Shulou(Shulou.com)11/24 Report--

Don't let Tesla see our jokes.

Author | Wang Lei Chumen

The unprecedented strike of American auto workers began to change the wind.

Car companies and trade unions have been at loggerheads from the beginning to the current tension. When you push me and shove, the car companies begin to "fight back", and the most direct way is to lay off staff.

A month ago, GM, affected by the strike, closed an assembly plant and laid off 2000 employees. It is reported that the 2000 employees are not eligible for unemployment benefits provided by GM.

Then other car companies began to follow suit, and in the latest news, Ford also said that as a result of the strike, it began to lay off another 550 workers at several factories in the Midwest.

The union wanted to use the strike to force automakers to compromise, but things are getting worse, and now the Big three have gradually shifted from passive acceptance to active layoffs.

The United Auto Workers (UAW) and the Detroit giants General Motors, Ford and Stellantis have been negotiating labor contracts for the next four years since mid-July, and the two sides have not reached an agreement.

The negotiations between the two sides finally failed completely on September 14, US Eastern time, and the trade unions joined forces with tens of thousands of workers to launch a general strike.

Source: the X strike has been going on for a month, and more than 34000 UAW members are striking against the Detroit Big three. The impact and losses to the car companies are undoubtedly huge.

Ford was the first to be affected, announcing about 600 temporary layoffs at a striking assembly plant in UAW, Michigan, the day after the strike began.

A week after the strike, GM was overwhelmed, announcing that it had closed an assembly plant in Kansas and laid off about 2000 employees because of parts shortages caused by the strike. At the same time, GM said laid-off workers would not be eligible for supplementary unemployment benefits as a result of the strike.

Stellantis, another giant, followed suit, saying it would immediately lay off about 370 workers at three parts plants in Ohio and Indiana because of "inventory restrictions" related to the strike.

Layoffs seem to be the prelude to a counterattack by car companies, followed by wave after wave of workers passively "carrying buckets and running away".

Earlier this month, Ford announced that it would cut another 495 jobs as a result of the strike, including 371 from the Cleveland engine plant in Ohio, 94 from the Lima engine plant in Ohio and 25 from the Stirling bearing plant.

Source: XStellantis said on October 13 that it would lay off another 700 workers at two plants in Indiana.

It's not over yet. Ford is arguably the worst of the Big three in terms of layoffs. It is reported that from October 16, Ford will continue to start layoffs: about 300 jobs will be laid off at a transmission plant in Ohio, about 250 at four plants in Michigan and 12 in Chicago.

Ford has cut 2480 jobs since the strike began on September 15 this year. So far, six GM plants have been affected by the strike and have laid off more than 2300 employees. Even Stellantis, which has the fewest layoffs among the three, has left the factory with more than 1000 people.

As a result, the Big three have laid off nearly 6000 employees in the month of the strike.

Source: UAW said the temporary layoffs were mainly due to strikes disrupting the production chain.

By the end of the third week of the strike, losses to Ford, GM and Stellantis had reached $5.5 billion (40 billion yuan), surpassing the previous record of $4 billion, according to a report released by AEG, an economic consulting firm.

If a series of demands from the unions are met, the Big three will increase their spending on labor costs by $45 billion to $80 billion. In this way, layoffs have become the best solution for car companies to control costs.

02. Let's start with a protracted war. Let's take a look back at this unprecedented strike of American auto workers.

The cause is that the United Auto Workers Union feels that the current status of workers is too low and that wages and livelihood are not guaranteed, requiring automobile companies to raise their wages by 40% within four years, and abolishing the hierarchical salary scale system in which workers work for eight years before they are eligible to receive the same remuneration as older workers. at the same time, it puts forward a series of requirements, such as improving the working environment, ensuring employment security, reducing the use of temporary workers, and so on.

However, the big three car companies in the United States believe that this will greatly increase the financial pressure, increasing labor costs by US $45 billion to US $80 billion a year, directly putting themselves into the stage of "bankruptcy in place."

In the week before the strike, the union and the car companies went through several rounds of negotiations, and the car companies also proposed a pay increase of 17.5% to 20% for their workers, but there were no other benefits and did not change the pay system as required by the union.

