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    Will America’s Good News on Inflation Last?

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    One of the biggest economic surprises of 2023 was how quickly inflation faded. A dig into the details offers hints at whether it will last into 2024.Prices climbed rapidly in 2021 and 2022, straining American household budgets and chipping away at President Biden’s approval rating. But inflation cooled in late 2023, a spurt of progress that happened more quickly than economists had expected and that stoked hopes of a gentle economic landing.Now, the question is whether the good news can persist into 2024.As forecasters try to guess what will happen next, many are looking closely at where the recent slowdown has come from. The details suggest that a combination of weaker goods prices — things like apparel and used cars — and moderating costs for services including travel has helped to drive the cooldown, even as rent increases take time to fade.Taken together, the trends suggest that more disinflation could be in store, but they also hint that a few lingering risks loom. Below is a rundown of the big changes to watch.What we’re talking about when we talk about disinflation.What’s happening in America right now is what economists call “disinflation”: When you compare prices today with prices a year ago, the pace of increase has slowed notably. At their peak in the summer of 2022, consumer prices were increasing at a 9.1 percent yearly pace. As of November, it was just 3.1 percent.Still, disinflation does not mean that prices are falling outright. Price levels have generally not reversed the big run-up that happened just after the pandemic. That means things like rent, car repairs and groceries remain more expensive on paper than they were in 2019. (Wages have also been climbing, and have picked up more quickly than prices in recent months.) In short, prices are still climbing, just not as quickly.What inflation rate are officials aiming for?The Federal Reserve, which is responsible for trying to restore price stability, wants to return price increases to a slow and steady pace that is consistent with a sustainable economy over time. Like other central banks around the world, the Fed defines that as a 2 percent annual inflation rate. What caused the 2023 disinflation surprise?Inflation shocked economists in 2021 and 2022 by first shooting up sharply and then remaining elevated. But starting in mid-2023, it began to swing in the opposite direction, falling faster than widely predicted.As of the middle of last year, Fed officials expected a key measure of inflation — the Personal Consumption Expenditures measure — to end the year at 3.2 percent. As of the latest data released in November, it had instead faded to a more modest 2.6 percent. The more timely Consumer Price Index measure has also been coming down swiftly.The surprisingly quick cooldown started as travel prices began to decelerate, said Omair Sharif, founder of Inflation Insights. When it came to airfares in particular, the story was supply.Demand was still strong, but after years of limited capacity, available flights and seats had finally caught up. That combined with cheaper jet fuel to send fares lower. And while other travel-related service prices like hotel room rates jumped rapidly in 2022, they were increasing much more slowly by mid-2023.Travel inflation is returning to normalHotel price increases look much as they did before the pandemic, while airfares have recently fallen.

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    Year-over-year percentage change in Consumer Price Index categories
    Source: Bureau of Labor StatisticsBy The New York TimesThe next change that lowered inflation came from goods prices. After jumping for two years, prices for products like furniture, apparel and used cars began to climb much more slowly — or even to fall.The amount of disinflation coming from goods was surprising, said Matthew Luzzetti, chief U.S. economist at Deutsche Bank. And, encouragingly, “it was reasonably broad-based.”Used car deflation is backUsed vehicle prices fell in 2023. New car prices have been climbing, but more slowly than in 2022.

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    Year-over-year percentage change in Consumer Price Index categories
    Source: Bureau of Labor StatisticsBy The New York TimesThe inflation relief came partly from supply improvements. For years, snarled transit routes, expensive shipping fares and a limited supply of workers had limited how many products and services companies could offer. But by late last year, shipping routes were operating normally, pilots and flight crews were in the skies, and car companies were churning out new vehicles.“The supply side is at work,” said Skanda Amarnath, executive director at the worker-focused research group Employ America.What could be the next shoe to drop?In fact, one source of long-awaited disinflation has yet to show up fully: a slowdown in rental inflation.Private-sector data tracking new rents soared early in the pandemic but then slowed sharply. Many economists think that pullback will eventually feed into official inflation data as renters renew their leases or start new ones — but the process is taking time.Housing inflation remains faster than normalRent increases and a measure that approximates the cost of owned housing are both slowing only gradually.

