A former Cadillac executive turned consultant says that meeting the lofty demands of the United Auto Workers union, or UAW, would bankrupt the Big Three automakers – GM, Stellantis, and Ford – if the car companies yielded to all of the union’s demands to the letter.
After UAW president Shawn Fain declared “war” on the Detroit Three, threatening an unprecedented triple strike across all three automakers if union members fail to get a 46-percent raise, a 32-hour work week, and a range of other demands, Johan de Nysschen said “the car companies cannot possibly agree to his demands” according to a Bloomberg report.
Johan de Nysschen
“Even if he succeeds, his members still lose because the car companies will go bankrupt,” de Nysschen continued. He also remarked that the UAW members are “easily impressed” and that new UAW president Shawn Fain is “promising the sun, the moon, the Earth and the stars.’
Before his current role as consultant, de Nysschen held executive positions at several automotive companies and brands. Getting his start at Audi, he moved to Infiniti, then to GM brand Cadillac, and finally to Volkswagen after being ousted from his leadership of Cadillac.
De Nysschen was himself a combative leader while in charge of Cadillac, and attempted to reshape the brand according to his ideas. Some of his innovations stuck, while others have been reversed following his removal from control of the luxury brand.
He moved Cadillac headquarters to New York City, separating it from the rest of GM in order to gain more autonomy from central dictates. After he left Cadillac, The General moved brand HQ back to Detroit along with the rest of its major subsidiaries, re-establishing the close control de Nysschen was trying to escape.
De Nysschen also ordered name changes for various Cadillac nameplates, directly leading to the CT-series and XT-series designations for Cadillac models. Once again, since his departure GM has chosen a different path, adopting the naming convention leading to the Cadillac Lyriq, the Cadillac Optiq, and similar models.
UAW strikers in 2019
De Nysschen’s prediction that the UAW demands are impossible to meet without destroying the Detroit Three automakers outright is echoed by arguments from the car companies themselves. Labor costs would soar by $80 billion if UAW workers get the desired raise and benefits, GM and other OEMs assert.
GM said “it’s important to protect U.S. manufacturing and jobs in an industry that is dominated by non-unionized competition.” The General has also launched a website to track the current status of UAW negotiations and present its side of the question.
Despite these arguments, Shawn Fain remains determined to achieve all the goals of the UAW. Union members voted in favor of a possible strike if the contract talks fail to achieve a satisfactory result by the September 14th deadline. Notably, a large-scale 10-day auto workers’ strike could itself cost the economy $5 billion or more according to analysts.
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