UAW Demands Would Add $80 Billion To GM’s Labor Costs
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As contract negotiations with the United Auto Workers union, or UAW, continue, the “Detroit Three” or “Big Three” automakers – GM, Ford, and Stellantis – could face $80 billion in extra yearly labor costs, according to unnamed sources speaking to Bloomberg.
The costs would be driven by a shortened 32-hour work week, new retiree benefits, cost-of-living adjustments, return of earlier pensions, and the 46 percent boost to wages sought by the UAW.
The sources claimed that meeting all the demands of the UAW would raise labor costs for the Big Three to $150 per hour versus the $64 per hour currently incurred. For comparison, labor costs at non-unionized automakers such as Toyota amount to $55 per hour, while Tesla’s outlay for labor at its EV plants is between $45 and $50 hourly.
Notably, labor costs are not identical with hourly wages, but include total costs for labor, including wages, benefits, and other payments and expenses. For example, the highest-paid Ford UAW production worker receives $32 per hour in actual pay, with most receiving less, but unionized labor costs for the Detroit Three are $64 per hour.
Meeting the UAW contract demands would put the survival of the Big Three automakers in jeopardy, according to the individuals speaking with Bloomberg.
Meanwhile, new UAW president Shawn Fain continues to take an aggressive stance during negotiations. In a dramatic gesture Fain recently flung a copy of Stellantis’ contract proposal into a trash basket during an interview, exclaiming “Stellantis’ proposals are a slap in the face.” The automaker – parent of the Jeep, Dodge, and Ram brands among others – tabled the ideas of reducing medical coverage, hiring more temporary workers, and changing profit-sharing methods.
Fain is using strong negotiating tactics in pushing for UAW demands, including mentioning that the union is prepared to go on strike if its 150,000 workers at the Big Three don’t get what the union believes is a fair deal. The UAW is also seeking political support, withholding its endorsement from President Joe Biden as it looks for his help. Likely challenger Donald Trump has recently courted the UAW, blasting Biden’s “ridiculous Green New Deal crusade” in an effort to capitalize on the sore spot EV manufacture represents for the union.
GM has pushed back against the UAW demands, issuing a statement that the union’s list of wants “threaten our ability to do what’s right for the long-term benefit of the team.” The General also said it wants to “protect U.S. manufacturing and jobs in an industry that is dominated by non-unionized competition.” GM also put up a negotiations website to present its side of the matter.
The parties have about a month remaining to iron out their differences, with the current UAW contract expiring on September 14th.
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Get ready for a two or three month strike. So, Mary can sell down some inventory.
What inventory?
Perhaps Mary who is severely OVERPAID…SHOULD TAKE A SEVERE PAYCUT!
If the $80b is accurate, the three manufacturers will be finished off for good. And the UAW will be crushed permanently. The workers can enjoy doing nothing from home then and reflect on how good they had it.
Let’s only hope. Let their brands be sold off and run by individuals who truly have a passion for their heritage.
Let me guess. “Passion for the heritage” means outdated, obsolete muscle cars driven by mullet wearing middle age men who refuse to grow up.
Let me comment, more like something other than boring look alike crossover SUV’s. GM used to build a variety of interesting vehicles. I won’t stoop to denigrate your generation any more directly, like you did. Have a nice day.
It’s probably not accurate.
The “sources” are the automakers trying to create a false narrative. This is a classic union-busting tactic.
According to unnamed sources. You might as well tell me trump won the election.
Tesla has it right in being non-union, putting the flexibility of their company and their product ahead of the flexibility of the bureaucratic mess that is Big Unions. Just as Musk destroyed the status-quo in Big Tech by implementing massive layoffs, purging Twitter/X of its excess fat, he’s going to do the same with the automotive industry. Soon enough we just might see the much needed destruction of the UAW as Ford and GM see that it’s possible to run an automotive business without the cancer that is the UAW.