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    Year-over-year percentage change in Consumer Price Index categories
    Source: Bureau of Labor StatisticsBy The New York Times“We’re likely to see more moderation in rent,” said Laura Rosner-Warburton, senior economist and founding partner at MacroPolicy Perspectives. Because a bigger rent cooldown remains possible and goods price increases could keep slowing, many economists expect overall consumer price inflation to fall closer to the Fed’s goal by the end of 2024. There is even a risk that it could slip below 2 percent, some think.“It’s a scenario that deserves some discussion,” Ms. Rosner-Warburton said. “I don’t think it’s the most likely scenario, but the risks are more balanced.”What could go wrong?Of course, that does not mean Fed officials and the American economy are entirely out of the woods. Falling gas prices have been helping to pull inflation lower both overall and by feeding into other prices, like airfares. But fuel prices are notoriously fickle. If unrest in gas-producing regions causes energy costs to jump unexpectedly, stamping inflation out will become more difficult.Geopolitics also carry another inflation risk: Attacks against merchant ships in the Red Sea are messing with a key transit route for global commerce, for instance. If such problems last and worsen, they could eventually feed into higher prices for goods.And perhaps the most immediate risk is that the big inflation slowdown toward the end of 2023 could have been overstated. In recent years, end-of-year price figures have been revised up and January inflation data have come in on the warm side, partly because some companies raise prices at the beginning of the new year.“There is a bunch of choppiness coming,” Mr. Sharif said. He said he’ll closely watch a set of inflation recalculations slated for release on Feb. 9, which should give policymakers a clearer view of whether the recent slowdown has been as notable as it looks.But Mr. Sharif said the overall takeaway was that inflation looked poised to continue its moderation.That could help to pave the path for lower interest rates from the Fed, which has projected that it could lower borrowing costs several times in 2024 after raising them to the highest level in more than 22 years in a bid to cool the economy and wrestle inflation under control.“There’s not a lot of upside risk left, in my mind,” Mr. Sharif said. More

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    E.U. Relaxes Trade Rules on Electric Cars From Britain

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    The NewsThe European Union plans to postpone strict local-content rules that would have led to costly tariffs imposed on cars traded between the bloc and Britain beginning Jan. 1.“This removes the threat of tariffs on export of E.U. electric vehicles to the U.K. and vice versa,” Maros Sefcovic, the European Union’s executive vice president, told journalists in Brussels Wednesday.The tariffs would have forced consumers in Britain and the European Union to pay more for many electric vehicles. Andrew Testa for The New York TimesWhy It Matters: Relief for carmakers that were facing tariffs.The proposal provides for a three-year delay in the trade rule, and represents a huge reprieve for many carmakers, especially those with plants in Britain. Eighty percent of cars made in Britain are exported, with 60 percent of them going to the European Union. The delay means that British electric vehicles with batteries made outside Europe will no longer face tariffs of up to 10 percent starting in three weeks.European carmakers would have faced similar hits in their sales of cars to Britain, a major market. The delay will probably be seen as a win for Prime Minister Rishi Sunak’s British government, which lobbied for the change along with the European car industry.Background: Europe and Britain do not make enough batteries.The rule would have made it virtually impossible for cars made in Britain with batteries from Asia to be imported tariff-free into the European Union. Neither Britain nor the Europe Union is manufacturing enough batteries for the rising number of electric vehicles expected to be produced in coming years. Batteries are the most expensive components of electric vehicles.Local origin rules are designed to discourage automakers from importing expensive parts, and to encourage local production. But this rule would have been counterproductive, the auto industry argued, by forcing consumers to pay more for many electric vehicles. Those higher prices could have opened the door for electric vehicles from outside Europe, especially China, whose makers are churning out low-cost models that have gained traction in Britain.What Happens Next: Time for the battery industry “to catch up.”The proposal still needs the support of European Union governments. Early indications are that it will be welcomed by auto industry. An extension would give “the European battery industry time to catch up,” the Society of Motor Manufacturers and Traders, a British trade group, said Wednesday in a statement.Mr. Sefcovic also said the European Union planned to provide 3 billion euros ($3.25 billion) to encourage local manufacturing of batteries. More

