Pressure is on GM, Stellantis after Ford strikes tentative deal with auto workers

(TND) — The pressure is on General Motors and Stellantis to resolve their labor disputes with the United Auto Workers after a tentative deal with Ford was announced Wednesday.

Labor scholar Marick Masters called the Ford agreement a “significant development.”

The UAW strikes, which are separate but concurrent, were launched 42 days ago and have expanded in stages to include tens of thousands of workers.

But UAW Ford workers are heading back to the job after UAW President Shawn Fain said they "won things nobody thought was possible" in negotiations with the automaker.

“Since the strike began, Ford put 50% more on the table than when we walked out,” Fain said in a video to union membership. “This agreement sets us on a new path to make things right at Ford, at the ‘Big Three,’ and across the auto industry. Together, we are turning the tide for the working class in this country.”

Union members still need to ratify the deal, which Masters said could take about 10 days based on past examples.

The UAW has laid out a five-step plan for ratification, and this was just Step 1.

The agreement grants 25% in base wage increases through April 2028, the union said.

It will cumulatively raise the top wage by over 30% to more than $40 an hour.

It will raise the starting wage by 68%, to over $28 an hour.

The union said the deal “reinstates major benefits,” including cost-of-living allowances and retirement improvements.

The deal eliminates wage tiers and gives members the right to strike over plant closures.

“We are focused on restarting (operations), calling 20,000 Ford employees back to work and shipping our full lineup to our customers again,” Ford CEO and President Jim Farley said in a statement.

Masters, a professor of business at Wayne State University in Detroit, said the deal is “more or less what the union wanted.”

And, as it stands now, this is a union win.

What remains to be seen, other than whether it will be approved by members, is how the increased labor costs will impact Ford’s competitiveness, he said.

The companies are in the midst of a seismic shift away from building gas-powered cars in favor of electric vehicles.

They’re spending billions to make the cars, the batteries and to build out a charging network to help grease the wheels of EV adoption.

President Joe Biden applauded the UAW and Ford for the deal.

“I’ve always believed the middle class built America and unions built the middle class,” he said in a White House statement. “That is especially the case for UAW workers who built an iconic American industry.”

Masters said this resolution with Ford puts additional pressure on the other automakers.

“They have some hard bargaining ahead of them,” he said.

The union will insist on very similar deals with GM and Stellantis (the maker of Chrysler, Dodge and Jeep vehicles).

While small details might be adjusted for each company’s situation, Masters said the big-ticket items will need to be the same.

If the deals are seen as unequal, that will create dissension among the union members and will make ratification difficult.

The clock is ticking for GM and Stellantis, which both say they are committed to "working constructively" with the union to reach deals as soon as possible.

“The effect of a strike compounds over time in terms of their losses,” Masters said.

The UAW’s apparent victory may embolden other unions with their own demands, Masters said.

He also said the UAW offered valuable examples to other unions in terms of savvy tactics and the importance of having a sophisticated media relations campaign as part of a negotiating strategy.