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    U.A.W. Widens Strikes at G.M. and Stellantis, but Cites Progress in Ford Talks

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    The union designated 38 spare-parts distribution centers as additional strike targets at General Motors and Stellantis.The United Automobile Workers union on Friday significantly raised the pressure on General Motors and Stellantis, the parent of Jeep and Ram, by expanding its strike against the companies to include all the spare-parts distribution centers of the two companies.By widening the strike to the distribution centers, which supply parts to dealerships for repairs, the union is effectively taking its case to consumers, some of whom might find it difficult or impossible to have their cars and trucks fixed. The strategy could pressure the automakers to make more concessions to the union, but it could backfire on the union by frustrating car owners and turning them against the U.A.W.Shawn Fain, the union’s president, said Friday that workers at 38 distribution centers at the two companies would walk off the job. He said talks with two companies had not progressed significantly, contrasting them with Ford Motor, which he said had done more to meet the union’s demands.“We will shut down parts distribution centers until those two companies come to their senses and come to the bargaining table,” Mr. Fain said.Where Autoworkers Are Walking Out More

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    U.S. Issues Final Rules to Keep Chip Funds Out of China

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    The rules, which aim to prevent chip makers from using new U.S. subsidies to benefit China, take into account the industry’s perspective.The Biden administration on Friday issued final rules that would prohibit chip companies vying for a new infusion of federal cash from carrying out certain business expansions, partnerships and research in China, in what it described as an effort to protect United States national security.The regulations come as the Biden administration prepares to disburse more than $52 billion in federal grants and tens of billions of dollars of tax credits to build up the U.S. chip industry. The new rules aim to prevent chip makers that benefit from U.S. grants from passing technology, business know-how or other benefits to China.The final restrictions will prohibit firms that receive federal money from using it to construct chip factories outside the United States. They also restrict companies from significantly expanding semiconductor manufacturing in “foreign countries of concern” — defined as China, Iran, Russia and North Korea — for 10 years after receiving an award, the administration said.The rules also prevent companies that receive funding from carrying out certain joint research projects in those countries, or licensing technology that would raise national security concerns to those countries.If a company violated those guardrails, the Commerce Department said, the government could claw back the firm’s entire award.“These guardrails will protect our national security and help the United States stay ahead for decades to come,” Gina M. Raimondo, the secretary of commerce, said in a statement.The restrictions have been the subject of heavy lobbying from the chip industry, which collectively earns about one-third of its revenue from China. Chip makers in comments filed this year expressed concerns that overly restrictive measures could disrupt supply chains and hamper their global competitiveness.Many of the rule’s broad principles, like the 10-year limit on new investments in China, were outlined in the bipartisan legislation that authorized funding for the sector. But Commerce Department officials were responsible for writing the detailed provisions of the rule.In its final rules issued Friday, the department appeared to take the perspective of chip makers and others into account. A comparison of the restrictions showed that the department had made several changes supported by chip makers, such as abolishing a specific dollar threshold for transactions that would expand chip companies’ manufacturing capacity in China, Russia, North Korea or Iran. Under the proposed rule in March, the Commerce Department would have reviewed any transaction that expanded a company’s semiconductor manufacturing capacity in such a “country of concern” valued at more than $100,000.But companies like Taiwan Semiconductor Manufacturing Company suggested that it would be more pragmatic for the department to monitor the physical expansion of the footprint of semiconductor factories, a standard that the commerce department adopted.It remains to be seen if any of the changes will prompt a backlash from Republicans on Capitol Hill, who have criticized the Biden administration as not being tough enough on Beijing and condemned a recent set of trips to China by top administration officials.In an interview on Friday, Commerce Department officials said that they had received various requests from the industry to relax certain guidelines, but that they had maintained or even strengthened some provisions where necessary to protect national security.One official added that the national security goal of the program was to have companies operating in the United States and doing so successfully, and that the department aimed to work with companies to ensure they were executing on U.S. grants.“My sense is that they struck a reasonable balance between trying to be restrictive but also not trying to be draconian with the impact on existing facilities in China,” said Chris Miller, the author of “Chip War” and an associate professor of international history at the Fletcher School at Tufts University. More

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    Ford Averts Auto Strike in Canada as UAW Talks in U.S. Inch Along

