The leaders of the Big Three shrunk to midgets as they walked to the mound against the electrician from Kokomo, playing for the first time in the big leagues.
The corporate players had $20 million dollar contracts. Shawn Fain from the UAW team was on a rookie deal after barely making the squad.
How did Fain and the UAW sweep their World Series?
First, he seemed to understand the game better than the well-paid veterans. He asked for much more than he expected to get, including a 4-day workweek and $40 an hour.
He knew the weaknesses of the Big Three. They had pathetic stock prices, fat recent earnings, and all hated Tesla and Elon Musk. Musk had a monster stock, an electric vehicle that rich buyers worldwide actually liked, and non-union factories.
Musk already had his own battery plant in Nevada, was moving out of his original factory near San Francisco, and owned Twitter to voice his opinions to the world.
Musk’s other big edge was that the Big Three leaders made all of their money on gasoline vehicles and lost money on electrics that the US government was leaning on them to build.
Fain also used their hatred of one another by picking one specific company each week to go on strike. He chose to strike at the specific plants that caused the Big Three the most pain. This strategy also enabled the UAW strike fund to stay well-stocked with cash.
For some reason, the big car guys seemed surprised by these tactics. They were used to negotiating against old-school UAW bureaucrats who played with a predictable playbook.
What Fain understood and exploited was the huge commitment the car people had made to EVs and the politicians who had pushed them into enormous investments. Ford’s F-150 Lightning was supposed to sell 150,000 units this year. It probably will not hit 40,000.
As the strike went on, even though Ford and GM showed enormous quarterly profits from gasoline cars and trucks, it did not help their stocks because it only whetted Fain’s appetite for a fat settlement.
Bill Ford finally caved, giving up almost everything that the UAW bargained for except the 4-day work week. GM and Stellantis soon followed. The workers almost immediately returned to work to pick up the $5,000 bonuses to make up for the strike.
After this bargaining fiasco, I can think of three bosses who should be happy to make $40 dollars per hour.
Question: Are you happy with the result of the latest UAW negotiations with the Big Three?
3 Comments
Will lead to higher prices for the consumer and probably more stiff arming the suppliers for concessions. Less human labor possibly as well in the long term. The larger the business the more they will not just give up profit margin and say, “oh well”.
UPS got a new big contract this year, we got a letter after that saying they are raising rates. TV streaming services have raised prices and indicated they will raise again after the first contract for the writers passed. We shall see how the actors contract goes.
Thanks for commenting!
Good points.
Big companies are continuing to ask for more money and provide less constantly.
Is it really the result of paying their workers?
Or is it their own waste or greed?
I tend to think the latter.
Profits for big business and salaries for the higher ups continue to grow. Wages for the middle class don’t keep up with that prosperity.
There are tons of statistics out there to back that up.
It’s all subjective. What does union workers “deserve.”
I wonder if in the next strike, they will be arguing over if Robots can replace human workers. It’s a little bit like the writer strike issues.
Noah
To your question about waste or greed, in simple terms probably. As complex as the question is though, it is probably a bit of both and more.
The point you make about the corporate leadership getting much higher raises than the rest of us reminds me of something I read years back in a Wall Street Journal article. I can’t say who wrote it or what it was even called. The topic was about the CEO or equivalent, of 1970 vs today. They went on to compare at that time in 1970 (was about that year I think) of what the pay percentage was to the average employee to today. It also talked about how at that time there were more similarities between the CEO and the employees than there are now. That part was really interesting as it layed out the types of beer people drank, the shows they watched on TV and so one.
The point I came away with was things have really changed culturally since then and maybe that has led to some of this lopsidedness in the business world? The global competition, and other factors have made the whole ideal profit margin change as time went on too.
Maybe this point sidetracked some in question to this UAW contract, but I feel that all of this has an influence on the business decisions that are made is some way.