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    U.A.W. Announces Drive to Organize Nonunion Plants

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    The United Automobile Workers’ effort, with a long-elusive goal, follows its success in securing big raises in contracts with the Detroit automakers.The United Automobile Workers union announced Wednesday that it was undertaking an ambitious drive to organize plants owned by more than a dozen nonunion automakers, including Tesla and several foreign companies — a goal that has long eluded it.The move comes weeks after the U.A.W. won new contracts from General Motors, Ford Motor and Stellantis that included wage increases of 25 percent or more over four and a half years for its 146,000 members employed there.In addition to Tesla, the targets of the drive are two other electric vehicle start-ups, Lucid and Rivian, and 10 foreign-owned automakers: Toyota, Honda, Hyundai, Nissan, BMW, Mercedes-Benz, Subaru, Volkswagen, Mazda and Volvo.The U.S. plants owned by those companies employ nearly 150,000 workers in 13 states, the union said.If the organizing drive gains momentum, it could become one of the largest by the U.A.W. since its infancy in the 1930s. The union’s past efforts to organize even single plants owned by the foreign automakers, concentrated in the South, came to nought. A foothold among those companies would signal a big shift in the American auto industry, where nonunion manufacturers have long had a significant cost advantage over the Detroit automakers.The union said the organizing drive had been prompted by inquiries from several thousand workers at nonunion plants.“Workers across the country, from the West to the Midwest and especially in the South, are reaching out to join our movement and to join the U.A.W.,” the union’s president, Shawn Fain, said in a video posted on Facebook. “The money is there. The time is right.”A Honda statement cited the automaker’s “competitive wages and benefits,” adding, “We do not believe an outside party would enhance the excellent employment experience of our associates.” Subaru did not comment directly on the union drive but referred to a series of wage increases and a comprehensive benefits package.At the DealBook conference sponsored by The New York Times on Wednesday, Elon Musk, Tesla’s chief executive, said, “If Tesla gets unionized, it will be because we deserve it and we failed in some way.” He reiterated his opposition to unions, saying that “it’s not good to have an adversarial relationship” between groups within a company.Rivian and Volkswagen said they had no comment. The other companies did not immediately respond to requests for comment.On Wednesday, the U.A.W. activated websites where workers can electronically sign cards that serve as an official certification of their desire to have union representation. Earlier, at a handful of plants, the U.A.W. had already received signed cards from more than 30 percent of the work force, the threshold required under federal law for the union to move forward with a vote on unionization, a person familiar with the matter said.The union is now working to send organizers to areas around these nonunion plants to collaborate with workers at those factories, this person said.After the U.A.W. reached agreements with the Detroit automakers to raise wages, Toyota, Honda and Hyundai announced that they, too, would increase workers’ pay.Toyota has told workers that it will raise hourly rates 9 percent in January. Honda will lift wages 11 percent and Hyundai 14 percent next year. Hyundai plans to increase wages 25 percent by 2028.The U.A.W. said Wednesday that it was making a concerted effort to organize a large Toyota plant in Georgetown, Ky., that employs about 7,800 workers and produces the Camry sedan and RAV4 sport utility vehicle.U.A.W. members have long earned more than nonunion workers. At plants in the South, wages tend to start below $20 an hour and top out at less than $30. The top U.A.W. hourly wage, previously $32, climbed to more than $40 in the contracts the union signed with the three Detroit manufacturers.The U.A.W. has fallen short twice in the past decade — by narrow margins, in 2014 and 2019 — in unionization votes at a Volkswagen factory in Chattanooga, Tenn. The U.A.W. lost by a substantial margin at a Nissan plant in Canton, Miss., in 2017. Organizing efforts at other companies’ plants have petered out before coming to a vote.But after Mr. Fain became the union’s president this year, the union promised a more aggressive approach to its contract talks with the Big Three and vowed to renew efforts to widen its reach in the industry.In addition to wage gains at the Detroit companies, the U.A.W. won agreements to preserve jobs and to keep open a Stellantis plant in Illinois that had been slated to close.Arthur Wheaton, director of labor studies at Cornell University School of Industrial and Labor Relations, said the U.A.W.’s wage gains created a stronger case for joining the union.“It shows collective bargaining works and shows the U.A.W. was successful,” he said. “They can say: ‘We saved this plant. Look at what we got. You can have this, too.’”Past organizing drives were hurt because the U.A.W. had a tarnished image, Mr. Wheaton added: Many unionized plants had closed, its members had been required to accept wage and benefit cuts to help the Detroit manufacturers survive the 2009 financial crisis, and federal corruption investigations had implicated senior union officials.“A lot of the negative things about the union — a lot of that stuff has gone away now,” Mr. Wheaton said.Santul Nerkar More