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    The United Auto Workers union is threatening to expand strikes on Friday if it does not make significant progress in talks with General Motors, Ford and Stellantis.Negotiations between each of the three large U.S. automakers and the United Auto Workers union remain far from being resolved, but one of the companies — Ford Motor — has averted a second strike in Canada.Late on Tuesday, the company reached a tentative labor agreement with Unifor, Canada’s main auto union. The deal was announced minutes before an 11:59 p.m. deadline set by the union for a strike by its 5,600 members at Ford.Neither side disclosed the terms of the agreement, but Unifor said the company had made a “substantive offer.”“We believe that this agreement will solidify the foundations on which we will continue to bargain gains for generations of autoworkers in Canada,” Unifor’s national president, Lana Payne, said in a statement.Unifor’s talks with Ford, General Motors and Stellantis, which owns Chrysler, Jeep and Ram, started on Aug. 10 but have been overshadowed by the U.A.W. contract talks in the United States.Ford has an assembly plant and two engine plants in Canada. Unifor selected Ford as the “target” of its talks, meaning it focused on securing the best deal it could from the company before turning to the other two automakers. Now, it will seek to strike similar agreements with G.M. and Stellantis.Ford’s deal in Canada appears to have little bearing on the U.A.W. strikes in the United States.Last Thursday, the U.A.W. told nearly 13,000 workers to leave their jobs at three U.S. plants: a G.M. pickup truck factory in Wentzville, Mo.; a Ford truck and sport utility vehicle plant in Wayne, Mich.; and a Stellantis S.U.V. plant in Toledo, Ohio.The talks appear to have progressed only a little since the strikes began on Friday. On Wednesday, the U.A.W. said it was reviewing a new offer from Stellantis but declined to provide details.Josh Boyd, with his daughter, is an auto mechanic at the headquarters’ technical center. He said he was ready to walk out if asked by the union.Nick Hagen for The New York TimesThe union is seeking a 40 percent increase in wages over four years, saying the pay of the automakers’ chief executives rose by roughly that much over the previous four years. The companies have offered raises of just over 20 percent.The U.S. union also wants more workers to qualify for pension plans, company-paid health care for retirees, shorter working hours and other improvements. And the U.A.W. is seeking an end to a practice under which new hires are paid about $17 an hour — a bit more than half the top union wage of $32 an hour.At $32 an hour, a U.A.W. member working 40 hours a week is paid about $67,000 a year. In recent years, the companies have paid workers profit-sharing bonuses of $9,000 to $15,000.Outside Stellantis’s North American headquarters in Auburn Hills, Mich., on Wednesday, workers who are not on strike picketed in support of the work stoppage, chanting, “No justice, no Jeeps.”Josh Boyd, 36, an auto mechanic who works at the headquarters’ technical center, said he was ready to walk out if asked by the union. “There’s always uncertainty, but there’s also excitement,” he said. “I think we’re going to get a good contract.”Mr. Boyd, who carried his young daughter on his shoulder, said that he earned $32 an hour, but that his family of three was stretched. “Day care is $250 a week,” he said. “I’ve got a mortgage. My wife is in school, so we are on one income.”LaShawn English, a regional U.A.W. director, said the wage increases offered by the automakers would apply to most but not all workers.Nick Hagen for The New York TimesLaShawn English, who was elected this year as the director of the U.A.W.’s Region 1, which includes parts of Michigan and Canada, said the wage increases offered by the automakers would apply to most but not all workers. Among those who would not get the same raises are temporary workers who make up about 12 percent of Stellantis’s unionized work force of 43,000.“It’s not just about the higher-wage workers,” she said. “We have to move everybody forward. We can’t leave people behind.”Earlier on Wednesday, Stellantis presented a new offer to the union but did not disclose details other than to say it primarily addressed issues other than wages. The company also said it had to lay off 68 workers at a machining plant in Ohio, and might have to lay off 300 more in Indiana because of the U.A.W.’s strike at its Toledo plant, which makes Jeeps.On Tuesday, the U.A.W. president, Shawn Fain, said the union might expand the strike to additional plants this week if it did not make significant progress toward an agreement. Mr. Fain is expected to announce additional strike locations Friday morning with workers leaving their jobs at noon.In the past, the U.A.W. typically struck at all locations of one automaker at a time. Mr. Fain was elected president of the union this year on promises to take a more combative approach. His unusual strike strategy, frequent media appearances and strident criticisms of management appear to have caught the automakers off guard.On Friday, Mr. Fain appeared at a rally of several hundred workers in Detroit along with Senator Bernie Sanders, the Vermont independent.On Wednesday, G.M.’s second-highest-ranking executive, its president, Mark Reuss, sought to rebut Mr. Fain’s criticisms in an opinion essay in The Detroit Free Press.He said G.M. had offered to increase wages 20 percent over the next four years, which would lift the top wage to more than $39 an hour, or about $82,000 a year, based on a 40-hour workweek. Entry-level workers now earning $17 an hour would reach $39 an hour after four years.“U.A.W. leadership claims G.M. pays its team members ‘poverty’ wages,’” Mr. Reuss wrote. “This is simply not true.”While G.M. is making near-record profits — it made almost $10 billion in 2022 — Mr. Reuss said the company was investing heavily to make the transition to electric vehicles, including $11 billion this year. He added that the company could not afford to pay what the U.A.W. was seeking if it wanted to remain competitive and healthy.“The fundamental reality is that the U.A.W.’s demands can be described in one word — untenable,” he wrote, adding, “As the past has clearly shown, nobody wins in a strike.”Separately, the U.A.W. said on Wednesday that 190 union members went on strike at a Tuscaloosa, Ala., plant owned by ZF, a company that supplies axles to Mercedes-Benz. More

