KANSAS CITY, Mo. — As we watch to see what happens with contracts involving the United Auto Workers and automakers General Motors, Ford and Stellantis, who are also known as the "Detroit 3," it's important to consider the history involved, too.
Over the past decade, these automakers have enjoyed substantial profits.
Together, they posted a net income of $164 billion, with $20 billion of that coming this year alone.
Now, workers want a piece of that pie.
"The big three are making money hand-over-foot, and when the union made concessions, huge concessions back in the 2008 recession, you know, it was with the understanding that when things improved and when profits got better — remember, GM, it got bailed out by the government because it was facing bankruptcy — you know, the understanding was that those things would be returned," said Judy Ancel, the retired director of the institute for Labor Studies at UMKC.
Not only did Ancel teach this subject for decades, she's also currently the executive producer of "The Heartland Labor Forum," a weekly radio show on KKFI KC Community Radio that covers these types of subjects.
"Auto workers make less today than they did 30 years ago if you adjust for inflation," she said.
That's why she says workers and the union president for UAW are making more aggressive demands this go-round; there are approximately 146,000 U.S. auto workers poised to go on strike.
Shawn Fain, the UAW president, has given the three companies a deadline of this Thursday at 11:59 p.m. eastern time to meet their demands.
If an agreement isn't reached, workers could walk out at factories across the country, which could cause significant disruptions for auto production in the U.S..
So, what do workers want? Forty-six percent raises in "general pay" over four years — this would raise a top-scale assembly plant worker from $32/hr to $47/hr.
They also want an end to varying tiers of wages for factory workers
For example, top scale workers make $32/hr, and temp workers start at just under $17/hr.
"There are people who are a temp for GM or Ford or Stellantis for six years and you know, that’s not a temp job — that’s a full-time, low wage job with no benefits," Ancel said.
The UAW also wants to restore traditional pensions for new hires. Currently, they only get 401k style retirement plans.
Workers hired after 2007 don't get "defined-benefit pensions," and get "less generous health benefits"
And, the UAW wants a return of "cost-of-living" pay raises.
Finally, looking to the future, the UAW wants to be able to represent workers at 10 EV battery factories, which would mean those workers would get top UAW wages.
That's because workers who currently make parts for internal combustible engines are planning ahead for making a switch down the road as the auto industry gradually transitions to EVs.
"At this point, the auto makers are not under any kind of agreement that that production will be union, and so this is a big thing that in terms of protecting future job security, that’s a big thing union would like to negotiate," Ancel said.
The companies have made some counter offers, but so far it doesn't appear to be enough to avoid a strike.
It's something Yang Sun, the dean of Park University's School of Management, thinks is likely.
"The likelihood of having a strike going on, is fairly high, as we have seen," Sun said. "You know, the Union has been asking for a lot, and for you know, ultimately, the big three as corporations, they need to look at their financial books and make a decision, and I don’t think they are ready to give up everything yet."
As for how that could impact the economy locally and across the country, Sun says that depends on how long a potential strike lasts.
"One of the most immediate impacts is probably to push the used car price even higher," Sun said.
According to the Associated Press, at the end of August, the three automakers had enough inventory to last for 70 days.
After that, supply could be short, causing demand prices to rise.
"It will cause a shortage of cars. And so if somebody wants to buy a car, it’s going to be more difficult to do that," Ancel said. "It’s going to lower spending, consumer spending, as people tighten their belts."
As for here at home, less money for those workers means less money they'll be able to spend locally.
"You know, keep in mind the fact that our Ford plant is the largest Ford plant in the company," Ancel said. "They have over 7,000 workers there. And those are an awful lot of people who are buying houses, buying cars, spending money in our local economy."
She also says the success of the union in this industry could have a trickle down effect on other sectors.
"If UAW workers, just like if the UPS workers who just settled their contract, if they get significant increases, those are going to trickle down," Ancel said. "The wages that union members make clearly and very directly affect the wages that people who are unorganized make. The stronger the labor movement is, more people who come in under union contracts, the better off the entire working class is in the United States."
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