The United Auto Workers has notched a lot of wins in the last few days in standoffs with the Detroit automakers over electric vehicles and their batteries — but with an asterisk.
New tentative agreements — on Wednesday with Ford; on Saturday with Stellantis, maker of brands like Dodge, Ram and Jeep; and on Monday with General Motors — help assure that workers will play a large role in making EVs and at higher wages than they might have expected.
But the deals come as many auto buyers are balking at EVs’ high sticker prices. Automakers in turn are slowing their EV investments, which raises questions about what workers will ultimately win, and whether traditional automakers will continue to prosper as they compete with a dominant Tesla.
“It’s a record contract in terms of economics for the workers, and makes up for a lot of ground they lost over the last decade and a half, and gives them a little bit of a head start going forward,” said Marick Masters, a professor who studies labor and business at Wayne State University in Detroit, about the agreements.
“But,” he added, “I would say it does nothing to guarantee … the companies’ successful transition to electrification.”
Regardless, some observers say the deals mark a positive turning point for the role of labor in making EVs.
“It’s, like, a big-ass deal,” said Jason Walsh, the executive director of BlueGreen Alliance, a nonprofit that represents both labor and environmental groups. “‘If this all pans out, it was a huge strategic victory for the UAW.”
Combined, the new agreements go a long way toward allaying union workers’ fears that closing internal-combustion manufacturing plants and opening new ones for EVs would give the automakers an opening to shake themselves loose from their expensive labor contracts.
“They told us for years that the electric vehicle transition is a death sentence for good auto jobs in this country,” said UAW President Shawn Fain in a Facebook address Saturday. “We stood up and said, “No.’”
However, uncertainties about the industry are imposing a shadow over the otherwise sunny results for workers.
GM and Ford have both signaled in the last week that they are slowing down building both EVs and the factories that produce them. The automakers cited uncertainties around the strike and an overall cooling of the EV market and said they wanted to retain the flexibility to respond to consumer demand.
“EVs are still in high demand,” said Ford CEO Jim Farley during a call with investors last week. “It’s just … the pricing is much lower, and there’s a lot of overcapacity in the middle of the market.”
Ford has said it is pausing construction on an EV-assembly plant in Michigan and a battery plant in Kentucky. Mary Barra, GM’s CEO, said last week that the company is dropping its target to make 400,000 EVs by the middle of next year.
Political relief for Biden
The settlement of strikes does remove a political risk for President Joe Biden, who counts strong unions and strong EV sales as among his top priorities.
Had the six-week strike dragged on, it could have sparked an economic downturn. Instead, Biden was able to trumpet a return to normalcy.
“They have reached a historic agreement and a hard-fought agreement,” Biden said in comments at the White House on Monday.
The UAW made clear that the resolution of its fights with the Detroit automakers is the prelude to a new round of organizing.
In a post on X, the social media platform formerly known as Twitter, the UAW encouraged other, nonauto unions to schedule their contracts to harmonize with the UAW’s “so that together we can begin to flex our collective muscles.”
The union hopes that its success in wrestling concessions from GM, Ford and Stellantis will spark a wave of organized-labor agitation at other major automakers. All foreign-based automakers in the U.S., from Toyota to BMW, do not have union representation.
‘When we return to the bargaining table in 2028, it won’t just be with the Big Three, but with the Big Five or Big Six,” the UAW said on X.
The first target, Masters said, would probably be Tesla, by far the country’s No. 1 electric automaker, whose CEO Elon Musk is vociferously anti-union. “That’s going to be their No. 1 priority in terms of organizing in the next several years,” he said.
What the UAW won
The auto union had two key demands related to EVs when the strike began. It sought the ability to unionize future battery plants, which would expand the union’s membership and influence. It also wanted workers from closing internal-combustion plants to have the right to migrate to new ones making electric cars.
The UAW achieved a mixed record in getting what it wanted from the strike, experts said. Many of the details of the deals remain hazy because the automakers have not confirmed the UAW’s assertions.
The deal with Ford is most well known. Since that contract settled first, and since the agreement has been approved by the UAW’s National Ford Council, the union has sent the general terms to union members, for a vote that will go until the middle of November.
One important provision for EVs relates to organizing Ford’s new factories.
If they choose to unionize, workers at a future battery factory in Michigan and an EV-assembly plant in Tennessee will have the right to join the same UAW master agreement that governs Ford’s other facilities, under the terms. But workers at other battery plants — those operated as joint ventures with South Korea’s SK On — will not have that option.
The deal applies to Ford’s planned battery plant in Marshall, Mich., though “special provisions … will be negotiated based on the unique circumstances,” according to the UAW’s summary.
The other plant, the Tennessee Electric Vehicle Center, is a 4-million-square-foot factory where Ford intends to build vehicles for the Ford and Lincoln marques, especially electric trucks. Workers got the right to transfer to the facility from Ford’s Dearborn Truck Plant and the Rouge Electric Vehicle Center, both based in Dearborn, Mich.
Finally, the UAW said, Ford agreed that union members will have the ability to get jobs at the SK-Ford’s joint-venture battery plants in Tennessee and Kentucky.
That last one is important, Masters said. Even if the plant itself wasn’t doesn’t become unionized, it could open a spigot of ex-union Ford employees into the plant, which might sway the factory floor’s sentiment toward organized labor.
Last week, Ford said it is slowing $12 billion in EV investments, and specifically called out a delay in building one of the two battery plants planned in Kentucky.
Ford did not respond to a an email asking for confirmation of the UAW’s terms.
‘We have saved Belvidere’
The agreement with Stellantis, according to the UAW, took on a different dimension.
Stellantis will reopen a plant it has closed and add a battery factory that will employ thousands. The factory at issue is the Belvidere Assembly Plant, northwest of Chicago, which the company closed indefinitely in February, idling 1,300 workers who assembled Jeeps.
‘We have saved Belvidere,” said Rich Boyer, the UAW’s vice president, an an address alongside Fain on Saturday.
A Stellantis spokesperson declined to comment.
More details will emerge about the UAW’s deals with Stellantis and GM in the next week or so as they go for a vote before the union’s national councils and then by the union workers.
GM, for its part, has agreed to UAW representation at its battery plants, though details are scant. GM’s batteries, under the brand name Ultium, are to be produced at four factories, three of which are joint ventures with LG Energy Solution, subsidiary of the South Korean LG conglomerate, and one with Samsung Electronics.
Earlier this month, Fain announced that GM had agreed to the step, though such a request faces a significant hurdle: The automaker does not have full say over the plant’s future, since they are joint ventures.
During its earnings call last week, Barra said, “We did put an offer on the table that would put the Ultium cells under the scope of the master agreement.”
The UAW’s successes in forcing its way into the future EV and battery ecosystem impressed some observers, such as Kurt Bauer, an analyst for the auto-sales website ISeeCars.com.
“I think [the automakers] going from ‘no, this isn’t even on the table’ to ‘this is subject to discussion’ … is a huge improvement for the UAW,” he said.