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    U.S. Debates How Much to Sever Electric Car Industry’s Ties to China

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    Some firms argue that a law aimed at popularizing electric vehicles risks turning the United States into an assembly shop for Chinese-made technology.The Biden administration has been trying to jump-start the domestic supply chain for electric vehicles so cleaner cars can be made in the United States. But the experience of one Texas company, whose plans to help make an all-American electric vehicle were upended by China, highlights the stakes involved as the administration finalizes rules governing the industry.Huntsman Corporation started construction two years ago on a $50 million plant in Texas to make ethylene carbonate, a chemical that is used in electric vehicle batteries. It would have been the only site in North America making the product, with the goal of feeding battery factories that would crop up to serve the electric vehicle market.But as new facilities in China came online and flooded the market, the price of the chemical plummeted to $700 a ton from $4,000. After pumping $30 million into the project, the company halted work on it this year. “If we were to start the project up today, we would be hemorrhaging cash,” said Peter R. Huntsman, the company’s chief executive. “I’d essentially be paying people to take the product.”The Biden administration is now finalizing rules that will help determine whether companies like Huntsman will find it profitable enough to participate in America’s electric vehicle industry. The rules, which are expected to be proposed this week, will dictate the extent to which foreign companies, particularly in China, can supply parts and products for American-made vehicles that are set to receive billions of dollars in subsidies.The administration is offering up to $7,500 in tax credits to Americans who buy electric vehicles, in an effort to supercharge the industry and reduce the country’s carbon emissions. The rules will determine whether electric vehicle makers seeking to benefit from that program will have the flexibility to get cheap components from China, or whether they will be required instead to buy more expensive products from U.S.-based firms like Huntsman.After pumping $30 million into the project, Huntsman halted work on it. “If we were to start the project up today, we would be hemorrhaging cash,” said Peter R. Huntsman, the company’s chief executive.Callaghan O’Hare for The New York TimesCan the World Make an Electric Car Battery Without China?From mines to refineries and factories, China began investing decades ago. Today, most of your electric car batteries are made in China and that’s unlikely to change soon.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.We are confirming your access to this article, this will take just a moment. However, if you are using Reader mode please log in, subscribe, or exit Reader mode since we are unable to verify access in that state.Confirming article access.If you are a subscriber, please  More

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    Ford Resumes Work on E.V. Battery Plant in Michigan, at Reduced Scale