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    Defense Department Awards Chip Funding to Fuel Domestic Research

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    The $238 million in grants will set up eight research hubs, as a small slice of the federal money that will go to chip companies and research facilities in the coming months.The Biden administration on Wednesday announced that it was awarding $238 million through the Defense Department to set up eight hubs around the United States for promoting innovation in the semiconductor industry.The funds are one of the earliest releases of the nearly $53 billion in grants and subsidies that Congress and the Biden administration have approved to build up the domestic semiconductor industry, which U.S. officials say has been left vulnerable by decades of offshoring.The Biden administration has a variety of funding programs in the works to encourage chip research institutions and manufacturers to set up operations in the United States. Most of these programs are run through the Commerce Department, and many will begin handing out money this fall.While U.S. companies still design many of the world’s most advanced chips, much of the manufacturing of the technology has been outsourced to foreign locations, including Taiwan, leaving U.S. chip supply vulnerable if, for example, the Chinese government were to invade Taiwan.The awards announced Wednesday will go to research institutes, consortiums and universities located in New York, Arizona, Indiana, Ohio, California, North Carolina and Massachusetts, defense officials said.Each hub will receive $15 million to $40 million to fund the development of new chips for use in electromagnetic warfare, artificial intelligence, 5G and 6G wireless technologies, and quantum computing, among other areas. While the research will be directed at meeting the needs of the Defense Department, it is also expected to be useful for commercial applications.Kathleen Hicks, the deputy defense secretary, said in a news conference Wednesday that the hubs would “tackle many technical challenges relevant to D.O.D.’s missions, to get the most cutting-edge microchips into systems our troops use every day: ships, planes, tanks, long-range munitions, communications gear, sensors and much more.”The funding also aims to accelerate what the industry refers to as the “lab-to-fab transition,” the process of taking new chip technologies and turning them into viable commercial products.David A. Honey, the deputy under secretary of defense for research and engineering, said the hubs would bring more prototype work to the United States.“Now we’ll be able to get it done here,” he said. “And also we’re building out in the areas that are just not available anywhere else.”The Commerce Department is separately setting up a string of research hubs for the semiconductor industry, collectively called the National Semiconductor Technology Center, drawing on $11 billion in funding it received for research and development.Appearing before the House Science, Space and Technology Committee on Tuesday, Gina Raimondo, the commerce secretary, said that her department was on track to formally unveil that technology center this fall.She also said that the department had received about 100 applications from companies hoping to receive grants that will be available to manufacturers.While Ms. Raimondo acknowledged that the grant program faced challenges, like securing enough workers to staff new chip plants, she said that if properly implemented, the program would make the United States “the premier destination in the world” for chip design, research and manufacturing.“That’s the vision that we’re trying to achieve with your support,” Ms. Raimondo told lawmakers.Ms. Raimondo was also questioned about the release in prior weeks of an advanced smartphone by Chinese telecom giant Huawei. The company is under heavy U.S. trade restrictions, administered by the Commerce Department, that theoretically should have prevented such an innovation.Ms. Raimondo said that she was upset by the development, but added that the U.S. government did not have any evidence that Chinese companies could manufacture the more sophisticated chips at scale.Ms. Raimondo said that the United States could take various defensive measures to limit China’s access to advanced technology, but “my strongly held view is that what we do on offense matters so much more.”“The reality is that over the past 30 years, this country has taken its eye off the ball of manufacturing,” she continued. “And when you don’t manufacture you lose out on innovation, and you become dependent on other countries.” More

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    U.A.W. Threatens Strikes at More Plants

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    The United Auto Workers union said workers would walk out of more plants on Friday if it didn’t make progress in talks with General Motors, Ford and Stellantis.The United Auto Workers said on Tuesday that the union would expand its strike against three U.S. automakers on Friday if it was unable to make substantial progress in contract talks with them.Nearly 13,000 U.A.W. members walked off the assembly lines at three plants last Friday, one each at the three companies — General Motors, Ford Motor and Stellantis, the parent of Chrysler. The union has demanded a 40 percent wage increase over four years, better benefits and other changes. The automakers, which are based in or have a big presence in Michigan, have offered raises of about half as much.In a video posted on Facebook on Tuesday, the union’s new president, Shawn Fain, said workers could walk out of more plants at the end of this week.“If we don’t see serious progress to noon Friday, Sept. 22, more locals will be called on to stand up and go on strike,” he said. “We’re going to keep hitting the companies where we need to.”Separately on Tuesday, Mr. Fain responded to criticism by former President Donald J. Trump, who is expected to visit the Detroit area next week.“Every fiber of our union is being poured into fighting the billionaire class and an economy that enriched people like Donald Trump at the expense of workers,” Mr. Fain said. “We can’t keep electing billionaires and millionaires that don’t have any understanding of what it is like to live paycheck to paycheck and struggle to get by and expecting them to solve the problems of the working class.”In an interview on NBC’s “Meet the Press” last weekend, Mr. Trump said Mr. Fain and the union were “failing” workers in the shift to electric vehicles that has been championed by President Biden.“The autoworkers are being sold down the river by their leadership,” he said, adding: “All of these cars are going to be made in China. The electric cars, automatically, are going to be made in China.”Mr. Biden has expressed support for the striking workers, although the U.A.W. has not endorsed his re-election thus far. The union has long backed Democratic presidential candidates, but some of its members supported Mr. Trump in the last two elections.Here Are the Plants Where U.A.W. Strikes Are HappeningSee the plants owned by Ford, General Motors and Stellantis where U.A.W. members are on strike.The union and the companies, which are engaged in three separate negotiations, remain far apart. The companies have offered raises of about 20 percent, but Mr. Fain has said that doesn’t go far enough to make up for the impact of inflation and concessions the union made over the last 15 years.The union also wants pensions to cover more workers, company-paid health care for retirees, shorter working hours and measures that make it harder for the companies to close plants in the United States. The automakers have rejected most of those other demands.In statements and interviews, auto executives have said meeting all of the union’s demands would put them at a severe competitive disadvantage to nonunion plants operated by Tesla and foreign automakers such as Toyota and Volkswagen. G.M., Ford and Stellantis already have higher labor costs than most nonunion car companies.The three automakers have said they cannot afford substantial raises and new benefits because they are investing tens of billions of dollars to develop electric vehicles and build battery plants. More

