With already pressed capacities and ordering delays, what will the UAW strike mean to commercial work truck fleets? - Photo: Work Truck

With already pressed capacities and ordering delays, what will the UAW strike mean to commercial work truck fleets? 

Photo: Work Truck

The UAW strike continues. 

The current contract between the United Auto Workers Union and the "Big Three" Automakers, which includes Ford, Stellantis, and General Motors, expired at 11:59 p.m. on September 14, 2023. 

The Associated Press reported that original UAW demands included a "46% pay raise, a 32-hour work week with 40 hours of pay, and a restoration of traditional pensions." 

UAW President Shawn Fain had stated he planned to drive a "hard bargain with the Detroit Automakers," but was quoted by the AP as "acknowledging the union will have to give up some of its demands to reach agreements."  Unfortunately, that did not occur.  

UAW Strike Updates Week of October 30, 2023: Tentative Agreements Coming Along 

On October 30, 2023, the UAW announced a tentative agreement with General Motors on a new labor contract, according to updates from Reuters. 

Late last week the UAW reached deals with Ford and Stellantis but General Motors was still in the works. 

Details have yet to be announced, but according to reports the package is the same wage increases that were agreed upon at the other two OEMs, which included top pay raises for veteran workers of 33%

UAW Strike Updates Week of October 23, 2023: Unrest Growing Once Again but Deals Possible

Up until now, only Ford's Kentucky Truck Plant had been majorly impacted by the UAW strike. This week, Stellantis and GM were majorly impacted and again, the vehicle's include popular commercial fleet models

On Monday, October 23 approximately 6,800 workers walked out of the plant that manufacturers the Ram 1500 pickup truck. According to a UAW release, they are targetig Stellantis due to concerns over the proposals they are receiving during ongoing negotiations. 

On October 24, about 5,000 workers walked in Arlington, Texas. According to a GM spokesperson, the facility builds the full-size Chevrolet Tahoe, GMC Suburban, and other vehicles. The strike occured just moments after the automaker announced Q3 earnings. 

In GM's earnings report, it noted that the UAW strike has already cost the company $800 million in lost production. This was before the Arlington plant was added to the strike. 

According to reports from CNBC, "More than 45,000 UAW members at the Detroit automakers, or roughly 31% of union members covered by the expired contracts, are now on strike. Another 7,000 or so, or about 5% of the workers, have been laid off due to ripple effects of the strikes, according to the companies."

Looking at updates from October 26, Ford and the UAW have reached a tentative deal to end the strike. The negotiations include a record pay raise. According to a report from Reuters, The proposed accord, which UAW's leadership must still approve, provides a 25% wage hike over the 4-1/2-year contract, starting with an initial increase of 11%. 

In addition on October 26 Mack Trucks released a statement regarding its discussions with the UAW: 

"Company and UAW negotiators were able to reach tentative agreements this week on the four local agreements that were not ratified by UAW members on Oct. 8. However, UAW leadership’s economic demands at the master contract level continue to be unrealistic," according to a company release. "Mack stands by the economic terms of its Oct. 1 tentative agreement with the union, which UAW leadership endorsed and called a “record” contract for the heavy truck industry."

UAW Strike Updates Week of October 16, 2023: A Little Quiet 

After 36 days of the UAW strike, things were a little quiet for the past week but that's not expected to last. And, it's gone beyond the "Big 3."  

On Oct. 19, Mack Trucks noted that the new UAW demands ignore months of good faith bargaining. "Unfortunately, the new UAW economic demands are completely unrealistic,” said Mack President Stephen Roy.  “We’ve already shown that we’re prepared to provide our employees with significantly improved wages, but we are not prepared to jeopardize the company.” 

UAW President Shawn Fain noted additional information will be shared via Facebook Live on Friday afternoon Oct. 20. 

Stellantis announced that it will not be participating in CES 2024 as part of its contigency plan implemented since the beginning of UAW strike. It has also announced additional temporary layoffs. 