Lies lies and more lies. 4000 employees at my plant only 600 are tier 1 a make that full pay and over 1200 make $19 or less. A nobody believe 32 hr work week is coming. This is all just their way of trying to make uaw look like they are asking for to much. Everyone thinks everyone else makes to much money when they make more than u. U want more money , fight for it don’t ask that others make less so u feel better about yourself
Sounds like it’s the UAW making the UAW sound like they are asking for too much….Must be nice to make $32/hr and receive profit sharing to repeat a 50sec task over and over for 30 years, a task designed for ANYONE of any ability to be able to perform. When the plants close, have fun working harder for $15 an hour at Home Depot…
It is nice mayor of realville. See you are the jealous ppl that I’m talking about. I don’t know what u do but go fight for a raise don’t knock us for our money. Makes no sense. Except jealousy. I’m sorry u make what u do I wish we all made a good livable wage but we won’t get there fighting with each other which is what the rich ppl want
That’s the beauty of it bosses say. Like Workers battering their heads out in a boxing ring and the bosses walking away with the biggest purse!
I work at GM myself and a vast majority of the profmduction workers are making about $20 a hour. I’m a electrician and my pay rate is basically thr highest of any hourly GM worker and I make $34 a hour.
I hope they get the 32 hour week.
I want a 32 hour week.
Im an engineer…. I dont make 32/hr. Why should anybody earn that much for turning screws? Thats kinda the point of a career. If you want more, move up to a different position.
Hey Steve!! Technician here!!
Fun fact about engineers, and why we deserve more money
We have to work the stuff you either poorly engineered, and never fixed, or we have to deal with the recalls from the stuff you poorly engineered and never fixed, and now the company might lose too much money over.
You don’t think we’re worth more money, drop the pencil, and pick up an impact wrench.
You sound like a good Union Worker.
Your job will be in Mexico or China soon.
Mine will still be in my finished basement.
Enjoy the commute in today….
Good luck with that job in your basement. AI is already coming after your job.
No worries……Climate change, Global Warming is gonna nail us before AI does. Hopefully the animals will survive!! LOL ALL LOVE!
Best post today! James
That’s $64K a year for being an engineer? Maybe the engineers should form a Union!
My neighbor is an aerospace engineer in San Diego he makes $144,000 a year.
Maybe you are working for the wrong company.
My neighbor is an aerospace engineer in San Diego. He makes a $144,000 a year.
Maybe you are working for the wrong company.
Steve , why should anybody earn anything then. Your argument makes no sense. How about cus the money is there to give a someone has to work there. If you’re jealous come get a job. Also. Tell us. How much $ should they make?
time to raise msrp on 25my by 20k across each model and see how many suckers we can get to buy our plastic ipad dashes and finance at 11% as mary and co laugh all the way to the record profit and bonus bank
Yes, we deserve more of a cut.
My shop charges 180/hr to work.
I only see 25 of that.
Explain why that’s okay, when your lives, and productivity are literally in my hands.
how much of your health insurance do you pay? how much of the shop rent/taxes do you pay? their insurance? their utilities, their equipment? do you get paid when you arent working but on the clock getting your 25?
so you see, you cost them a lot more than 25. i think you should be paid more but also have all those expenses deducted from your pay split between the employees. let me know how much you actually take at the end of it. id guess it wont be much more than 25 after it’s said and done. im sayin that because im sure you think you should be getting 150 out of the 180 charged to the customer :)))
$25?
You are NOT ASE if that is your rate…
That’s “Jiffy Lube” pay bro…
You aren’t paying the light bill, gas bill if so fitted, insurance of several types, that wonderful extortion called taxes, another extortion called a Business License, the inspection and permit for the air compressors, signage, advertising, rainy-day funding for vandalism mitigation, benefit packages if so offered, and the idea that those who take the risk of starting a business should get something out of it is a good start as to why you don’t see more.
If you are not satisfied, shop your skills around, and try for a better offer. I had an employer in Moorpark CA who had my pay so low that my budget was getting tighter than the E string on a violin. I shopped my abilities, got a FAR better offer in a state with 60% of the cost of living, and waved them good bye. You can as well. There are always positions for GOOD mechanics.