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    Strike Is a High-Stakes Gamble for Autoworkers and the Labor Movement

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    Experts on unions and the industry said the U.A.W. strike could accelerate a wave of worker actions, or stifle labor’s recent momentum.Since the start of the pandemic, labor unions have enjoyed something of a renaissance. They have made inroads into previously nonunion companies like Starbucks and Amazon, and won unusually strong contracts for hundreds of thousands of workers. Last year, public approval for unions reached its highest level since the Lyndon Johnson presidency.What unions haven’t had during that stretch is a true gut-check moment on a national scale. Strikes by railroad workers and UPS employees, which had the potential to rattle the U.S. economy, were averted at the last minute. The fallout from the continuing writers’ and actors’ strikes has been heavily concentrated in Southern California.The strike by the United Automobile Workers, whose members walked off the job at three plants on Friday, is shaping up to be such a test. A contract with substantial wage increases and other concessions from the three automakers could announce organized labor as an economic force to be reckoned with and accelerate a recent wave of organizing.But there are also real pitfalls. A prolonged strike could undermine the three established U.S. automakers — General Motors, Ford and Stellantis, which owns Chrysler, Jeep and Ram — and send the politically crucial Midwest into recession. If the union is seen as overreaching, or if it settles for a weak deal after a costly stoppage, public support could sour.“Right now, unions are cool,” said Michael Lotito, a lawyer at Littler Mendelson, a firm representing management.“But unions have a risk of not being very cool if you have five-month strike in L.A and an X-month strike in how many other states,” he added.If the stakes seem high for the U.A.W., that’s partly because the union’s new president, Shawn Fain, has gone out of his way to elevate them. During frequent video meetings with members before the strike, Mr. Fain has portrayed the negotiations as a broader struggle pitting ordinary workers against corporate titans.“I know that we’re on the right side in this battle,” he said in a recent video appearance. “It’s a battle of the working class against the rich, the haves versus the have-nots, the billionaire class against everybody else.”Mr. Fain’s framing of the contract campaign in class terms appears to be resonating with his members, thousands of whom have watched the online sessions.Shunte Sanders-Beasley, a U.A.W. member said, “If we can win back some of the concessions we took, I’m hoping that it’ll be a trickle-down effect.”Cydni Elledge for The New York TimesShunte Sanders-Beasley, a U.A.W. member in Michigan who started working at a Chrysler plant in Indiana in 1999, said she saw the fight similarly.“If you follow history, autoworkers tend to set the tone,” said Ms. Sanders-Beasley, who has served as vice president of her local and backed Mr. Fain’s campaign for the union’s presidency last year. “If we can win back some of the concessions we took, I’m hoping that it’ll be a trickle-down effect.”A successful autoworker strike in 1937, which led G.M. to recognize the U.A.W. for the first time, helped set in motion a wave of union organizing across a variety of industries like steel, oil, textiles and newspapers over the next few years.Labor activists agreed that the current strike could also reverberate across other industries, where workers appear to be paying close attention to the labor actions of the past year. “In organizing meetings, they say, ‘If they can do it, we can do it,’” said Jaz Brisack, an organizer with Workers United who had played a key role in the Starbucks campaign.But the flip side is that the strike could inflict collateral damage that creates frustration and hardship among tens of thousands of nonunion workers and their communities.“The small and medium-sized manufacturers across the country that make up the automotive sector’s integrated supply chain will feel the brunt of this work stoppage, whether they are a union shop or not,” Jay Timmons, the chief executive of the National Association of Manufacturers, said in a statement Friday.Higher wages and gains for rank-and-file workers can be good for the economy. But some argue that Mr. Fain’s and other labor leaders’ aggressive demands could discourage businesses from investing in the United States or render them uncompetitive with foreign rivals.“Mr. Fain has to think about this, too — the long-term financial viability of these three companies,” said John Drake, vice president of transportation, infrastructure and supply chain policy at the U.S. Chamber of Commerce.Even those who welcome the union’s aggressive stance say it is fraught with risk. Gene Bruskin, a longtime union official who helped workers at a Smithfield meat-processing plant in North Carolina achieve, in 2008, one of the biggest organizing victories in decades, said a long strike could disillusion workers if the union came up short on key demands.“If the U.A.W. fails to make any significant gains, particularly on the two-tier stuff, their future could be seriously harmed,” said Mr. Bruskin, referring to a system in which newer workers are paid far less than veteran workers who perform similar jobs.Mr. Bruskin also worried that the union could effectively win the battle and lose the war if the auto companies respond by shifting more production to Mexico, where they already have a significant presence. Shawn Fain, president of the U.A.W., said, “It’s a battle of the working class against the rich, the haves versus the have-nots, the billionaire class against everybody else.”Cydni Elledge for The New York TimesThe tens of billions of dollars in federal subsidies for domestic production of electric vehicles that President Biden has helped secure should limit that shift and help keep manufacturing jobs at home. Many automakers are already locating new plants in the United States to take advantage of the funds.Still, Willy Shih, an expert on manufacturing at Harvard Business School, said the automakers could adjust their operations in ways that undercut the U.A.W. while continuing to produce cars domestically. Automation is one option, he said, as is locating new plants in lightly unionized Southern states.The Detroit automakers have created joint ventures with foreign battery makers outside the reach of the U.A.W.’s national contracts and have sought to locate some of those plants in states like Tennessee and Kentucky. The union is seeking to bring workers at those plants up to the same pay and labor standards that direct employees of the Big Three enjoy, but it has not succeeded so far.Given those threats, the union may feel justified in taking a more ambitious posture toward the automakers. The primary check on shifting work to other states will be the U.A.W.’s ability to organize new plants, especially in the South, where it has struggled to gain traction for years. Experts argued that the union would likely increase its chances of attracting members there if it could point to large concrete gains.“The answer is winning a strong contact here and using it to organize huge groups of autoworkers who are currently nonunion,” said Barry Eidlin, a sociologist at McGill University in Montreal who studies labor.And there are other ways in which being too cautious may be a bigger risk to the union than being too aggressive. Organizers point out that workers are often demoralized when union leaders talk tough and then quickly settle for a subpar deal.Critics of the previous U.A.W. administration accused it of doing just that before Mr. Fain took over this year. “We’d be trying to make sense of how certain things passed in the first place,” Shana Shaw, another longtime U.A.W. member who backed Mr. Fain, said of the concessionary contracts autoworkers were asked to accept over the years.Even Mr. Fain’s habit of framing the fight in broad class terms may prove to be a strategic advantage. A recent Gallup poll found that 75 percent of the public backed the autoworkers in the showdown, compared with 19 percent who were more sympathetic to the companies.The widespread public support suggests that the autoworkers may be operating in a different context from workers in another strike that famously contributed to a loss of power for labor: air traffic controllers’ unsuccessful fight against the Reagan administration in the early 1980s, after which private-sector employers appeared to become more comfortable firing and replacing striking employees.Dr. Eidlin said that while the air traffic controllers failed to court allies in the labor movement, “the fact that Fain and the U.A.W. are messaging more broadly, really trying to build that broad coalition, speaks to the possibility of a different outcome.” More

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    Battle Over Electric Vehicles Is Central to Auto Strike