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    A battery plant in Michigan will be smaller than planned, Ford said, citing slower E.V. demand than expected, as well as labor costs.Ford Motor said Tuesday that it was resuming work on an electric vehicle battery plant in Michigan but significantly scaling back its plans in part because of slow E.V. adoption in the United States.A company spokesman said that Ford now expected the plant in Marshall, Mich., to create 1,700 jobs rather than 2,500, but that it still expected production to begin in 2026.Demand for electric vehicles is “not growing at the rate that we originally expected,” said the Ford spokesman, T.R. Reid. In the most recent quarter, large auto companies like Ford reported that E.V. sales had increased, but not at a rate sufficient to keep up with the Biden administration’s ambitious goals.The plant was originally planned to produce 35 gigawatt-hours’ worth of batteries annually, which Ford estimated was enough to equip about 400,000 vehicles. Now, the plant will produce 20 gigawatt hours annually, enough for roughly 230,000 vehicles, or a 42.8 percent cut.Ford did not specify exactly how much money it would be pulling back from the project, but said it would be roughly equivalent to its reduction in output. If the 42.8 percent cut in output was applied to its investment, it would represent a $1.5 billion reduction in the initially announced investment of $3.5 billion.Ford said in September that it was suspending construction because of concerns that it would not be able to manufacture products at a competitive price. At the time, the company was in the middle of contentious negotiations with the United Automobile Workers union.Rising labor costs were also a factor in Ford’s decision to scale back its plans for the factory, Mr. Reid said. Ford’s contract agreement with the U.A.W., which has been ratified by union members, raises the top wage for production workers by 25 percent.The agreement will allow U.A.W. members to be transferred to battery and electric-vehicle plants under construction, like the one in Marshall. If workers there choose to unionize, they will be protected under the U.A.W.’s contract.The U.A.W. hopes to keep its membership rates up amid the transition to electric vehicles, but the automakers have pushed back, arguing that it puts them at a disadvantage compared with their nonunionized competitors.The U.A.W. did not immediately respond to a request for comment on Tuesday.Ford has also faced criticism from conservative lawmakers over its plan to license technology from CATL, a Chinese battery maker. Lithium-iron-phosphate batteries, or LFP, are not currently produced in the United States. Some U.S. electric automakers, such as Tesla, import LFP batteries from China.It is not clear whether U.S. companies that license technology from other countries will qualify for government incentives to promote the shift from fossil fuels. Mr. Reid said Ford was “confident about the technology licensing agreement for this plant.” More

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    Unions in Sweden Expand Blockade Against Tesla

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    The LatestElectricians and dockworkers across Sweden on Friday joined a widening effort by unions in the country to pressure Tesla to sign a collective bargaining agreement with its mechanics.The labor action expanded three weeks after the autoworkers’ union, IF Metall, called a strike against Tesla in an effort to secure a collective arrangement over pay and working conditions for its roughly 120 members who work as mechanics for the electric vehicle maker. In the latest move, dockworkers at dozens of ports refused to unload cars from ships and electricians stopped repair work at the company’s charging stations, highlighting the power of organized labor in a country where collective agreements cover nine in 10 of all employees.Port workers blocking a ship from loading Tesla vehicles onto a ship moored at the port of Malmo in Sweden, in early November.Johan Nilsson/TT News Agency, via Associated PressTesla in Sweden: No production but many sales.Tesla does not produce any vehicles in Sweden, but runs several facilities where the cars are serviced. So far this year, the Tesla Model Y is the best-selling new car in Sweden, with more than 14,000 registrations through October, according to Mobility Sweden, an industry group.At the outset of the mechanics’ strike, a Tesla representative told Swedish media that the company followed labor laws in the country, and that it chose not to sign a collective agreement. The company said it would do what it could to keep its business operating.Quotable: ‘It is both important and obvious that we help.’The Swedish Transport Workers’ Union, whose members work at Sweden’s docks, said in a statement that “it is both important and obvious that we help, to stand up for the collective agreement and the Swedish labor market model.”How It Started: Mechanics at Tesla went on strike on Oct. 27.In late October, IF Metall, which represents 300,000 workers in Sweden, including some of Tesla’s mechanics, said talks with company representatives had ended without resolution. The union began the strike action at Tesla’s 12 service centers on Oct. 27.Dockworkers initially refused to unload any Teslas at four major Swedish ports starting on Nov. 7, which on Friday expanded to 55 ports.Unions representing cleaners have also refused to service Tesla facilities, and the postal workers’ union stopped any deliveries from reaching the company’s sites.Both IF Metall and the Transport Workers’ Union have acknowledged that Tesla has found ways around the strikes. Tesla appeared to be bringing in other mechanics to staff its facilities and bringing new vehicles into Sweden by truck, they said.The strike efforts have also been hampered by some union members who work for Tesla and refused to join, Swedish media have reported.What Other Unions Say: Germans have voiced support.In Germany, where Tesla produces the Model Y at a gigafactory outside Berlin, union leaders have been seeking to organize the roughly 11,500 employees who work there. Tesla’s leadership has not engaged with the German autoworkers’ union, IG Metall. Last month, several hundred workers wore union stickers calling for “safe and fair work.”Dirk Schulze, the regional head of IG Metall in Brandenburg, where Tesla has its factory, has expressed his solidarity with the striking workers in Sweden. The strike in Sweden has given workers in Germany “the courage and confidence to organize themselves into a union and take their fate into their own hands,” Mr. Schulze said in a statement.The union has not announced any further measures.What Happens Next: More strikes are planned in Sweden.This week, IF Metall said 50 of its members at Hydro Extrusions, a company that produces an aluminum component for Tesla, would walk off their jobs next Friday. More

