Will US Big 3 Auto Strikes Expand... UAW President Says "21% Raise Proposal Absolutely Unacceptable"

"Union members are ready." As the simultaneous strike by the United Auto Workers (UAW), which represents the three major American automakers, enters its third day, UAW President Shawn Fain rejected Stellantis' proposal for a 21% wage increase, reaffirming the intention to expand the strike. President Joe Biden, who has positioned himself as 'pro-union,' is dispatching senior White House officials to Detroit this week to mediate the situation.

[Image source=AFP Yonhap News]

On the 17th (local time), President Fain appeared on CBS's Face the Nation and stated, "While workers have been stepping back, companies have made enormous profits over the past decade," adding, "Our demands are justified. We are asking for our fair share in this economy, the fruits of our labor." The UAW, which began striking on the 15th after the collective bargaining deadline expired, is demanding a 36% wage increase over the next four years (based on a revised proposal), citing inflation and other factors, while the companies maintain a maximum increase proposal of around 20%.

On the same day, President Fain described the 21% wage increase proposal from Stellantis, the parent company of automotive brands such as Chrysler and Jeep, as "a no-go," emphasizing, "We made this very clear to the company." The UAW resumed negotiations to reach a collective bargaining agreement starting the previous day. Additional negotiations were scheduled for the day, indicating that the gap between management and the union remains wide. The UAW stated in a press release the day before that "productive talks were held with Ford," but did not provide such an assessment regarding negotiations with General Motors (GM) and Stellantis, which are also involved in the strike.

Fain also hinted at the possibility of expanding the strike soon. When asked whether the strike, currently ongoing at only three plants in Michigan, Ohio, and Missouri, would spread to other factories, he stressed, "We are ready to do whatever it takes," and "Union members are ready."

Regarding the companies' argument that it is difficult to raise wages to the union's demands due to intensified cost competition with non-union companies like Tesla and Toyota, Fain countered, saying, "Labor costs account for about 5% of the vehicle price," and "Even if we double our wages, the companies can still make billions in profits without raising vehicle prices." Additionally, he called on President Biden, who has described himself as the most pro-union president in history, to "show action, not just words," and expressed support for the ongoing strike.

This is the first time since the UAW's founding in 1935 that the Big Three automakers have gone on strike simultaneously. Approximately 12,700 workers are participating in the strike, and the number is expected to increase depending on the negotiation situation. If this unprecedented simultaneous strike by American automakers prolongs, its impact on the overall economy is expected to be significant. Local media, citing reports from University of Michigan economists, predicted that the effects, including on jobs, will first become visible in ten states ranked by production volume: Michigan, Kentucky, Missouri, Ohio, Texas, Illinois, Indiana, Kansas, Tennessee, and New York.

President Biden has dispatched officials to Detroit this week to mediate the negotiations between both sides. According to NBC, White House advisor Gene Sperling and Acting Labor Secretary Julie Su are expected to stay in Detroit from early this week and are currently in contact with stakeholders by phone. An administration official explained that Sperling and Su will not intervene directly in the negotiations but will "support the talks in whatever constructive way the parties see fit."

With his re-election bid next year, President Biden faces inevitable political repercussions if the simultaneous strike drags on. Shortly after the strike began, he urged the companies to share profits, stating in a White House speech, "Automakers have not fairly shared their record profits with workers. I understand the grievances of auto workers." NBC reported, "This strike will be a particular challenge for Biden, who has called himself the most pro-union president in history." Former Vice President Mike Pence, a Republican presidential candidate, appeared on CNN the same day and blamed Biden, saying, "This strike shows the reality of failed Bidenomics."

Meanwhile, The Wall Street Journal (WSJ) reported the day before that even before the UAW strike began, there had been a series of backlash strikes in the U.S. against the latest technologies such as artificial intelligence (AI), causing lost workdays to soar to the highest level in about 20 years. Analyzing Labor Department data, WSJ estimated that lost workdays due to strikes last month reached 4.1 million, the highest monthly figure since August 2000. The sharp increase in lost workdays is interpreted as the combined effect of simultaneous strikes by Hollywood actors and writers, as well as communications unions. With the addition of the auto workers' strike this month, the scale is expected to grow even larger.

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