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    Carmakers are anxious to keep costs down as they ramp up electric vehicle manufacturing, while striking workers want to preserve jobs as the industry shifts to batteries.A battle between Detroit carmakers and the United Auto Workers union, which escalated on Friday with targeted strikes in three locations, is unfolding amid a once-in-a-century technological upheaval that poses huge risks for both the companies and the union.The strike has come as the traditional automakers invest billions to develop electric vehicles while still making most of their money from gasoline-driven cars. The negotiations will determine the balance of power between workers and management, possibly for years to come. That makes the strike as much a struggle for the industry’s future as it is about wages, benefits and working conditions.The established carmakers — General Motors, Ford Motor and Stellantis, which owns Chrysler, Jeep and Ram — are trying to defend their profits and their place in the market in the face of stiff competition from Tesla and foreign automakers. Some executives and analysts have characterized what is happening in the industry as the biggest technological transformation since Henry Ford’s moving assembly line started up at the beginning of the 20th century.Nearly 13,000 U.A.W. workers walked off the job at three plants in Ohio, Michigan and Missouri on Friday after talks between the unions and the companies in three separate negotiations failed to result in agreements before a Thursday deadline. Pay is one of the biggest sticking points: The union is demanding a 40 percent pay increase over four years but the automakers have offered roughly half as much.But the talks are about more than pay. Workers are trying to defend jobs as manufacturing shifts from internal combustion engines to batteries. Because they have fewer parts, electric cars can be made with fewer workers than gasoline vehicles. A favorable outcome for the U.A.W. would also give the union a strong calling card if, as some expect, it then tries to organize employees at Tesla and other nonunion carmakers like Hyundai, which is planning to manufacture electric vehicles at a massive new factory in Georgia.“The transition to E.V.s is dominating every bit of this discussion,” said John Casesa, senior managing director at the investment firm Guggenheim Partners who previously headed strategy at Ford Motor.“It’s unspoken,” Mr. Casesa added. “But really, it’s all about positioning the union to have a central role in the new electric industry.”Under pressure from government officials and changing consumer demand, Ford, G.M. and Stellantis are investing billions to retool their sprawling operations to build electric vehicles, which are critical to addressing climate change. But they are making little if any profit on those vehicles while Tesla, which dominates electric car sales, is profitable and growing fast.Ford said in July that its electric vehicle business would lose $4.5 billion this year. If the union got all the increases in pay, pensions and other benefits it is seeking, the company said, its workers’ total compensation would be twice as much as Tesla’s employees.Union demands would force Ford to scrap its investments in electric vehicles, Jim Farley, the company’s chief executive, said in an interview on Friday. “We want to actually have a conversation about a sustainable future,” he said, “not one that forces us to choose between going out of business and rewarding our workers.”Attendees at the Detroit Auto Show looking at a 2024 Chevy Silverado EV in Detroit this past week. Talk of the autoworkers’ strike loomed over the show.Brittany Greeson for The New York TimesFor workers, the biggest concern is that electric vehicles have far fewer parts than gasoline models and will render many jobs obsolete. Plants that make mufflers, catalytic converters, fuel injectors and other components that electric cars don’t need will have to be overhauled or shut down.Many new battery and electric vehicle factories are springing up and could employ workers from the plants that have shut down. But automakers are building most aggressively in the South where labor laws are tilted against union organizers, rather than in the Midwest, where the U.A.W. has more clout. One of the union’s demands is that workers in the new factories be covered by the automakers’ national labor contracts — a demand that the automakers have said they can’t meet because those plants are owned by joint ventures. The union also wants to regain the right to strike to block plant shutdowns.“We are at the dawn of another industrial revolution and the way we’re going is the way we went in the last industrial revolution — a lot of profit for a few and misery and not good jobs for the many,” said Madeline Janis, executive director of Jobs to Move America, an advocacy group that works closely with the U.A.W. and other unions.