Obviously, the terms offered by car companies are not attractive, so starting from midnight on September 14, US Eastern time, the UAW officially launched a strike, which is also the first time in more than 80 years since the establishment of the UAW to strike at the same time against the three auto giants.

Source: X what is interesting is that next year is the US presidential election, and US President Joe Biden and his election rival Donald Trump have begun to openly support a trade union strike, adding some political overtones to the strike.

It is not that the auto companies have been on strike for a month without compromise. not long ago, the UAW announced that the labor contract negotiations between the union and the automakers had made progress and would not expand the scale of the strike for the time being.

Source: UAW this is because GM reached an agreement to unionize workers in a joint venture car battery factory, which could clear the way for a final deal if the other two follow suit.

You know, the battery factory has always been the main issue for the union to negotiate with the three giants.

Ford, General Motors and Stellantis all have joint venture battery factories with battery manufacturers, which according to the automakers are owned by joint ventures, so they will not be included in the agreements reached between carmakers and unions now and in the future.

Ford, on the other hand, is constantly compromising the terms of the pay rise, recently proposing a 23% Mel 26% pay increase according to the classification of workers, retaining platinum medical benefits, approving bonuses, restoring cost-of-living allowances and other benefits.

It was the same concession that led a Ford executive to feel that the company's offer to the United Auto Workers (UAW) had "reached the limit".

Source: even so, it didn't meet the union's demands. It turned around and went on strike at Ford's largest and most profitable truck factory in Kentucky, where 8700 auto workers took part in the strike. it directly led to the shutdown of the factory.

It can be seen that car companies try to compromise, but it is still difficult to meet the expectations of the union. Next, there will be a protracted war.

03, "Don't let Tesla see us laugh" the continuous escalation of the strike action, let these automobile giants experience the feeling of "immediate bankruptcy".

Just yesterday, figures released by Anderson Economic Group, a Michigan consulting firm, show that the general strike has so far caused $7.7 billion in losses, including $359 million in wages for workers, $3.45 billion for the three major car companies, $1.21 billion for dealers and customers, and at least $2.67 billion for suppliers.

So far, the UAW has closed six assembly plants and 38 parts warehouses across the United States.

Source: UAW later said that the strike had entered a danger zone and that if it was not settled as soon as possible, it would cause permanent losses, and suppliers would even need financial assistance to resume operations. "We have seen a decline in retail sales, air travel and income tax in Michigan, and layoffs among vulnerable suppliers are increasing, and most of these costs will be borne by workers and small and medium-sized enterprises."

In addition, economist Ian Sheppardson believes that if the situation heats up and turns into a general strike of nearly 150000 union members of the three major auto companies, the quarterly GDP of the United States could be hit by as much as 1.7 percent.

In addition to the strike against the three major car companies, the strike has also begun to spread to other industries in the United States. On October 4th more than 75000 health workers from Caesar Healthcare, the largest private medical institution in the United States, went on strike.

Source: the X strike covers multiple regions and affects a large number of people, making it the largest health care strike in US history.

At the same time, the strike has shifted from the Big three to other car companies. On October 9th 4000 workers at Mack Trucks, an American industrial carmaker owned by the Volvo Group, also decided to strike.

To some extent, the union-led strike among American auto workers has begun to spread across the North American auto industry.

If the strike cannot be stopped in the coming months, it will affect US economic growth in the third and fourth quarters, according to the Capitol Hill newspaper's website. At the same time, capacity cuts brought about by the strike could lead to higher car prices in the face of tight inventories.

It can be said that the longer the strike, the greater the impact on the Big three of the United States. Tesla had the last laugh at this time.

Yesterday, Bill Ford, executive chairman of Ford Motor Company and great-grandson of founder Henry Ford, made a brief speech, saying that Tesla should not see our jokes.

"this should not be a contest between Ford and the union. Toyota, Tesla and other companies like this strike because they know that the longer the strike lasts, the better it will be for them. They will win and we will all lose."

This article is from the official account of Wechat: Chaodian Lab (ID:SuperEV-Lab), author: Wang Lei Chumen

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