Let’s hear it for Mary Buick Envision Made in China-Barra and the $29 million compensation package she received in 2022.
lol, you clearly don’t know what you’re talking about.
Before I explain some stuff, here’s a very large logical hurdle you can’t seem to cross:
If nobody shows up to fix cars, how’s the shop making that money??
Half of my insurance is paid by the company.
Shops pay rent?! LOLOLOLOLOLOLOLOLOLOLOL!!!
The equipment I use maybe once a week?!LOLOLOLOL!! I supply my own tools, like 90% of everyone who does this!!
No, I think I should be paid more, and the customer should pay less. I have to let people slide on things because I don’t want to charge people 90 bucks for wiper blades.
You people will do anything to defend the corporations that rip you off!! You’re right, I make 25 (a lot of places charge the same per hour, and pay the tech way less) for them to get 180 out of you. They should be charging 250/hr. Matter of fact, I’m going in today, and I’m going to make 12 hrs in 7. Thank you for the inspiration to make a bunch of people way poorer!!
UAW does not “FIX” cars…
I think you tripped over that “Logical Hurdle”
Your L and O keys seem to be stuck. I guess it isn’t in your union cobtract to fix tfat.
That’s for the LOL-er technician. He’s still on break.
There was a heart-warming movie done about such a tech years ago. the LOL-er was faithful and loving, and everyone returned the love and affection until one day, he was seen stumbling through the plant, growling, and with foam around his mouth. He had to put down and everyone was so sad. The movie is on LaserDisc, Beta, and CartriVision. The title is Old LOL-er.
The UAW negotiations could be trouble for GM. The UAW has a history of demanding more now from the most prosperous strike target first and then demanding that settlement at all other UAW organized automobile companies whether they could afford it or not. This strategy helped drive the small, independent automobile manufacturers out of the automobile business and kept Chrysler in a difficult position. Also, the UAW forcing the pattern agreement at lower value-added parts operations made vertical integration economically unsustainable. GM tried to make its parts making operations economical through automation, but automation could not make up for the pattern agreements. Eventually GM had to consolidate its parts operations under Delphi and then spin it off. It the UAW took a longer-term approach, maybe some of the independents would still be in business and GM would still be a fully integrated company. I bet that many employees and communities would be better off if the UAW took a longer-term view in its negotiations.
UAW = More expensive everything
The big three should tell them all to beat it
It is “UNSKILLED” labor
They repeat a mind-numbing task for 5 hours a day
They are NOT MECHANICS
I really don’t care how many “Union Boys” this post offends
You could all be replaced with non-English speaking, uneducated foreigners in a day…
Oh wait…. That’s the plan!
Lol
You do realize that GM employs nurses, electricians, tool and die makers, mechanics, mold makers, etc…. so your saying they are unskilled?
Unions are totally out of control. It seems their main purpose is to destroy the US economy. Very sad indeed. Cheers!
$80 billion would finish off GM. Don’t be greedy.
This is what G.M. gets for giving the UAW a blank check the last several contracts. Now the beast demands to be fed.
Unions have destroyed labor in the United States. A 46 percent wage increase, are you serious? Unions have destroyed the Postal Service, Amtrack, Airlines, Communications, Freight and soon the Auto Industry. It’s time for these worthless union parasites to take their place in the history books and let’s move forward and repair the damage they’ve inflicted and return the US Labor force to profitability and accountability!
The Unions haven’t destroyed the Postal Service, Congress put gross financial burdens on them called the Postal Accountability and Enhancement Act of 2006.
I won’t get into the politics of it so if you’re interested you can check what parties were in charge of Congress and the White House at the time. The PAEA gave the Postal Service new accounting and funding rules for its retiree pension and health benefits in an effort to force them to privatize. Up until 2006, the USPS funded those obligations on a pay-as-you-go-basis, pulling out of its pension fund and adding to it as retirees’ costs came in. But the PAEA required the Postal Service to calculate all of its likely pension costs over the next 75 years, and then sock away enough money between 2007 and 2016 to cover most of them.