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    U.A.W. Members at General Motors Ratify Contract

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    The United Automobile Workers union hopes the agreements with General Motors, Ford and Stellantis will help it make inroads at other companies.Members of the United Automobile Workers union have given their backing to new contracts with the three big U.S. automakers, agreements that deliver hefty wage increases and other gains that had eluded the union for more than 20 years.In the most closely contested vote, the tentative contract agreement at General Motors won the support of 55 percent of the nearly 36,000 members casting ballots, according to a tally from all the G.M. locals that the union posted on Thursday.Tentative agreements with Ford Motor and Stellantis, the maker of brands including Jeep and Chrysler, appeared headed for approval by more decisive margins, nearly complete results there showed.A spokesman for the union confirmed the accuracy of the tallies but declined to comment further.The agreements are similar across the three automakers and raise the top wage for production workers 25 percent, to more than $40 over four and a half years, from $32. They were reached last month after a six-week wave of strikes that hobbled the companies — a strategy spearheaded by the union’s new president, Shawn Fain, who had vowed to take a more adversarial approach to negotiations than his predecessors.Workers leaving the Ford Chicago Assembly Plant on Thursday.Jamie Kelter Davis for The New York TimesThe agreements appear to have quickly reverberated across the auto industry, with Toyota, Hyundai and Honda announcing significant wage increase at nonunion plants in the United States only days later.“We call that the U.A.W. bump, and that stands for ‘U Are Welcome,’” Mr. Fain said in testimony before the Senate Health, Education, Labor and Pensions Committee this week. “And we’re very proud of that. And when these workers decide to organize and join the U.A.W., they’re going to realize the full benefit of union membership and get what they’re fully due.”The new contracts also included larger company contributions to workers’ retirement plans and the right to strike over plant closures. All three automakers declined to comment on the ratification votes.Mr. Fain said the union was seeking to capitalize on its momentum by waging muscular organizing campaigns at nonunion plants, and, in remarks submitted to the Senate committee, he added that thousands of workers were already contacting the union and signing union cards.But even Mr. Fain’s tough approach in the talks with the Big Three did not yield terms attractive enough to many union members. G.M. workers at several large plants voted against the tentative agreement by large margins.In contrast, members of the International Brotherhood of Teamsters recently approved a new contract at United Parcel Service with 86 percent support, while a new contract between the Writers Guild of America and Hollywood studios passed with 99 percent support.Rebecca Givan, a labor studies professor at Rutgers University, said Mr. Fain had achieved a major victory despite having taken office only a few months earlier with a goal of reorienting the union.Huey Harris, at the G.M. plant in Flint, said he had voted in favor of the contract despite his belief that it didn’t offer veteran workers like him enough gains.Nic Antaya for The New York TimesDr. Givan said the union’s approach of initially striking at one plant at each of the three automakers and ramping up over time had “really upended a lot of conventional wisdom” in the labor movement and had proved unusually successful at reversing some concessions that the union had accepted years earlier, like the suspension of a cost-of-living adjustment.