UAW Strike Updates Week of Oct. 9, 2023: UAW Strike Expands to Ford’s Kentucky Truck Plant

In new development, 8,700 members of the UAW walked off their shifts on October 11 at 6:30 p.m. ET, resulting in the closure of the Kentucky Truck Plant in Louisville, a highly profitable facility for Ford Motor Company.

The decision to strike was made by UAW President Shawn Fain and Vice President Chuck Browning after Ford declined to make any further concessions during negotiations.

This action signifies a new phase in the UAW's Stand Up Strike, deviating from previous patterns where strike expansions were timed according to pre-set deadlines. The timing of this move is noteworthy as it coincides with the day before the four-week mark since contracts expired at Ford, General Motors, and Stellantis.

The Kentucky Truck Plant stands as Ford's biggest facility. This Louisville-based factory is responsible for manufacturing the F-Series Super Duty, Ford Expedition, and Lincoln Navigator, collectively contributing $25 billion annually.

The impact of the halt in operations extends beyond the approximately 9,000 direct employees at the plant. These interconnected operations collectively employ well over 100,000 individuals, amplifying the potential economic repercussions of this work stoppage.

Battery Plans to Unionize, Mack Added to Strike

And the UAW has now informed Mack Trucks that their members voted against ratification of a new five-year collective bargaining agreement covering about 3,900 employees at facilities in Pennsylvania, Maryland, and Florida, and that the UAW will strike all of the covered facilities beginning on Oct. 9.

“We are surprised and disappointed that the UAW has chosen to strike, which we feel is unnecessary,” said Mack President Stephen Roy. “We clearly demonstrated our commitment to good faith bargaining by arriving at a tentative agreement that was endorsed by both the International UAW and the UAW Mack Truck Council. “The UAW called our tentative agreement ‘a record contract for the Heavy Truck industry,’ and we trust that other stakeholders also appreciate that our market, business, and competitive set are very different from those of the passenger car makers.

According to a press release, the tentative agreement included a 10% general wage increase in year one for all employees, a compounded 20% increase to general wages over five years, and a guarantee of no increases in health insurance premiums through the term of the contract.

UAW Strike Updates Week of Oct. 2, 2023: Layoffs Begin

Layoffs have begun. The latest updates on the UAW strike as of Oct. 2 from Reuters noted that Ford and General Motors were laying off "another 500 workers at four Midwestern plants." The report notes this is due to the impact of the UAW strike. As of October 4, GM has laid off 2,100 workers in total at five plants in four states and has halted production at its car plant in Kansas due to the strike. 

A new contract offer was presented to General Motors, as well as a new round of bargaining with Stellantis, but no agreements have been made. 

Anderson Economic Group estimated total losses from the first two weeks of the strike resulted in $3.95 billion in economic losses in the first two weeks, consisting of:

  • Direct Wages Lost – $325 million
  • Detroit 3 Manufacturer Losses – $1.12 billion
  • Supplier Losses – $1.29 billion
  • Dealer and Customer Losses – $1.2 billion

The report noted that the second week of the strike was far more costly than the first week, and suppliers have been hit the hardest. Week three targets fleet's popular Ford Explorer among other models, according to Anderson Economic Group.

While not a part of the current UAW strike, Mack Trucks avoided the potential of one when it reached a tentative agreement with the United Auto Workers union on a new five-year contract covering about 3,900 employees at facilities in Pennsylvania, Maryland, and Florida. The agreement must now be ratified by UAW members. Ratification meetings will be scheduled by the UAW. [Read above for additional updates]

“The terms of this tentative agreement would deliver significantly increased wages and continue first-class benefits for Mack employees and their families,” said Mack President Stephen Roy.  “At the same time, it would allow the company to successfully compete in the market, and continue making the necessary investments in our people, plants and products.”

Updates on October 4th are looking a little better though, with Reuters reporting that negotiators for the UAW and Ford have "arrowed their differences on pay increases after a new offer from the automaker amid "really active" talks." 

The United Auto Workers union said later Friday, Oct 6 that it would not expand its strikes against Detroit’s three automakers after General Motors made a breakthrough concession on unionizing electric vehicle battery plants.

