The engines will be able to roar again. After 41 days of strike at American manufacturers Ford, General Motors and Stellantis, the automobile union UAW and Ford reached an “agreement in principle” on Wednesday October 25. A consensus immediately hailed as “historic” by President Joe Biden. “I applaud the UAW and Ford for coming to an agreement after arduous, good-faith negotiation, and for reaching a historic agreement in principle this evening,” Joe Biden said in a White House statement.
What does the agreement provide? First, a 25 percent increase in base pay over four years and cost-of-living allowances, the UAW said. “Ford’s lowest paid workers will benefit from an increase of more than 150% over the life of the agreement,” the union further notes. Concretely: it would eventually raise the maximum wage to more than $40 an hour, giving a member working 40 hours a week a base salary of more than $83,000. For comparison, the current maximum wage is $32 per hour, or about $67,000 per year based on a 40-hour week.
“We made history”
The strikers also won significant gains in pensions and job security. Added to this is the right to strike in the event of factory closures. The agreement still needs to be ratified by workers in a vote to take place in the coming weeks. Ford said he was “satisfied” with this result.
“We have achieved things that no one thought possible,” said Shawn Fain, president of the UAW union, in a livestream on Facebook. “We made history. […] Together, we are turning the tide for the working class of this country.”
Since September 15, the radical unionist has maintained the pressure against the “Big Three”, the three main American automobile manufacturers [General Motors, Ford et Stellantis, NDLR]. This is the first national strike Ford has faced since 1979. Contract negotiations have been very tense, with Shawn Fain frequently attacking “corporate greed.” And the economic consequences for automakers have been swift, with General Motors saying this week that the strike was costing it $200 million a week — and that was before the UAW walked out of an additional GM plant in Arlington, Texas.
The strike, linked to the development of the next collective agreements, mobilized nearly 45,000 employees in total on Tuesday, out of the 146,000 registered at the UAW. “We are focused on restarting the Kentucky Pickup Plant, the Michigan Assembly Plant and the Chicago Assembly Plant, getting 20,000 Ford employees back to work and on delivering our full range to our customers,” said Jim Farley, CEO of Ford, quoted in his group’s press release.
Increase pressure on other companies
Two weeks ago – when it said it had reached the limit of what it could afford without hurting its business – Ford proposed raising wages by 23%, adjusting wages in response to inflation, and to reduce the time it takes for new recruits to reach the highest salary to four years compared to eight. Other companies made similar offers. But the UAW has pushed for broader concessions, stepping up walkouts and targeting factories producing some of the automakers’ most profitable models.
After an agreement in principle, unions sometimes do not end the strike until it has been ratified by the members. “This is a strategic decision aimed at obtaining the best possible agreement,” said Chuck Browning, vice president of the UAW. “The last thing GM and Stellantis want is for Ford to return to full production capacity while they waste time.” This agreement could increase pressure on other companies to reach an agreement with the union.