“The U.A.W. is really taking a stand for communities across the country to make sure this transition benefits everybody,” Ms. Janis added.Automakers have been racking up record profits during the last decade, but they cannot afford to lose time from work stoppages in their race to compete with Tesla and foreign automakers.The three companies are already struggling to get their electric vehicle business going. A new G.M. battery factory in Ohio has been slow to produce batteries, delaying electric versions of the Chevrolet Silverado pickup and other vehicles. Ford this year had to suspend production of its electric F-150 Lightning in February after a battery caught fire in one of the pickups that was parked near the factory for a quality check. And Stellantis won’t even begin selling any fully electric vehicles in the United States until next year.Those problems and Tesla’s growing sales could put the union in a strong position to extract a good deal.On Thursday, in a sign that automakers are willing to go much further than they had previously, G.M. offered a 20 percent pay raise over four years. That is half of what the union is seeking but far more than workers received in recent contracts. President Biden on Friday strongly supported the union in remarks at the White House. The administration has been pouring billions into programs to promote electric vehicles and does not want a strike to delay a centerpiece of its climate policy.Despite all the money that automakers have made in recent years, their executives express a profound unease about the growth of electric vehicles, which account for 7 percent of the U.S. new car market so far this year and are on track to surpass sales of one million this year. Managers are acutely aware that traditional companies like theirs have a poor track record of retaining dominance after a big change in technology. Witness the way that Apple sidelined Nokia and Motorola as cellphones became smartphones.Auto company executives and most industry analysts underestimated how quickly electric vehicles would catch on and cannot confidently forecast how sales, which have been bumpy lately, will grow in the future. “I don’t think anyone can perfectly predict what the adoption will be,” Mary T. Barra, the chief executive of General Motors, said in an interview with The New York Times last month.Speaking to “CBS Mornings” on Friday, Ms. Barra said an excessive pay raise would undermine G.M.’s ability to continue producing vehicles with internal combustion engines while also developing electric vehicles. “This is a critical juncture where investing is very important,” she said.Still, unions and their supporters are unlikely to express much sympathy for auto executives. Ms. Barra and the leaders of Ford (Jim Farley) and Stellantis (Carlos Tavares) have gotten tens of millions of dollars in compensation packages in recent years. The companies’ shareholders have been rewarded with dividends and share buybacks.Unions “are not going to have a lot of patience for sob stories,” said Karl Brauer, executive analyst at iSeeCars.com, an online marketplace.Adjusted for inflation, wages for autoworkers in the United States have fallen 19 percent since 2008, according to the Economic Policy Institute, a left-leaning research group.At the same time, union officials are aware of the changes in the industry and have said they do not want to handicap G.M., Ford and Stellantis as the companies try to recover ground they have lost to Tesla, which has aggressively resisted attempts to unionize its factories. The Detroit carmakers also face challengers like Rivian, a start-up that makes electric pickup trucks and sport utility vehicles in Illinois, as well as foreign-owned rivals like Mercedes-Benz and Toyota, whose U.S. factories, mostly in the South, are not unionized.“That’s the biggest challenge here,” Mr. Brauer added, “trying to commit to a long-term contract in an industry that is very uncertain and unpredictable over the next five years.”Union supporters say it would be wrong to blame workers if the traditional carmakers cannot compete with Tesla and other rivals.“If you look at the breakdown at what it costs to build an E.V., labor is a very small part of the equation. Batteries are the most,” Ms. Janis of Jobs to Move America said. “This idea that the U.A.W. is going to price Ford, G.M. and Stellantis out of the market is not true.”But other analysts said that a long work stoppage could help Tesla and foreign automakers gain ground on G.M., Ford and Stellantis.“If something happens to disrupt their business, does that give a leg up to the emerging electric vehicle makers?” said Steve Patton, who overseas the consulting firm EY’s work with auto companies. “Who stands to benefit if there is a protracted strike?” More