“This shows that if workers build enough power, they can win things back,” she said.U.A.W. members at Mack Truck also ratified a contract on Wednesday, after rejecting an initial agreement with the company.Across the three automakers, skepticism toward the agreements arose in large part from veteran workers who felt that the proposed contracts did not go far enough to compensate them for years of concessions and weak wage growth, even given strong gains for newer workers. Wages for some newer workers will more than double over the next four years.Huey Harris, a G.M. employee at a large truck assembly plant in Flint, Mich., who has worked at the company for over 20 years, said the deal should have gone further in rewarding veteran workers, though he ultimately voted for it. “The traditional people didn’t think they were offered enough in the contract,” he said.Curtis March, who works at Ford’s Chicago plant and made the inflation-adjusted equivalent of more than $40 an hour in the early 1990s, will make about $36 in the first year of the new contract, he said.Jamie Kelter Davis for The New York TimesSeveral longtime employees of the Big Three automakers said that even after the large gains of the new contract, they would not be making more than when they started their careers.Curtis March, who works at Ford’s Chicago Assembly Plant, said he made about $18 an hour once he reached the top wage for production workers at the company in the early 1990s, equivalent to more than $40 today when adjusted for inflation. He will make about $36 in the first year of the new contract.Mr. March said the deal was likely to pass at Ford because it placated more recent employees, who outnumber veterans like him. Workers at his plant approved the deal after voting against several previous contracts.Despite the ultimate success, the path to ratifying the contracts has included some internal strains for Mr. Fain and the union. Unite All Workers for Democracy, a reform group that played a key role in electing Mr. Fain and six other members of the U.A.W. executive board to their positions, declined to formally recommend that union members approve the contract even after Mr. Fain urged the group to do so at a recent meeting, according to three people familiar with the meeting. Instead, Unite All Workers passed a resolution committing it to stay neutral during the ratification vote, though it stated that the group “celebrates the record gains made in this agreement.”Two of these people also said the union’s General Motors department had been less communicative and less proactive in distributing information about the contract to local union officials and members than the Ford and Stellantis departments.The union declined to comment on these developments.LaDonna Newman, a longtime Ford worker, said about the U.A.W.’s president, Shawn Fain, “I give him a lot of kudos for having the courage to go against the corporations.”Jamie Kelter Davis for The New York TimesRatification could also bring political benefits to President Biden, who waded into the negotiations over the summer and fall, and who risked angering business leaders by increasingly siding with the union’s members.Administration officials were taken aback in August when Mr. Fain called for a 40 percent raise for autoworkers and a four-day workweek. Executives at the Big Three called the White House to ask if Mr. Fain was serious. A senior administration official said Biden aides had reassured them that the union wanted a deal, but acknowledged that the negotiations could go quite differently from the way the automakers were used to.In mid-September, when Mr. Biden was in New York for meetings at the United Nations General Assembly, he joined aides on a video call to make a decision that he and his team had been building toward for weeks: to join autoworkers on a picket line in Detroit. That decision infuriated executives, the administration official said, but the White House saw it as a victory for the president and for workers, by making a clear statement about where Mr. Biden stood in the negotiations.Some autoworkers argued that the union had erred by failing to expand the strike, which eventually included about one-third of the companies’ unionized workers in the United States, even more.LaDonna Newman, another longtime Ford worker who opposed the contract because of its limited gains for veteran workers, said she believed the union could have won more at the bargaining table had it been willing to escalate further.Still, she did not blame Mr. Fain for the outcome. “He walked into a burning building,” Ms. Newman said. “I give him a lot of kudos for having the courage to go against the corporations.”Jim Tankersley More

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    G.M.’s Contract Deal With U.A.W. Faces Surprisingly Stiff Opposition

