DETROIT – After 46 days of strikes and negotiations, the United Autoworkers Union finally reached an agreement with GM, after reaching agreements with Stellantis (formerly Chrysler) and Ford in the preceding days. The terms of the agreements raise employees’ pay by as much as 30% over the 4.5 years of the contract, nearly doubling each company’s overall labor costs. UAW President Shawn Fain is already planning, new, bigger strikes starting on May 1, 2028, the day after this new agreement ends.
The agreements provide for a $5000 ratification bonus for all employees, immediately giving all temporary workers permanent worker status, an 11% pay increase the first year and total 25% increase in wages over the 4.5 year contract. The average earnings will increase by 25% over the term of the agreement, and top wages at each company will increase by 33%.
The agreements will make the companies much less competitive with Tesla and other foreign and electric vehicle manufacturers, who do not hire union workers. Tesla’s average labor costs are $45/hour. Toyota averages $55/hour. UAW labor costs prior to the agreement were $65/hour. Wells Fargo estimates that the new contract will increase the average labor cost to $136/hour at each of the Big Three.
The 2022 Inflation Reduction Act, signed into law by president Joe Biden, included substantial federal funding and tax incentives for electric vehicle manufacturing. UAW President Shawn Fain claims that, because of these government incentives, “hundreds of billions of our taxpayer dollars… are helping fund this, and workers cannot continue to be left behind in that equation.”
Fain chose to end this current agreement on April 30, 2028 with an eye towards May 1, 2028 being the first day of the new strikes. He wrote in a recent message to union members, “We invite unions around the country to align your contract expirations with our own, so that together we can begin to flex our collective muscles. If we’re going to truly take on the billionaire class and rebuild the economy so that it starts to work for the benefit of the many, it’s important not only that we strike, but that we strike together.”
The choice of May 1 to start the new strikes is not arbitrary. May 1, called May Day, has been traditionally recognized as Labor Day in communist nations in remembrance of May 4, 1886, when Chicago labor organizers called a citywide strike calling for an 8 hour work day. When police tried to break up a protest in Haymarket Square, a bomb was thrown into a group of police, who responded by killing some of the protesters.
Fain does not shy away from rhetoric that critics accuse of being overtly socialist. In one video he recorded during the strike, he wore a shirt that read, “Eat the Rich.” He also frequently complains about the “billionaire class” in many of his speeches.
Many workers affected by the strikes are relieved that progress is being made even though some believe that it will only hurt the economy due to the inevitable rise in cost that will take place after labor costs increase.