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    U.A.W. Starts Strike Small, but Repercussions Could Prove Far-Reaching

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    Autoworkers walked off the job on Friday at three factories that produce some of the Detroit carmakers’ most popular vehicles, the opening salvos in what could become a protracted strike that hurts the U.S. economy and has an impact on the 2024 presidential election.Nearly 13,000 members of the United Auto Workers at plants in Ohio, Michigan and Missouri joined early Friday in what the union described as a targeted strike that could expand to more plants if its demands for pay raises of up to 40 percent and other gains were not met.The union’s four-year contracts with three automakers — General Motors, Ford Motor and Stellantis, which owns Chrysler, Jeep and Ram — expired Thursday, and the companies and the union remained far from striking new deals.The U.A.W.’s president, Shawn Fain, used sweeping language on Thursday to describe why his members were going on strike against all three automakers at the same time — something the union had never done in its nearly 90-year history.“This is our generation’s defining moment,” Mr. Fain, the union’s first leader elected directly by members, said in an online video. “The money is there, the cause is righteous, the world is watching, and the U.A.W. is ready to stand up.”The union and the companies did not negotiate on Friday, but the U.A.W. said it planned to resume bargaining on Saturday. President Biden dispatched two senior administration officials to Detroit on Friday to encourage the companies and union to reach agreements.At a Ford plant in Wayne, Mich., west of Detroit, strikers waved placards — one read, “Record Profits; Record Contracts” — and gave thumbs-up to honking vehicles. A metal sign on a chain-link fence read, “Absolutely NO foreign cars allowed.” The protesters were assigned to a six-hour shift on the picket line. If the strike continues, they will be called to one shift per week.While first and foremost a battle between autoworkers and automakers, the conflict could have far-reaching consequences. A lengthy strike would reduce the number of new cars available for sale, which could fuel inflation and force the Federal Reserve to keep interest rates high.The U.A.W.’s president, Shawn Fain, center, at the walkout early Friday at Ford Motor’s assembly plant in Wayne, Mich.Cydni Elledge for The New York TimesA strike also presents a quandary for Mr. Biden, who has called for rising incomes but must also be mindful of the strike’s economic impact and his goal to promote electric vehicles as a solution to climate change.Speaking at the White House on Friday, the president strongly supported the union. “Over the past decade, auto companies have seen record profits, including in the last few years, because of the extraordinary skill and sacrifices of U.A.W. workers,” he said. “But those record profits have not been shared fairly.”The U.A.W. says its pay demands roughly correspond to the increases in the compensation of the top executives at Ford, G.M. and Stellantis. The raises are also meant to help compensate workers for the ground they have lost to inflation and big concessions the union made to the automakers after the 2007-8 financial crisis, when G.M. and Chrysler were forced to restructure themselves in bankruptcy court.But auto executives say they already pay production workers substantially more than rivals, like Tesla and Toyota, whose U.S. workers are not unionized. The companies also contend that such big raises would undermine their efforts to develop electric vehicles and remain relevant as the industry makes a difficult and costly shift from gasoline cars and trucks to electric vehicles.If unions got all that they were asking for, “we would have to cancel our E.V. investments,” Jim Farley, the chief executive of Ford, said in an interview on Friday. Instead, Ford would need to concentrate on large sport utility vehicles and pickups that generate the most profit, he said.Ford, which employs the most union members, reported a profit of $1.9 billion in the second quarter, equal to 4 percent of its sales. Tesla made $2.7 billion in the same period, about 11 percent of its sales.Mr. Farley sounded pessimistic about the chances of agreeing on a contract soon. “They are not negotiating in good faith if they are proposing deals that they know are going to crater our investments,” he said.Mr. Fain’s decision to shut down just three factories is a departure for the union, which in previous strikes typically walked out of all the factories of a single automaker. By interrupting production of some of the most profitable vehicles, while allowing most plants to keep operating, the union hopes to inflict pain on the carmakers while allowing most of its members to continue collecting paychecks.But it may be difficult for the union to limit the damage to its members’ incomes. Ford told workers at a facility in Michigan, who were not on strike, to stay home Friday because of parts shortages caused by the strike. G.M. said it would probably lay off 2,000 workers at a factory in Kansas next week because of a lack of