According to the AP, "the announcement of the pause in adding factories to the strikes came minutes after GM agreed to bring workers at battery factories into the UAW’s national contract, essentially assuring they will represented by the union."

UAW Strike Updates as of Sept. 29, 2023: Expanded Strike & Ford's Response

The UAW strike expanded once again on September 29. Reuters reports that workers walked off the job at an additional plant for General Motors and Ford, "but the union spared Stellantis after last-minute concessions by the Chrysler parent." 

This grows the strike to approximately 25,000 workers, or around 17% of the union's total, Reuters noted. 

In addition, starting on September 20, a "Solidarity Comvoy" began in Toledo, Ohio with a goal of Detroit, and it arrived today:

 

 

Ford released a statement on Sept. 29 regarding the UAW strike and ongoing negotiations. According to a company statement, the bottom line from Ford's perspective is:

  • Ford has offered a contract that would change the lives of its 57,000 workers.
  • The UAW is holding up the deal primarily over battery plants that will not come online for another two to three years.
  • There is still time to reach an agreement and avert disaster – but not much time given the fragile supply base.

“If the UAW’s goal is a record contract, they have already achieved this,” said Ford President and CEO Jim Farley. “It is grossly irresponsible to escalate these strikes and hurt thousands of families.”

UAW Strike Updates Week of September 25, 2023: Agreement Still Not Reached - Strike Expanding

On Friday Sept. 22, the UAW Strike expanded with members walking out of "all 38 parts-distribution centers operated by General Motors and Jeep and Ram owner Stellantis in 20 states," according to AP reports. Ford has been spared the additional walkouts due to its work to meet additional demands over the past week. 

The UAW shared this list of facilities on social media: 

President Joe Biden has announced his solidarity with the Union workers on the social media platform as well, stating that he will be heading to Michigan on Tuesday to join the workers. 

 

The focus on parts facilities has a heavy potential impact particularly on commercial fleets, who are already struggling to get needed parts during ongoing parts shortages.   

 An agreement has still not been reached as of Sept. 28, with Reuters reporting that the UAW could strike additional Detroit Three facilities on the 29th should negotations not progress further. 

Currently, there 18,300 UAW members on strike. This represents 12% of total union workers, according to Reuters. 

On Tuesday the 26th, President Joe Biden joined picket lines, posting to social media, "UAW members, your president stands with you." 

 

Last year, it was a potential freight rail labor strike threatening commercial vehicle orders. Now you have to factor in a potential government shutdown on September 30 into the mix, too. 

Strike Updates as of Sept. 15, 2023: The Strike Begins 

On September 15, about 13,000 U.S. auto workers stopped making vehicles and went on strike after their leaders couldn’t bridge a giant gap between union demands in contract talks and what Detroit’s three automakers are willing to pay, according to a report from the Associated Press.

Members of the United Auto Workers union began picketing at a General Motors assembly plant in Wentzville, Missouri; a Ford factory in Wayne, Michigan, near Detroit; and a Stellantis Jeep plant in Toledo, Ohio.

Reuters reports the walkouts at the Detroit Three will halt production of the Ford Bronco, Jeep Wrangler, and Chevrolet Colorado pickup truck, along with other popular models. Fain laid out plans for the walkouts on Facebook Live, less than two hours before the expiration of the old contract.

It is the first time in the union’s 88-year history that all three companies were targeted simultaneously.

Some analysts are noting the strike is starting smaller than they predicted, but that a larger strike is imminent if negotations don't move forward in a positive direction. Reuters noted targeted walkouts could limit the cost of strike pay to the UAW, which has a $825 million strike fund. 

Strike Updates as of Sept. 14, 2023: A Strike is Looming 

On September 11, workers from UAW Local 644 Dometic-Limerick officially went on strike in advance of the looming contract expiration.

There are less than 24 hours for a strike to be averted. 

On the same day, Reuters reported the UAW was making some headway in labor talks, but that an agreement had still not been reached. Reuters also noted that pay raise hikes may have been trimmed down to 36% in total. 

What Does a Strike Mean for Commercial Fleets? 

Element Fleet Management recently shared their insight on what this could mean for commercial fleets. 

