Demonstrators during a United Auto Staff (UAW) practice picket outside the Stellantis Mack Assembly Plant in Detroit, Michigan, US, on Wednesday, Aug. 23, 2023.
Jeff Kowalsky | Bloomberg | Getty Images
The United Auto Staff labor union launched targeted strikes against the three Detroit automakers early Friday morning. The stoppages affect three plants that make popular models equivalent to the Ford Bronco, Chevrolet Colorado and Jeep Wrangler.
It’s the primary time in history that the UAW has struck all three of the Detroit automakers directly. But while the strikes began at the identical time, they could play out very in a different way in the times to come back — with Stellantis potentially facing a tougher road to a deal than its crosstown rivals Ford Motor and General Motors.
Stellantis has a problem that its local rivals don’t. The corporate, formed in early 2021 from a merger between Fiat Chrysler Automobiles and French automaker Peugeot, has more production capability world wide than it needs. Stellantis has signaled that it intends to shut or sell 18 of its U.S. facilities, including factories and parts depots. The corporate has a total of about 35 factories and parts distribution centers within the U.S. now.
That is a plan that the union is unlikely to just accept willingly.
It’s possible that Stellantis has been preparing for a lengthy strike with that in mind: The corporate had more vehicles in its U.S. dealer inventories initially of September than either of its crosstown rivals.
The auto industry measures inventory when it comes to “days’ supply,” based on the speed of sales of every model over the previous 30 days. In accordance with data from Cox Automotive, all 4 of Stellantis’ U.S. brands had more than 100 days’ value of vehicles on dealer lots or in transit to dealers as of the start of September. GM’s Cadillac and Chevrolet brands had just 46 days’ and 51 days’ value of vehicles, respectively; the Ford brand had 77 days’ value.
The industrywide average was 58 days’ supply as of the start of the month. Historically, the Detroit automakers have tended to have somewhat larger supplies readily available because their full-size pickups are offered in many alternative configurations.
In contrast to the strike against Stellantis, the UAW’s strike against Ford could be relatively transient. From comments made by UAW President Shawn Fain and Ford executives in recent days, it appeared that Ford was the closest of the three automakers to a take care of the union. The UAW could have recognized that when it selected to strike only a part of Ford’s Michigan Assembly Plant, the areas where vehicles are painted and where final assembly happens. The entire UAW-represented employees at GM’s assembly plant in Wentzville, Missouri, and Stellantis’ Jeep Wrangler factory in Toledo, Ohio, walked out last night.
GM employees with the UAW Local 2250 Union strike outside the General Motors Wentzville Assembly Plant on September 15, 2023 in Wentzville, Missouri.
Michael B. Thomas | Getty Images News | Getty Images
General Motors may be spared a protracted strike. Details made public from GM’s final offer before the strike, on Thursday, suggested that its offer was much like Ford’s, with a 20% wage increase over the four-year term of the contract, more vacation days and two weeks of parental leave, amongst other concessions.
If Ford reaches agreement with the UAW soon, GM could follow soon after by utilizing Ford’s deal as a template.
But as of Friday morning, Stellantis gave the impression to be buckling down for a long battle.
“We’re extremely disillusioned by the UAW leadership’s refusal to interact in a responsible manner to succeed in a fair agreement in the most effective interest of our employees, their families and our customers,” the corporate said in a statement following the walkouts. “We immediately put the Company in contingency mode and can take all the suitable structural decisions to guard our North American operations and the Company.”
In keeping with past practice following a strike, the UAW and the automakers will take a break from negotiations on Friday. Meetings are expected to resume this weekend.