US Auto Union Warns $5 Billion Economic Loss if Strike Occurs on 10th

GM, Ford, Stellantis
Labor Disputes Over Treatment Improvements and Job Cuts
First Simultaneous Strike Since Establishment
Michigan, Biden's Reelection Impact
Appealing for Agreement to Soothe Voter Sentiment

The United Auto Workers (UAW), the largest labor union in the U.S. automotive industry, has announced a strike, raising concerns about significant economic losses for the U.S. economy. The UAW cites not only demands for better working conditions but also job losses due to the Biden administration's accelerated transition to electric vehicles as reasons for the strike. If the UAW strike, a key Democratic support base, materializes, it is expected to deal a considerable blow to President Biden's reelection campaign.

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On the 10th (local time), major foreign media reported that if the three major U.S. automakers?GM, Ford, and Stellantis?go on strike, an estimated economic loss of about $5 billion (approximately 6.67 trillion KRW) could occur over 10 days.

The UAW is a union representing about 400,000 workers in the automotive and machinery sectors across the U.S., including 150,000 workers from the three major automakers GM, Ford, and Stellantis.

Currently, the UAW is in conflict with these three companies over issues related to improving working conditions. Despite the companies posting earnings surprises due to improved sales performance, workers have not received adequate compensation. The union is also concerned about job losses resulting from the transition to electric vehicles. They point out that while the Biden administration has provided massive subsidies to electric vehicle and battery plants through the Inflation Reduction Act (IRA), it has not prepared measures to address job losses among manufacturing workers.

Accordingly, the union has warned that if negotiations with the three companies are not concluded by the contract expiration date on the 14th, they will proceed with a strike. However, even after two months of negotiations, no agreement on wage increases has been reached, increasing the likelihood of a strike.

This strike is expected to have significant economic and political repercussions. Since its establishment in 1935, the UAW has never simultaneously struck against all three companies. Anderson Economic Group, a consulting firm in Michigan, warned, "Both strike participants and manufacturers will suffer losses amounting to hundreds of millions of dollars," and expressed concern that "a situation could arise forcing President Biden, who has shown pro-union tendencies, to take sides, which could cause problems."

Fearing an impact on his reelection, President Biden has sought to appease union voters. The UAW has traditionally maintained a friendly relationship with the Democratic Party and supported President Biden in the 2020 presidential election. On the 14th of last month, he urged all parties to cooperate for a fair agreement, calling for a settlement between both sides. Since the statement began with "The middle class built America, and unions built the middle class," it was widely interpreted as effectively siding with the union.

Moreover, Michigan, where the three companies’ plants are located, is a battleground state with unpredictable outcomes, making it a region President Biden cannot afford to lose in terms of voter support.

Jason Kosnoski, a political science professor at the University of Michigan, told major foreign media, "If President Biden does not support the union, they could disrupt Democratic voters' turnout and reduce youth voter turnout nationwide."

This content was produced with the assistance of AI translation services.