The United Auto Workers union expanded its strike to a giant General Motors SUV factory in Arlington, Tex., just after the company told investors Tuesday morning that the nearly six-week-long work stoppage was costing it $200 million a week.
The union said 5,000 workers walked out of the plant that makes the company’s profitable Chevy Tahoe, Chevy Suburban, GMC Yukon and Cadillac Escalade SUVs. The news came a day after 6,800 UAW members began striking against a large Stellantis factory in Michigan that produces Ram pickup trucks.
About 30 percent of the union’s 150,000 workers at Detroit’s Big Three automakers are on strike for better pay and benefits amid contract negotiations.
About an hour before the UAW announcement, GM reported that its net income in the third quarter fell by about 7 percent from a year earlier, to $3.1 billion. The strike, which began Sept. 15, contributed to the drop and has cost the company about $800 million so far, GM executives said.
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GM also cautioned that consumer demand for electric vehicles was slowing, and said it was scrapping its target to build 400,000 EVs by the middle of next year. The company will not announce new targets, and will keep its manufacturing flexible to produce gas-powered or electric vehicles depending on demand, executives said.
UAW President Shawn Fain said the union was hitting the Texas factory because GM’s latest contract offer “fails to reward UAW members for the profits they’ve generated.”
GM, like Ford and Stellantis, is offering full-time workers a 23 percent wage increase over a 4½-year contract. GM Chief Executive Mary Barra said that would put the majority of the company’s UAW workers at $40.39 an hour, or about $84,000 a year, by the end of the contract. Workers also receive profit-sharing bonuses on top of hourly wages.
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“It’s an offer that rewards our team members but does not put our company and their jobs at risk,” Barra said Tuesday. “Jeopardizing our future is something I will not do.”
Share this articleShareBut Fain said GM’s offer lags behind Ford on other matters, including 401(k) contributions and cost-of-living adjustments to wages.
GM is offering to boost its 401(k) contributions to 8 percent of an employee’s wages, plus an additional $1.25 per hour worked to help fund health care in retirement. Ford and Stellantis are offering to contribute 9.5 percent of wages to 401(k) accounts, plus $1 per hour worked to fund retirement health care.
“It is clear that GM can afford a record contract and do more to repair the harm done by years of falling real wages and declining standards across the Big Three,” Fain said in a statement.
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The strike is continuing to hit workers beyond those on the picket lines, with the Big Three temporarily laying off thousands of nonstriking workers whose factories depend on striking plants. Suppliers to the auto industry have also put thousands of workers on temporary layoff.
Two years ago, GM pledged to stop making gasoline-powered vehicles by 2035. The company didn’t abandon that pledge Tuesday, but sounded a note of caution on softening EV demand, echoing messages from other automakers recently.
“GM is very committed to an all-EV future. We’re not changing any of our goals there,” Barra said. “We’re just trying to make sure the company is more agile and resilient so that we can be successful as we manage this transition.”
Chief Financial Officer Paul Jacobson said the company was working to improve the profitability of producing electric pickups before accelerating production.
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The transition to EVs is a big worry for the UAW, which is concerned workers could lose jobs or end up with worse pay as automakers build new factories. To try to prevent this, the union is demanding that the Big Three include their battery factories in the union’s main contract with the companies. Most of the battery plants are still under construction, in joint ventures between the Big Three and their South Korean partners. GM’s joint venture with LG Energy Solution is called Ultium Cells.
Two weeks ago, Fain said GM had agreed to this demand, but GM declined to comment. Barra offered new details Tuesday. “We did put an offer on the table that would put the Ultium cells under the scope of the master agreement,” she said, but added that any deal on this point must have “operating flexibility.”
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