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GM, UAW reach tentative agreement to end six-week strike

By MAY ZHOU in Houston | China Daily Global | Updated: 2023-10-31 10:29
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An independent contractor hauls vehicles made at the Spring Hill General Motors manufacturing plant as Union members picket General Motors in the midst of a tentative deal being reached with the United Auto Workers, which expanded its strike over the weekend to the General Motors engine plant in Spring Hill, Tennessee, US Oct 30, 2023. [Photo/Agencies]

The United Auto Workers and General Motors announced Monday they have reached a tentative agreement for a new labor contract, ending a six-week coordinated strike against Detroit automakers that became the longest US auto strike in 25 years.

The deal came after the UAW reached similar deals last week with Ford and Stellantis, which makes Ram, Dodge and Chrysler vehicles.

All three tentative deals must be approved by local UAW leaders and then ratified by a simple majority of each automaker's union-represented workers. That process will take several days.

Terms of the GM deal weren't released, but it is believed to be similar to the deals the UAW has reached with Ford and Stellantis. In those agreements, autoworkers will receive an immediate 11 percent raise in the top hourly wage rate, additional pay hikes totaling another 14 percent during the 4 1/2 years of the contract, as well as a cost-of-living adjustment (COLA) to protect workers from rising prices.

It is estimated that those terms could lead to over 30 percent more pay for union members over the life of the contract.

In addition, less senior workers not at the top pay scale would get even larger pay increases, up to 150 percent. Temporary workers would be made permanent full-time workers after a few months on the job.

The retirement benefits would be increased for senior workers who have traditional pension plans, and companies will make larger contributions to the 401(k) plans of workers hired since 2007.

The job action began on Sept 15 when about 13,000 UAW workers went on strike at one plant at each of the three automakers, and the number gradually increased to more than 48,000 workers at nine plants, with about 18,000 UAW members at GM on strike, 16,600 at Ford and 14,000 at Stellantis.

GM CFO Paul Jacobson had previously said that the company was expecting to take a loss of pretax earnings by $800 million this year, and the strike would cost another $200 million per week.

"They have reached a historic agreement," President Joe Biden said Monday after speaking with UAW President Shawn Fain. The deals, he said, "reward autoworkers who gave up much to keep the industry working and going during the global financial crisis more than a decade ago".

Biden, who has touted himself as pro-union, had picketed with striking workers at a GM factory in Michigan last month.

Management is making big salaries compared to the workers.

In 2022, Stellantis CEO Carlos Tavares made $24.8 million, Ford CEO James Farley was paid $21 million, and GM CEO Mary Barra received $29 million, according to media reports.

The UAW leadership has argued that the automakers were making record profits while their employees struggled with reduced benefits for retirees, lower pay for newer hires, and the effects of the worst inflation in 40 years.

However, the deals might have other consequences too, including higher auto prices.

"The strike result is as likely to lead to non-union car companies doing everything they can to keep the UAW out, including voluntarily increasing benefits to their workers, as it is to lead to the UAW unionizing their plants," University of Michigan Professor Erik Gordon told Reuters.

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