Forty days after the United Auto Workers went on strike against Detroit’s Big Three automakers, the union has reached a tentative agreement with one of the companies in question: Ford. It means deals with General Motors and Stellantis may soon be on the horizon, too.
Emily Stewart covered business and economics for Vox and wrote the newsletter The Big Squeeze, examining the ways ordinary people are being squeezed under capitalism. Before joining Vox, she worked for TheStreet.
On Wednesday, the UAW announced that its negotiators had made a tentative deal with Ford on a new four-year contract for members. In a video, UAW president Shawn Fain and international vice president Chuck Browning laid out some of the details of the agreement and what comes next. “For months we’ve said that record profits mean record contracts. And UAW family, our stand-up strike has delivered,” Fain said in the video.
The “stand-up strike” is the union’s strategy of having different plants and workers go on strike at different times. The idea is to increase leverage and keep the companies guessing about what would be next. The union began striking, starting with three plants across Ford, GM, and Stellantis, on September 15.
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The exact details of the tentative agreement aren’t yet clear. The union said the deal includes a 25 percent increase over the course of the new contract. It raises the top wage for workers by over 30 percent to more than $40 an hour, the starting wage by 68 percent, and the wage for temp workers by over 150 percent. The agreement entails improvements for current retirees, members with pensions, and members with 401(k)s.
Notably, the agreement includes the right to strike over plant closures for the first time. That may give the union leverage as the auto industry shifts to electric vehicles over time, because in general, electric vehicle plants require fewer workers. Autoworkers have been adamant the EV transition be a “just” one. If EV production grows over time, there will likely be some plant closures, so this gives the union a right to react. “That means they can’t keep devastating our communities and closing plants with no consequences,” Browning said in the video.
In a statement, Ford said that it is “pleased” to have reached a tentative agreement with the UAW. “Ford is proud to assemble the most vehicles in America and employ the most hourly autoworkers. We are focused on restarting Kentucky Truck Plant, Michigan Assembly Plant and Chicago Assembly Plant, calling 20,000 Ford employees back to work and shipping our full lineup to our customers again,” the company said.
In the weeks leading up to the tentative agreement, Ford’s leadership had been rather vocal in its frustrations with the strike. On October 16, Ford executive chair Bill Ford called for an end to the strike, calling talks “acrimonious.” Days prior, a Ford executive said the company had “reached our limit” in its offer.
“It really ramps up the pressure on GM and Stellantis”
The UAW council that manages the relationship with Ford will vote on whether to send the agreement to membership on Sunday, October 29, in Michigan. If they approve the agreement, the union will host a Facebook Live that night to go over it with members in detail and release more information to members. Then, it will be up to Ford’s 57,000 UAW members to vote on whether to take the deal.
Striking Ford workers don’t have to wait on the vote to go back to work; they can return immediately.
“It really ramps up the pressure on GM and Stellantis,” Garrett Nelson, vice president and senior equity analyst at CFRA Research, a financial intelligence firm, told Vox in an interview.
Nelson said that the UAW was “very strategic” in how they approached Ford, which has more UAW workers than each GM and Stellantis. “They hit Ford the hardest,” he said. More Ford workers went on strike than at GM and Stellantis. The UAW also targeted Ford’s largest plant earlier on than the others, when on October 11 some 8,700 workers at Ford’s Louisville plant walked off the job.
“It’s a solid and good contract to give us a solid base when the next negotiations come”
The UAW didn’t call strikes at GM’s and Stellantis’s biggest plants until this week, which didn’t make either company happy. Stellantis said it was “outraged” by the move, and GM said it was “disappointed by the escalation of this unnecessary and irresponsible strike.”
“The perception is the union had better relations with Ford than either Stellantis or GM, so it was kind of a mystery why they were hitting Ford harder than the other two companies, but in hindsight, it all makes sense,” Nelson said. “They wanted to reach a deal with Ford first, and Ford was showing greater flexibility in recent weeks in terms of concessions.”
Charles Wade, a strike captain at a Ford plant in Wayne, Michigan, who has been on strike since the UAW first called on some workers to walk off the job, told me he feels good about what he’s seen of the tentative agreement and believes it will pass. “It’s a solid and good contract to give us a solid base when the next negotiations come. Of course you always want more, but there is a balance and this contract is right where everyone gets a piece,” he said. “Can’t wait to read the whole [tentative agreement] to fill in some blanks. This is a good contract, though, by far compared to the last 20 years.”
