.
It was reached early Monday in a meeting at the UAW headquarters in Detroit involving union President Shawn Fain, GM CEO Mary Barra and manufacturing chief Gerald Johnson, said the people, who asked not to be identified because they aren’t authorized to speak publicly about the deal. The agreement was reached on Fain’s 55th birthday.
The deals will last four years and eight months and include 25% general pay raises and cost of living adjustments. Combined they bring the wage increase to more than 30% over the life of the contract.
The contract with GM is similar to those reached by the other two automakers, but there are some differences.
GM was the last company to reach a deal and the union added a lucrative factory in Tennessee to the strike list on Saturday to turn up the pressure.
The UAW reached tentative agreement last week with Ford and Stellantis on Saturday, and it wasted no time in hitting GM where it hurts financially.
Nearly 4,000 unionized workers on Saturday walked out of GM’s largest North American plant in Spring Hill, Tennessee, hours after the deal with Stellantis was announced. They joined about 14,000 GM workers already striking at factories in Texas, Michigan and Missouri.
The people briefed on the matter said Barra and Johnson wanted a deal in an effort to get Spring Hill up and running on scheduled Monday morning, plus they’re trying to reopen a large and profitable SUV factory in Arlington, Texas.
President Joe Biden was asked about the deal Monday, as he boarded Air Force One back to the White House. He gave a thumbs-up and said: “I think it’s great.”
Also Monday, 8,200 Stellantis workers in Canada represented by a different union, Unifor, briefly went on strike before reaching a deal that comes with base hourly wage increases of nearly 20% for production workers. General Motors and Ford workers in Canada have already voted to ratify a three-year contract agreement with the company.
Spring Hill, the plant where workers hit picket lines Saturday, produces the engines for vehicles assembled at nine plants as far afield as Mexico, including Silverado and Sierra pickups. It’s a big money maker for GM that could have potentially amplified the company’s financial pain after workers walked off the job last week in Arlington, Texas, where full-size SUVs including the Tahoe and Suburban are produced. Spring Hill also produces the electric Cadillac Lyriq, GMC Acadia and Cadillac crossover SUVs.
Presidents of the Ford union locals voted unanimously in Detroit on Sunday to endorse that tentative contract after UAW President Shawn Fain explained its details, the union tweeted.
As he explained the particulars to the full membership in a later livestream, Fain, along with Chuck Browning, the UAW vice president, said the deal represents a “historical inflection point” for reviving union power in an America where “we were being left behind by an economy that only works for the billionaire class.”
“UAW members at Ford will receive more in straight general wage increases over the next 4-1/2 years than we have over the last 22 years combined,” Browning said.
Fain called the deal “a turning point in the class war that has been raging in this country for the past 40 years.”
The Ford and Stellantis pacts, which would run until April 30, 2028, include 25% in general wage increases for top assembly plant workers, with 11% coming once the deal is ratified.
The Ford agreement revives cost-of-living adjustments that the UAW agreed to suspend in 2009 during the Great Recession.
At Stellantis, workers get cost-of-living pay that would bring raises to a compounded 33%, with top assembly plant workers making more than $42 per hour. Top-scale workers there now make around $31 per hour.
Starting wages for new Stellantis hires will rise 67% including cost-of-living adjustments to over $30 per hour. Temporary workers will get raises of more than 165%, while workers at parts centers will get an immediate 76% increase if the contract is ratified.
Like the Ford agreement, it will take just three years for new workers to get to the top of the assembly pay scale, the union said. Similarly, the union won the right to strike over plant closures.
Bruce Baumhower, president of the local union at a large Stellantis Jeep factory in Toledo, Ohio, that had been on strike since September, said he expected workers to vote to approve the deal because of pay raises including the immediate 11% raise on ratification. “It’s a historic agreement as far as I’m concerned.”
The UAW began targeted strikes against all three automakers on Sept. 15 after its contracts with the companies expired. At the peak, about 46,000 UAW workers were on strike—about one-third of the union’s 146,000 members at all three companies.
Please enable JavaScript to view this content.
Remember this the next time you go to buy a car and you wonder why the price has jumped so much.
So keep worker pay low so you can drive a car that costs less? There really is something disturbing about that.
Ninety-five percent of price increases for motor vehicles are attributable to OTHER than labor costs.
Incorrect Nancy. Labor costs make up approximately 35% of UAW vehicles (before this new contract negotiation). Non UAW labor costs per vehicle average 20%. You have to remember, labor costs are more than a guy standing on the line inserting a bolt. Labor costs include the Union person mopping the floor on a production line (not the bathroom, but the actual assembly area is factored in). There is a reason that most foreign companies have factories in non-union supported states in the Sothern part of the US, cheaper labor costs and no Union organizing pressure in right to work states.
Labor cost per hour on average ( wages and benefits ) for the UAW car companies is much higher now than for the non union plants.
The Big Three will have to pass the cost on to the consumer.
These new UAW contracts could lead to job losses in the near future.
L N. , Keith B. my fear is you’re both mostly correct. Only time will tell.
The news stories have suggested that this contract would add an increase of $800-900 per vehicle.
On a $40-70,000 new vehicle, in the range of 1.25-2%. That’s not nothing, but it’s certainly minor in terms of monthly payment over 4-6 years.