A New Hope: The UAW Victory and Beyond

Image courtesy of UAW.

If there has been a constant theme to Left discourse in the U.S. it has been that a labor revival is always just around the corner. While this has proved to be quite elusive, it can be said that this year has put workers rights squarely in the spotlight. There has been the continuing organizing campaigns at Starbucks and the strikes of the writers and actors unions in Hollywood. The Wall Street Journal recently reported that as of October the number of days lost to work stoppages this year is at a four decade high.

Most prominently however, was the successful United Autoworkers (UAW) strike against the Big Three car companies (Ford, GM, Chrysler). The union, through strategically targeted strikes, achieved a 25 percent raise over the four and a half year contract, including 11 percent for the first year along with a $5000 bonus. The contract also restores an annual cost-of-living increase that was eliminated during the 2008 financial crisis. Just as significant, the new contract eliminates worker tiers and codifies a right to strike over plant closures.

The contract is a shot in the arm for a union that was sorely in need of one. The UAW reached its peak in 1979 with 1.5 million members. Right around that time the U.S. south, with its lower wages and land costs, not to mention anti-union environment, began looming as larger for the industry, especially for emerging companies from Japan and Korea. Nissan opened a plant in Smyrna, Tennessee in 1983, BMW in Spartanburg, South Carolina in 1994, Mercedes-Benz in Vance, Alabama in 1997. Honda moved into Lincoln, Alabama in 2001. By now, 30 percent of automotive jobs are in the south, double the number since 1990. The number of UAW members plunged to 383,000. In recent times the union lost several high profile union votes at the Volkswagen plant in Chattanooga, Tennessee and the Nissan plant in Canton, Mississippi. Yet this contract offers hope for a revival and obvious proof that strikes work. The strike even had a strong effect for nonunion autoworkers as in the aftermath Toyota announced a 9 percent raise. Honda an 11 percent raise, and Hyundai 14 percent (25 percent by 2028).

Of course, the specter of electric vehicles (EVs) hovers over the industry. Recent headlines have fretted about an EV slump in the U.S. Growth has slowed after doubling in each of the last two years. This year’s sales growth has been about 48 percent even with the $7500 tax credit that resulted from the Inflation Reduction Act. When President Biden signed the act into law last year, he set the ambitious goal of making half of all new cars sold in the U.S. fully electric by 2030. Measuring by today’s sales that would mean roughly 7 million EVs a year. About 1 million EVs have been sold this year. Dealerships are reporting a large backlog of EVs in showrooms amid concerns about price and the range of chargers. Sales are still concentrated in only a few states. Overall there are 282 million registered vehicles in the U.S.

At the moment, just about 8 percent of new car sales in the U.S. are EVs. Not much when compared to places like Norway (almost 90 percent), Iceland (41 percent), Sweden (32 percent), or China (25 percent). China has more EVs than the rest of the world combined and, thanks to companies like BYD (BYD is a vertically integrated monster. It started as a battery maker and still makes its own batteries in addition to now making its own semiconductors, now the most profitable parts of cars, and even its own ships to ship cars internationally) has overtaken Japan as the world’s largest car exporter. Ford has actually announced plans to cut planned production of its all electric F-150 Lighting pickup in half next year along with lower production plans for its Mustang Mach-E (in the 3^rd quarter of this year the company reported an operating loss of $1.3 billion for its EV division, translating into a loss of $62,016 for each EV it sold). GM announced in October it will delay production of electric pickup trucks in Michigan’s Orion Township by a year to late 2025 and the rollout of its GMC Hummer EV has been slower than projected. According to the National Automotive Dealers Association, pickups and SUVs make up 80 percent of all new passenger vehicle sales in the U.S. market.

Still the EV market will grow in the U.S. and presents a necessary target for the UAW. Obviously, EVs need batteries. Perhaps the most significant achievement of the UAW contract is GM’s concession to include EV and battery workers in the master agreement. Workers at the Ultium Cell battery plant in Lordstown, voted overwhelming in November to join the agreement. When the plant opened in 2022, workers were paid $16.50 an hour — barely half of what UAW members had been earning at a shuttered GM assembly plant nearby.

Thanks to billons worth of government loans, grants, and tax credits, a building boom is in the works. Ultium Cells is a joint venture between GM and LG Energy Solution, GM originally fought to exempt the plant from the union contract on the basis that the plant was a joint venture and would therefore need its own agreement. The UAW held firm and won.

The joint venture model is being used by other companies as well. Ford created one with South Korea SK called BlueOval SK. BlueOval SK is building two plants in Kentucky and hiring five thousand workers. Ford is also contracting with Chinese battery-maker CATL for a lithium iron phosphate plant in Marshall, Michigan. There should be enough momentum for these plants to be covered by the contract.

There are also plenty of nonunion companies getting into the battery frenzy and much like car production much of it centers in the south: BMW is investing in a battery plant in South Carolina, Hyundai (Georgia), Mercedes-Benz (Alabama), Toyota (North Carolina), Volvo (South Carolina). Not just car companies. Battery makers are obviously building as well. Japanese company AESC (Tennessee, Kentucky, South Carolina), Panasonic (Kansas), South Korea SK Battery America (Georgia).

In the aftermath of the strike, the UAW has announced a major organizing effort. Tesla has to be a main target. Tesla is still by far the largest player making up over half the U.S. EV market. It is currently the most valuable car company in the world and the only major American car company not unionized. It is estimated that Tesla workers earn on average about $55 an hour in wages and benefits, compared to $66 to $71 an hour at Detroit’s Big Three. In addition to Tesla the push targets two other EV startups, Lucid and Rivian, and ten foreign-owned automakers. According to the union, collectively the companies employ 150,000 workers across 13 states.

A union drive against Tesla surely will be an uphill fight. A 2016 organizing attempt apparently ended amid workers getting fired. Ironically, Elon Musk recently proclaimed at an event in New York that he didn’t like the idea of unions “[because] I just don’t like anything which creates a lords and peasants sort of thing.” Yet what is happening now in Sweden clearly reveals a path forward. On October 27^th 130 Tesla mechanics walked off the job over Tesla’s refusal to sign a collective agreement that the union IF Metall has tried negotiating for five years. It wasn’t long before union dockworkers refused to unload Tesla cargo at Swedish ports. Then the Swedish Building Maintenance Workers’ Union joined in and the 50 or so members who clean Tesla showrooms and services centers stopped cleaning. On November 20^th postal workers stopped delivering mail, including license plates (Tesla sued and initially won the right to pick-up plates directly from Sweden’s Transport agency but a court paused that until a final ruling is made). Now it is reported that the Transport Workers’ Union will refuse to pick up waste at the company’s workshops starting December 24th. Even Sweden’s pension funds are applying pressure. All this in a country where Tesla doesn’t even make cars (its ‘Gigafactories’ are in Fremont, Sparks, Buffalo, Austin, Berlin, and Shanghai).

In other words: solidarity. For now Tesla is digging in, no doubt out of fear of the damn bursting everywhere. Yet with solidarity the peasants always have a chance at winning, perhaps even here in the U.S.

The post A New Hope: The UAW Victory and Beyond appeared first on CounterPunch.org.

This content originally appeared on CounterPunch.org and was authored by Joseph Grosso.

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