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UAW votes overwhelmingly to authorize strike at Detroit Three automakers

FILE PHOTO: UAW President Shawn Fain chairs the 2023 Special Elections Collective Bargaining Convention

By Joseph White, David Shepardson and Shivansh Tiwary

(Reuters) -The United Auto Workers (UAW) union on Friday said members voted overwhelmingly in favor of authorizing a strike at the Detroit Three automakers if agreement is not reached before the current four-year contract expires on Sept. 14.

The authorization was approved by 97% of voting members at General Motors, Ford Motor and Stellantis, said UAW President Shawn Fain, who leads the union that represents about 150,000 workers.

Fain reiterated that the union did not plan to extend the deadline to get a new labor contract. "The deadline is Sept. 14. We have a lot of options that we are looking at but extension on the contract is not one of them."

Separately, President Joe Biden, who met with Fain last month, told reporters in Nevada he is concerned about a potential UAW strike.

"I think that there should be a circumstance where jobs that are being displaced are replaced with new jobs" for UAW members "and the salaries should be commensurate."

Some senators want national UAW agreements to cover jobs at battery joint ventures that currently pay less.

Fain said workers had made numerous concessions over the last two decades including giving up wage hikes, defined benefit pensions and post-retirement health care benefits.

"We're fed up," Fain said, listing a series of demands. "We've sat back for decades while these companies continue to just take and take and take from us."

Fain has outlined an ambitious set of demands, including wage hikes of 46%, an end to the tiered wage system that pays new hires less than veterans, reinstating cost-of-living adjustments and restoring defined-benefit pension plans for new hires that the automakers ended in 2007. At Stellantis, just 30% of hourly U.S. workers are eligible for defined benefit pensions.

Fain said he expected the Detroit Three to come to the bargaining table next week with counter proposals to the UAW demands. He said talks were "still going slow" after opening in July. Analysts estimate a more than 50% chance of a strike.

It was not clear how long it would take a strike to significantly reduce Detroit Three inventories. Through July, Stellantis U.S. Ram, Jeep, Chrysler and Dodge each had more than 100 days’ inventory but many specific popular models have less.

The vote does not guarantee a strike will be called, only that the union has the right to call a strike if there's no agreement by Sept. 14.

GM, Ford and Stellantis have said they want to reach a deal that is fair to workers but also gives the companies flexibility, as the industry shifts to electric models that have fewer parts and require less labor.

Ford shares were up 1%, while General Motors were unchanged in afternoon trade.

(Reporting by Shivansh Tiwary in Bengaluru, Joe White in Detroit and David Shepardson in Washington, Additional reporting by Nathan Gomes and Steve Holland in Nevada; Editing by Arun Koyyur and Emelia Sithole-Matarise and David Gregorio)