The UAW strike is entering its 40th day

Yesterday, the UAW expanded its strike to a Stellantis pickup truck plant in Michigan, one of the company’s most profitable locations. This latest walkout of ~6,800 workers brings the total number of UAW-represented on strike at the Big Three Detroit automakers to more than 40,000, per the union.

The sticking points: Generally speaking, negotiations have been like a car in neutral on a slightly declined street – inching forward. Stellantis made its latest offer Thursday, which included 23% wage increases, a nearly 50% increase in company contributions to retirement plans, and other enhanced benefits.

The walkout of some of its workers comes days after UAW President Shawn Fain told members the car companies have made some progress in meeting the union’s demands, but he still believes the UAW can get more. Both GM and Ford also are offering 23% wage increases, per Fain.

• Workers were initially seeking an across-the-board wage increase of 36%, the restoration of traditional pension plans, and a 32-hour week with 40 hours of pay, among other things.
• But the Big Three have strongly pushed back on these demands. They’re in the midst of a costly EV transition and hoping to close a cost gap between them and competitors – including Toyota and Tesla – that don’t pay union wages.

Behind the union’s strategy: Rather than push all their chips to the center of the table and call an all-out walkout at one company, the UAW has been gradually expanding the strike at some of the Big Three’s most-profitable factories. This simultaneously impacts the automakers’ bottom lines while also preserving a fund to pay workers on the picket line.

👀 Looking ahead… The latest estimates indicate these strikes have cost the economy ~$9.3 billion, though consumers and dealerships have been largely spared so far. We’ll get more of a window into the economic toll this week, with Q3 earnings due from both GM (today) and Ford (Thursday).