UAW Strike Ends After Labor Contract Finally Passes

The United Auto Workers (UAW) officially ended their strike and ratified a new labor agreement across the Detroit Three automakers — Ford, GM, and Stellantis. The contract was approved by 64% of the voting members from the three companies.

The implications of the ratified contract have set the automakers’ wheels in motion. While GM and Stellantis are still digesting the news, Ford’s CEO Jim Farley plans to visit factories soon. Farley stated that due to the added operating costs from the new labor agreement, Ford must focus on enhancing productivity and efficiency to increase competitiveness.

GM’s manufacturing head, Gerald Johnson, also said he would be touring factories, asserting that employees will “work aggressive schedules” to meet the high demand for new vehicles. This surge in demand is following a targeted strike that halted operations at four GM assembly plants and 18 parts distribution centers.

The new agreements herald a win for the UAW, representing about 150,000 autoworkers from the Detroit Three, as they managed to reclaim large provisions lost during the Great Recession. These include cost-of-living adjustments (COLA), annual bonuses for retirees, and the removal of wage tiers.

Despite these benefits, some GM workers voiced dissatisfaction with the pension increase, contributing to several GM assembly plants voting against the agreement.

UAW Strike Aftermath

Huge compensation increases are on the horizon, with contracted workers set to receive a minimum 33% increase after COLA and compounded wage increases, with some of the lowest-paid workers receiving a raise of over 160% over the 4.5-year contract period. The union also secured a three-year wage progression to the top pay rate, down from the previous eight years, at all three automakers.

In addition, the UAW has secured commitments from all three companies to create thousands of electric vehicle (EV) and battery jobs under the union’s national agreements. Retirees are also set to reap the benefits, with the first annual bonuses in 15 years providing a $1.25 billion boost in total benefits. This is a billion-dollar increase from the total accrued across the last four contracts. Workers hired before 2007 at all three companies will also see a $5 increase in their pension multiplier for the first time in over 15 years.

Stellantis is taking strides to reboot an assembly plant in Belvidere, Illinois, which was idled in February. As part of its commitment, the automaker is poised to construct a $3.2 billion battery plant, providing jobs for more than a thousand union workers.

Ford’s agreement was ratified comfortably, with 69.3% (or 26,679 votes) in favor and 11,825 votes against. However, Farley emphasized that the company must continue reducing costs and waste throughout its operations.

Reacting to the UAW’s proclamation, Stellantis reasserted its commitment to its Dare Forward 2030 strategic plan and customer service. Stellantis COO, Mark Stewart, announced eight all-new electric vehicles set to launch in the U.S. market by 2024.

At GM, the vote was narrowly passed with 54.7% (or 19,683 votes) in favor and 16,274 votes against. GM continues to monitor the situation closely and plans to adapt to the changes introduced by this new labor contract.