As far as the other industries mentioned, I suggest looking at the upper tiers within those industries, possibly poor management (to use your word) parasites?
Hank as you might already know USPS is a quasi-government agency. They do not receive any tax payer money. HOWEVER, USPS had to pay 10 years in advance retiree health care. None of the other tax supported government agencies had to do that. That kept USPS $5 billion in the red every year. UAW gave back to GM in 2008 when when US was in a recession with promise that when GM was back on its feet it would keep their promise to give UAW better wages and benefits from what I understand. GM ‘welched’ as well as US government bailed out GM and then US Government sold back stocks at a loss. Like you said let the upper echelon management take the hit including and not limited to Mary Barra
I’m in complete agreement with you Arnie with one caveat. GM, Ford and Chrysler were huge contributors to the US decisively winning WWII. Immediately ceasing auto production and retooling for whatever weapons of war were needed, so I’m not opposed to bailouts for the Big 3 however paying back US loans should be closely monitored and extremely important to the US taxpayers.
Good in point on WW2. Thank you for reminder. And yes, loans should be monitored more closely. On other avenue, I am happy reform leadership finally won the rank and file a one member, one vote democracy in both Teamsters leadership and UAW. Those unions previously were run by a ‘fiefdom’. Young workers do not like ‘vibe’ of ‘fiefdom’ past criminal leadership that sold rank and file out. just as most do not like organized crime. Took RICO Act to make it all happen. I am retired, however, working non-union jobs for $5 per hour labor with no benefits and then having a good union job with USPS made me humble and grateful for opportunity to have and participate in a Union. Best job I ever had was having a UNION with collective bargaining!
Everyone is quick to blame the UAW (or Unions in general) or the workers. If you were ever to walk around any of the GM, Ford or Chrysler offices you would see a whole lot of management and middle management employees. Many large corporations are extremely top heavy and a whole lot of bolts and screws have to be turned to sustain all of those suits that don’t produce one thing. In the US CEO to worker pay is 272-to-1 (figures run as much as 475:1 but I took the lowest ratio) in Japan 11:1, Germany 12:1, France 15:1, Mexico 47:1. Many statistics can be found but no matter the number they all boil down to US CEO’s making many times more than the average worker compared to their foreign counterparts. Seems to me that there is one word to describe this: GREED. Why deny the workers a decent wage when the CEO’s are making so much. And many times it’s not even performance based. At times the companies may be losing money but the CEO’s still receive their top pay, perks and stock options. Don’t bash the workers that are represented by Unions for wanting their piece of the pie. Don’t be jealous of workers that have a Union representing them. Organize a Union of your own if you’re not happy with your work situation. Every employee has that right and every worker, even management employees have a right to withhold their services if they are unhappy with their compensation.
Hank: Your post recalled my recent concern, that some of our elected officials want Medicaid recipients to work, how silicon valley banks were bailed out by US government once again because management ‘gambled’ risk taking (like Hedge funds). The ‘owners’ of our country like it like that, however I don’t hear anything thru ‘owners’ of our country ask their elected government ‘pawns’ to impose on those bank executives any discipline.
Please give a Cost Of Living Allowance for all of us retirees! Social Security gave us a nice COLA, while GM leaves us Retirees Broke!
Including benefits, retirement, our employees average about $70 an hour, no union. We have very little turnover, continuous training, profit sharing and provide family leave. We reward effort and success. We celebrate our team and individual successes in business and personal lives.
We are a profitable private company but do not pay exorbitantly to managers/owners.
We have found success in making sure our company is a team effort from top to bottom.
The Detroit manufacturers and the UAW better figure out how to be competitive as a team or dark clouds are coming. They are in an industry that is brutally competitive and their costs are high. They need to remember how much market share and union jobs have already been lost in previous decades.