The projected impact of a strike could include: 

  • Production Delays: Temporary assembly plant closures would disrupt fleet vehicle replacements, forcing fleet managers to seek alternative solutions.
  • Shortages of Fleet Vehicles: Extended strikes may cause shortages of preferred fleet vehicle models, resulting in higher costs and operational inefficiencies for fleet professionals.
  • Increased Acquisition Costs: High demand amid low supply could lead to elevated acquisition costs when production resumes, prompting budget reassessments.
  • Rental Market Pressure: Businesses may turn to the rental market during a strike, potentially limiting availability.
  • Impacts on Upfitting and Service: Delays receiving essential OEM components and spare parts may disrupt fleet maintenance schedules.

Automaker Responses to UAW Strike

Nearly 8,000 UAW-represented Ford employees received a substantial raise this Labor Day. With the average rage topping around $10,000 a year with overtime, is it enough to stave off the strike?

On average, these employees now earn $4.33 more per hour, or $9,000 a year. The pay hikes were negotiated by Ford and the UAW in 2019 to shorten the time it takes workers to reach the average top wage rate of $32 an hour.  

“These pay raises are an example of Ford’s commitment to improving the lives of our hourly workforce,” said Bryce Currie, Ford vice president, Manufacturing. “The negotiating teams nicknamed this deal ‘23 Jump Street’ because in 2023 a significant number of UAW-Ford team members would see a jump in pay. And we are offering further improvements in the next contract.”

Normally, growing into the top wage rate takes eight years, but with this agreement, 8,000 employees reached the top wage rates with as little as four years on the job. 

On Sept. 13 Ford released a statement from Jim Farley, president and CEO of Ford Motor Company. 

"On Tuesday, Bill Ford and I sat down with the union at the main table for a major offer. As we were walking in the room, we learned President Fain would not be attending. Nevertheless, Bill and I laid out a historically generous offer to the UAW Ford bargaining team because we listened to the UAW demands and we care about our employees," Farley said.

Ford has put four offers on the table since August 29 and, according to Farley, have not received any "genuine counteroffer." 

"The future of our industry is at stake. Let’s do everything we can to avert a disastrous outcome," Farley added. 

According to Reuters, Stellantis said on Sept. 8 it had offered U.S. hourly workers a 14.5% wage hike over four years.

GM said on Sept. 7 it offered workers a 10% wage hike and two additional 3% annual lump-sum payments over four years. GM purportedly make a new offer over the weekend but that information has not been fully disclosed or verified.  

According to Auto Dealer Today, as the U.S. auto industry waits to see whether the United Auto Workers will strike in Detroit, Hyundai and its labor union have tentatively agreed to a deal to avert a strike across the Pacific.

The UAW Responds

On September 7, UAW President Shawn Fain released a statement in response to a proposal submitted by GM. Based on their response, this situation is still unfolding and on a deadline.

What Can Commercial Fleets Do? 

While some of these actions may be difficult to accomplish now, fleet managers should always do whatever they can to prepare for the unexpected. To be in a better place should possible disruptions occur, fleet managers should consider these proactive measures:

  • Diversify Suppliers: Identify alternate OEM vehicles to reduce reliance on a single manufacturer.
  • Plan Ahead: Obtain advanced approval for alternate vehicles and pricing agreements before a potential strike.
  • Inventory Management: Maintain an adequate inventory of essential vehicles to mitigate supply constraints.

Are you concerned about the potential strike? Have more advice to share with fleet managers navigating these uncertain times? Comment below and share your thoughts and stay tuned as we continue to cover the updates and negotiations. 

Editor's Note: Originally published September 5, this item is being updated with additional information and insights as they come through. 

People Are Quitting Transportation & Construction — Here’s Why

About the author
Lauren Fletcher

Lauren Fletcher

Executive Editor - Fleet, Trucking & Transportation

Lauren Fletcher is Executive Editor for the Fleet, Trucking & Transportation Group. She has covered the truck fleet industry since 2006. Her bright personality helps lead the team's content strategy and focuses on growth, education, and motivation.

View Bio
0 Comments