Autoworkers Union Mulls Targeted Strikes Against Automakers As Deal Deadline Looms

Union officials on Tuesday night revealed that the United Auto Workers (UAW) union is contemplating targeted strikes at specific plants of Detroit’s major automakers, namely General Motors, Ford Motor, and Stellantis, if tentative contracts fail to materialize. The 11:59 p.m. ET Thursday deadline looms, with the potential for this plan to evolve as negotiations progress, according to two anonymous sources cited by CNBC, who remain cautious as the plans have not been shared with the union members.

These targeted strikes would focus on local contract issues unique to individual plants, a departure from the all-encompassing national strikes that occurred four years ago during the last negotiation cycle with GM. The UAW President, Shawn Fain, was set to elucidate the strike strategy to the broader union membership via a Facebook Live event scheduled for 5 p.m. ET on Wednesday.

Throughout this negotiation process, Fain and other UAW leaders have consistently emphasized that they have contingency plans if agreements are not reached by the impending deadline. This includes the possibility of instigating strikes across all three automakers, mobilizing approximately 146,000 UAW members to picket lines instead of assembly lines.

The intricacies of conducting targeted strikes can be challenging, as it remains uncertain how actions at one plant will reverberate through others. This approach might potentially lead nonstriking union members to unemployment lines, contingent on whether their respective states permit the collection of benefits for being out of work due to a strike. Companies also retain the option to counter these strikes by locking out workers or hiring permanent replacements for striking employees.

Implementing targeted strikes offers a financial advantage to the union, as it reduces the need to disburse “strike pay” from its $825 million strike fund. The fund typically provides each eligible member with $500 per week, theoretically covering approximately 11 weeks if all members participated in a strike. However, this calculation does not account for healthcare expenses, such as temporary COBRA plans, which could potentially deplete the fund more rapidly.

The UAW has chosen not to comment on this strategy, which was initially reported by The Detroit Free Press on Tuesday, aptly named the “stand-up strike” in contrast to the historic “sit-down strike” of 1936 and ’37.

Following reports of the union’s strategy, Ford CEO Jim Farley expressed optimism late Tuesday night, affirming the company’s commitment to reaching an agreement with the UAW within the next two days. He noted that negotiators were working tirelessly, even spending nights at the company’s offices, in their pursuit of finalizing a deal with the union.

Information for this briefing was found via CNBC and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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