Top executives at Ford Motor Co. and General Motors Co. on Friday issued pointed criticism of the United Auto Workers’ leadership as the strike at all three Detroit automakers stretched into a 15th day and expanded to new plants at Ford and GM.
Ford CEO Jim Farley accused the union of “holding the deal hostage” over the automaker’s four planned electric-vehicle battery plants in the United States.
And GM CEO Mary Barra claimed in a statement that the UAW has “no real intent to get to an agreement.”
The remarks came on the heels of the union expanding its strike to two more plants: Ford’s Chicago Assembly Plant, which builds the Explorer, a police utility vehicle, and the Lincoln Aviator; and General Motors Co.’s Lansing Delta Township Assembly plant, which builds the Buick Enclave and Chevrolet Traverse. In all, about 25,300 autoworkers out of some 146,000 Detroit Three workers represented by the UAW now are on strike across the country as the historic work stoppage entered its 15th day.
“Here’s the bottom line from Ford’s perspective,” Farley said during a news briefing Friday. “First, Ford has offered an incredible contract that would change the lives of over 57,000 workers for the better. Second, we believe the UAW is holding up the deal over battery plants that won’t come online for another two to three years. And finally, we still have time to reach an agreement and avert a real disaster — but not much more time, given the fragility of the supply base.”
Ford officials noted that the company has offered a number of contract improvements, including wage increases of more than 20% over the length of the contract, cost-of-living allowances, health care coverage that they say would put workers in the top 1% of all Americans, improved retirement contributions, more time off, layoff protections for permanent employees, and product commitments for all UAW-represented plants in the United States, among other items. They said the company has “continued to negotiate and improve its offer” since Sept. 12, when Ford presented a proposal ahead of the strike.
“The deal we offered would put our UAW workers among the best-paid hourly manufacturing jobs in the world, and in the top 30% of all full-time workers in America, of any industry, hourly and salaried,” Farley said. “Record contract? No problem. Mortgaging our future? That’s a big problem; we will never do it.”
Ford claims that acquiescing to all of the union’s demands — which include bringing back defined benefit pension plans for all workers, higher wage increases than what Ford has detailed, and additional job security provisions — would add billions more in costs that would make the company uncompetitive and perhaps even unprofitable.
“A bad deal would threaten, now, midsize and more expensive, larger vehicles like Escape and Explorer,” Farley said. “We’d have to choose to cut future investments in those products, restructure and reduce our headcount throughout the company, including UAW workers. What’s really frustrating is that I believe we could reach the compromise on pay and benefits, but so far the UAW is holding the deal hostage over battery plants.”
Meanwhile, Barra pointed to what GM has described as a “historic contract” offer, which includes a 20% wage hike including a 10% raise in the first year, raises for temporary workers, and cutting in half from eight years to four the time it takes full-time permanent workers to reach the top of the wage scale.
“It’s an offer that rewards our team members but does not put our company and their jobs at risk. Jeopardizing our future is something I will not do,” Barra said. “It is clear (UAW President) Shawn Fain wants to make history for himself, but it can’t be to the detriment of our represented team members and the industry. Serious bargaining happens at the table, not in public, with two parties who are willing to roll up their sleeves to get a deal done.”
The UAW responded to her comments in a post on social media saying that neither Barra nor Farley attended bargaining sessions this week.
Battery plant talks
At issue, according to Ford executives, are negotiations over four battery plants Ford is building in the United States. Three are part of a joint venture with South Korean battery manufacturer SK On. One of those plants is being built in Tennessee alongside a Ford-owned EV assembly plant; the other two are being built in Kentucky. The fourth plant, in Marshall, would be a wholly-owned Ford subsidiary that would assemble lithium iron phosphate batteries using technology licensed from Chinese battery maker Contemporary Amperex Technology Co. Limited, or CATL.
More: Ford ‘pausing’ construction of Marshall EV battery plant
“Keep in mind, these battery plants don’t exist yet. They’re mostly joint ventures. And they have not been organized by the UAW yet because the workers haven’t been hired, and won’t be for many years to come,” Farley said. “They won’t scale until the next contract.”
The plants in the South are slated to open in 2025; the Marshall plant, on which Ford confirmed this week it would pause construction, initially was slated to open in 2026.
Without going into specifics, Ford executives said that the UAW is seeking to have the battery plants included in the master agreement between the company and the union.
Marshall project considerations
Farley said Friday that Ford does not intend to cancel the Marshall project, but that it is reevaluating the scope based primarily on three factors: labor costs, the final language of the Inflation Reduction Act, and how the next contract with the UAW affects the company’s ability to invest in the products that would be supplied by the plant. The project has met with intense opposition at the local level, as well as scrutiny from Republican lawmakers at the state and federal levels over the licensing of technology from a Chinese company.
“Politics are not part of that calculus,” Farley said. “It’s a $3.5 billion investment, thousands of workers, and we have the optionality of making it bigger or smaller.”
Where negotiations stand
Fain said Friday that talks with the Detroit automakers have not broken down, and Ford officials seemed to agree with that assessment, even as it was clear that the union remains far apart from the companies on some key issues.
“The battery plant discussions have been very difficult, and we have felt from the very beginning … that the regional strike was premeditated and that everything is taking way too long, that actually events are predetermined before they happen,” Farley said. “I don’t think we’ve reached the point where we think we’re at an impasse but that date could come if this continues.”
Ford executives said they believe they are “really close” on economic proposals, but view the battery-plant talks as a sticking point.
The UAW, however, disputed that characterization.
“I don’t know why Jim Farley is lying about the state of negotiations. It could be because he failed to show up for bargaining this week, as he has for most of the past ten weeks. If he were there, he’d know we gave Ford a comprehensive proposal on Monday and still haven’t heard back,” Fain said in a statement.
“He would also know that we are far apart on core economic proposals like retirement security and post-retirement healthcare, as well as job security in this EV transition, which Farley himself says is going to cut 40 percent of our members’ jobs.”
Ford officials said in their remarks Friday that they do not expect to see job losses in the near-term from the EV transition.
Speaking to reporters outside of GM’s Lansing Delta Township plant shortly after it went on strike Friday, Fain called Ford executives’ comment “not true” and “sad.” He said the statements are “ironic” given the fact that Farley has been to just three bargaining meetings: “That’s for show in my opinion.”
He also referenced UAW-represented workers at a joint-venture battery plant owned by GM and LG Energy Solution in northeast Ohio who up until recently started out making $16.50 per hour.
“That’s not a just transition in anybody’s book and our tax dollars are financing that transition,” Fain said. “There’s no excuse when taxpayers are financing that transition that those should be poverty jobs.”
Staff Writer Beth LeBlanc contributed.