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    Many longstanding General Motors workers have been voting against the tentative accord, which they feel insufficiently improves retirement benefits.A United Automobile Workers union vote on a tentative contract agreement with General Motors that provides record wage increases has run into unexpectedly strong resistance from veteran workers.Voting at most union locals has been completed and the final result, due as early as Thursday evening, will very likely be decided by a narrow margin. A majority of workers at several large plants in Michigan, Indiana and Tennessee rejected the contract, though union members at a large sport utility plant in Arlington, Texas, voted in favor of it.G.M., Ford Motor and Stellantis agreed to similar contracts with the union after U.A.W. members went on strike at select plants and warehouses. Workers walked off the job at the first three plants on Sept. 15 and stayed on strike for more than 40 days. It was the first time the union has struck all three automakers at the same time, though it did not shut down all of the factories of any company.The agreement appears to be headed for ratification at Ford and Stellantis, the maker of Chrysler, Jeep and Ram vehicles, by comfortable margins, according to running tallies the U.A.W. published online.At G.M., many veteran workers have opposed the contract because they want the company to contribute more money to retirement plans and the cost of health care for retirees.“I’ve heard from some traditional workers who said there wasn’t enough in there for them,” said David Green, director of the U.A.W. Region 2B, which includes Ohio, Indiana and a small part of Michigan. “The post-retirement health care is an issue for some people. For some people, it’s the pension contributions.”Mr. Green himself thinks the contract represents a big victory for union members. “This is the best contract I’ve seen since I started in 1989,” he said. “So I was happy with it.”General Motors declined to comment on the contract vote.The tentative contract raises the top wage by 25 percent, from $32 to more than $40 over four and a half years. The increase is more than the combined wage increases the union has won over the past 22 years, according to U.A.W. officials.Newer hires who are lower on the pay scale will see larger increases that take them to the new top wage. And workers who were recently hired will see their hourly pay double.The agreement also provides for cost-of-living adjustments that will nudge wages higher if inflation persists as well as enhanced company contributions to pensions and retirement plans, more paid time off and the ability to strike if any plant is closed during the term of the contract.The contract negotiations with G.M., Ford and Stellantis were led by the United Automobile Workers president, Shawn Fain, center, who was elected this year.Brittany Greeson for The New York TimesTo be ratified, the agreement must secure a simple majority. More than 46,000 U.A.W. workers work at G.M., although not all of them are likely to turn in ballots. More than 14,000 company employees took part in the targeted strikes.As of Wednesday afternoon, an online vote tally that the union maintains showed that just over 54 percent of the votes were in favor of the contract, but that tally did not include numbers from some big plants.If the tentative agreement is voted down, it would represent a big setback for the U.A.W. president, Shawn Fain, who was elected this year and promised to take a more aggressive approach in the contract talks in hopes of winning significant pay increases and reversing some of the concessions the union accepted in past contracts.He appeared to deliver that in what was widely regarded as a record deal. President Biden, who joined striking workers on the picket line in September at a G.M. site in Belleville, Mich., hailed Mr. Fain’s efforts. The president joined Mr. Fain last week at a plant in Belvidere, Ill., that Stellantis agreed to keep open after halting production this year.“I don’t think it diminishes Shawn Fain’s luster that much because of a close ratification vote,” said Arthur Wheaton, director of labor studies at Cornell University School of Industrial and Labor Relations. “It just means expectations were high, and had he not delivered as much as he did, it wouldn’t have passed.”After the contracts with the three Detroit automakers are ratified, Mr. Fain hopes to try to organize workers at nonunion plants in the South owned by Toyota, Honda and other foreign automakers, and the nonunion plants that Tesla operates in California and Texas.Since the terms of the U.A.W. agreements were announced, some of those companies have increased wages of factory workers. Toyota has told workers that it will raise hourly rates by 9 percent in January. Honda and Hyundai will lift wages 11 percent and 14 percent next year. Hyundai plans to increase wages 25 percent by 2028.“Everybody at those companies should say, ‘Thank you, U.A.W.,’” Mr. Wheaton said. “Those increases wouldn’t have happened without the new U.A.W. contract.” More