Beware the Wrong Auto Deal

[Celerity]

Today on TAP: An agreement with generous raises that allowed for a low-wage, non-union EV sector would be far worse than a strike.

https://prospect.org/blogs-and-newsletters/tap/2023-09-13-beware-wrong-auto-deal/



The White House is expressing great confidence, for public consumption, that the UAW strike threatened against the Big Three automakers for midnight tomorrow will not occur. “I’m not worried about a strike,” the president said as he arrived in Philadelphia for a Labor Day speech. “I don’t think it’s going to happen.” His press aides and top officials have been telling reporters the same thing. But the president is whistling past the graveyard. Whether a strike occurs depends heavily on what the White House does behind the scenes in the next 24 hours. And there are ways that even an averted strike could backfire on both Biden and the UAW.

Against a background of record industry profits, the auto union is making two different sets of demands. First, they want a large raise, of over 40 percent over the life of the four-year contract. (This is the same percentage raise that the Big Three’s chief executives have received over the previous four years.) They also want a commitment that the electric-vehicle sector, the future of the industry, must be union and covered by the Big Three’s existing master agreements—including battery suppliers and joint ventures between the Big Three and other battery companies.

The automakers initially proposed raises in the range of 9 to 14 percent, plus a one-time bonus. As of Monday, the two sides were somewhat closer on wages, but had made no progress on the EV transition. “The federal government is pouring billions into the electric vehicle transition, with no strings attached and no commitment to workers,” the UAW’s new militant president Shawn Fain wrote to his members on May 2. “The EV transition is at serious risk of becoming a race to the bottom.” Fain is threatening to withhold the union’s endorsement of Biden’s re-election unless the administration uses its leverage to back a just transition to electric vehicles for workers.

According to my sources, the industry strategy is to make the bargaining entirely about wages and working conditions, offer the autoworkers a very generous raise of more than 30 percent, but concede nothing when it comes to the EV sector, and hope that the union takes the deal. That would be a disaster. It would represent the union being bought off for present workers at the expense of an increasingly non-union auto future. Too much of the decline of organized labor over the past several decades has followed exactly this pattern. The industry hope is to put Fain in a bind, since such a deal might look very good to the rank and file. It would take gumption and leadership for Fain to reject the deal and tell the industry to come back with a bargain that included EVs.

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