The UAW strike is looming. If a deal is not reached by 11:59 pm ET Thursday night, the UAW will strike.
The UAW is the union representing the 3 largest automakers in the United States.
Today, the former CEO of Ford had a lot to say about this pending strike, and had strong words of caution for both sides.
The UAW is seeking was initially trying to get the following:
- 40% pay hike over four years
- restoring annual cost of living increases
- returning to traditional pension plans
- restoring healthcare coverage for retired employees
- restoring healthcare plans to what they traditionally were
The UAW is going in with their entire wishlist, and hoping to get concessions from GM, Ford and Stellantis. However, so far the big 3 auto makers have said what the UAW is demanding is completely unreasonable and won't even entertain bargaining at the table stating that they are two far apart to reach a deal.
The automakers are citing poverty and listing their bankruptcies and bailouts as justification for holding strong against these demands saying they have to live within their means.
The caution Ford's former CEO has to give to the UAW is that they very likely can win this battle, but will likely end up losing the war. If their demands are met, even at 50%, it almost certainly will mean mass layoffs and offshoring manufacturing where there is cheaper labor.
“The automakers are going to be very rational about this. If this is what my cost per unit is here in the US — including labor — and it’s uncompetitive, I’m going to have to move it to where it’s more competitive, like Mexico,” said Fields, who is currently a senior advisor to private equity firm TPG Capital. “You don’t want the UAW to win the battle but lose the war.”
He is also saying EAW's leader is completely wrong about the economic fallout these demands will have.
The caution he has for the automakers is pretty much find a compromise to avoid a strike. This could be a prolonged strike and cost millions if not billions of dollars for the industry.
Over the last 4 years the average price of new cars went up by 30% and the average CEO salary by 40%. The UAW is looking for union members to get their fair share form increased profits. Especially after years of wage stagnation and benefits cuts.