UAW rejects offers as Detroit prepares to strike against three automakers

Sept 13 (Reuters) – The union is preparing to strike against three Detroit automakers, United Auto Workers (UAW) President Shawn Fine said on Wednesday, a day before four-year labor contracts expire on Thursday night.

Fine said the Detroit Three automakers have offered wage increases of up to 20% over four and a half years, but the increases have not been enough.

The combined strikes represent a simultaneous labor stoppage at all three Detroit automakers and are among the largest U.S. industrial labor actions in recent years.

“We’re making progress, but we’re still a long way off on our top priorities,” he said in a Facebook Live address.

Ford Motor ( FN ) has proposed a 20% wage increase, General Motors ( GM.N ) 18%, and Chrysler-parent Stellantis ( STLAM.MI ) 17.5%, Fine said. That’s less than half of the 40% wage increases the union has sought — including an immediate 20% increase upon contract approval and 5% annual raises.

Fine outlined a strategy to “create confusion” for the Detroit Three automakers.

Reuters reported late on Tuesday that the union could strike at targeted auto plants if it fails to reach new contracts covering 146,000 U.S. auto workers.

The Michigan-based Andersen Economic Group estimates that a UAW strike that shuts down Detroit Three manufacturers could cost auto makers, suppliers and workers more than $5 billion and disrupt the broader auto supplier network.

Stellandis confirmed on Wednesday that he had been offered a third chance.

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“We await their response to this latest offer,” the company said in an email to employees. “Our focus is on negotiating in good faith to get a tentative agreement on the table before tomorrow’s deadline.”

Stellandis said last week it had given US hourly workers a 14.5% raise over four years, GM workers a 10% raise and two additional 3% annual lump sums over four years. Stellandis did not provide additional totals last week.

U.S. President Joe Biden “encouraged the parties to stay at the table and work 24/7 to secure a win-win agreement that puts UAW workers at the heart of our automotive future,” White House economic adviser Jared Bernstein said Wednesday.

Biden called top executives from all three automakers last week to “encourage them to make more forward-leaning offers to be on the table,” Bernstein added.

AFL-CIO President Liz Shuler told Reuters auto workers do not want to go on strike “but they will if they want to reach a fair deal.”

Schuler noted that there have been more than 200 strikes in the United States this year. “It’s because the economy is in shambles. Workers are tired,” he said.

The UAW and GM met Wednesday for a new round of bargaining, sources said.

A Detroit rally was planned

The UAW said it plans a rally in Detroit on Friday that will include Fein, Senator Bernie Sanders and other members of Congress.

The UAW is considering targeting only certain plants for walkouts at three Detroit automakers, two sources on the matter said, adding that the strike plan could still change.

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Targeting strategic plants could quickly force automakers to shut down U.S. production and extend the time before the UAW’s $825 million strike fund runs out.

The UAW initially sought a 20% wage increase and four annual 5% raises, but offered to reduce those raises to a total of 36%, three sources told Reuters. Fine said the union is still seeking raises totaling 40%. “We’re at 40% — that’s our requirement,” Fine told CNBC.

Ford last week upped its offer to a 10% wage increase and lump sum payments through 2027 after offering 9% pay increases and 6% lump sum payments.

The union’s demands include limited pensions for all workers, 32-hour work weeks and additional cost-of-living increases, as well as job security guarantees and an end to the use of temporary workers.

David Shepherdson reports; Editing: Christina Finzer, Nick Zieminski and Deepa Babington

Our Standards: Thomson Reuters Trust Principles.

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Joe White is a global automotive correspondent for Reuters based in Detroit. Joe covers a wide range of auto and transportation industry subjects and writes for The Auto File, a three-times-weekly newsletter about the global automotive industry. Joe joined Reuters in January 2015 as lead transportation editor for planes, trains and automobiles, and later became global auto editor. Previously, he served as global auto editor for The Wall Street Journal, where he oversaw coverage of the auto industry and ran the Detroit bureau. Joe is the co-author (with Paul Ingrassia) of Comeback: The Fall and Rise of the American Automobile Industry, and he and Paul shared the 1993 Pulitzer Prize for Beat Reporting.

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