parts produced at the factory near St. Louis that is on strike.Fewer than 10 percent of the nearly 150,000 U.A.W. members at the three companies are on strike. Limited strikes could allow the union to maintain the pressure longer by preserving its strike fund of $825 million. The union will pay striking workers $500 a week and cover their health insurance premiums.Automakers have been earning record profits “because of the extraordinary skill and sacrifices of U.A.W. workers,” President Biden said at the White House on Friday.Anna Rose Layden for The New York TimesIn addition to the Ford plant in Michigan, which makes the Bronco and the Ranger pickup truck, and the G.M. plant in Wentzville, Mo., which makes the GMC Canyon and the Chevrolet Colorado, workers shut down a Stellantis complex in Toledo, Ohio, that makes the Jeep Gladiator and Jeep Wrangler. If no agreement is reached, the union is expected to target additional factories in weeks to come.The union is also seeking cost-of-living adjustments that would protect workers if inflation flares up again. And it wants to reinstate pensions that the union agreed to do away with for newer workers after the financial crisis, improved retiree benefits and shorter work hours. The union also wants to eliminate a wage system that starts new hires at much lower wages than the top U.A.W. pay of $32 an hour.As of Friday last week, the companies had offered to raise pay by around 14.5 percent to 20 percent over four years. Their offers include lump-sum payments to help offset the effects of inflation, and policy changes that would lift the pay of recent hires and temporary workers, who typically earn about a third less than veteran union members.In a last-minute attempt to keep assembly lines running, G.M. offered its employees a 20 percent raise late Thursday and said it was willing to pay cost-of-living adjustments to veteran workers. The 20 percent increase would be far more than employees had received in decades. But the union rejected the offer, which it says would barely compensate for inflation.Autoworkers striking at the G.M. factory in Wentzville, Mo.Neeta Satam for The New York TimesLeaders of the automakers have criticized the U.A.W.’s tactics, focusing on Mr. Fain, who became president in March and declared an end to what he said were overly friendly relations between union leaders and auto executives. He took office after a federal corruption investigation resulted in prison terms for two former U.A.W. presidents.Carlos Tavares, the chief executive of Stellantis, has called Mr. Fain’s strategy “posturing.” Mr. Farley of Ford said the two sides should be negotiating instead of “planning strikes and P.R. events.” And Mary T. Barra, the G.M. chief executive, said that “every negotiation takes on the personality of its leader.”If the autoworkers are successful, they could inspire workers in other industries. Union activism is on the rise: Hollywood screenwriters and actors have been on strike for months, and in August, United Parcel Service employees won their biggest raises ever in a contract negotiated by the International Brotherhood of Teamsters.“Workers have been squeezed for too long and now are realizing they can do something about it,” said Mijin Cha, an assistant professor at the University of California, Santa Cruz, who studies the relationship between labor’s interests and the fight against climate change. “People see there is a pathway to more economic security and workers do have power together.”Late on Friday, at an outdoor rally in downtown Detroit attended by several hundred U.A.W. members, Mr. Fain introduced Senator Bernie Sanders, a Vermont independent, who told the crowd: “The fight you are waging here is not just about decent wages and working conditions and pensions in the auto industry. It’s a fight to take on corporate greed.”The strikes come as auto production is still recovering from the effects of the pandemic, which caused shortages of semiconductors and other components. Car prices and wait times have come down, but dealer inventories remain low and a lengthy strike could eventually make it hard to find popular U.S.-made models.“We’re not back to speed inventory-wise,” said Wes Lutz, the owner of Extreme Dodge, a car dealership in Jackson, Mich.Wes Lutz, the owner of Extreme Dodge in Michigan said, “We’re not back to speed inventory wise.”Brittany Greeson for The New York TimesScarcity is not always bad for carmakers. It allowed them to earn higher profit margins during the pandemic. And it would benefit any carmakers that were having trouble moving some models. Pat Ryan, chief executive of the car-shopping app Co-Pilot, said that Stellantis had at least 100 days of inventory for brands like Dodge and Chrysler, and that a strike could help it clear many dealers’ lots.Still, if prices for popular models rise, that will be yet another speed bump in the Federal Reserve’s road to lowering inflation, and a political liability for Mr. Biden. The president, who has no formal role in the negotiations, said Friday that he had been in touch with union leaders and auto executives, in addition to dispatching the two administration officials to Detroit.Reporting was contributed by More