The United Auto Workers union has concluded its strikes against the Detroit Three, posting massive wage gains and enhanced benefits across the board.
After more than six weeks of steadily expanding strike action against the Detroit Three — Ford (F) – Get Free Report, General Motors (GM) – Get Free Report and Stellantis (STLA) – Get Free Report — the United Auto Workers union has reached tentative agreements with each of the three automakers. The contracts that finally brought union President Shawn Fain off the picket lines all mirror each other, with 25% wage increases, cost-of-living adjustments, enhanced retirement contributions and other benefits.
Auto workers will receive an 11% pay raise upon ratifying the new contracts, which run slightly longer than normal at four and a half years. The remaining 25% bonuses will be granted over the terms of the contract.
And on the heels of this victory — which Fain said marked the turning of the tide in the war of the American working class — the UAW is losing no time in setting its sights on other, grander goals.
Bloomberg reported Monday that Tesla’s 20,000-worker plant in Fremont, California is currently playing host to a UAW organizing committee. The group, according to a source, is talking to Tesla workers about the value of collective bargaining and has reportedly committed to funding any such campaign.
The UAW did not respond to TheStreet’s request for comment.
This effort to actively expand the UAW’s membership in a threat to Elon Musk and Tesla (TSLA) – Get Free Report comes on the heels of several hints from Fain and the UAW over the past few weeks that organizing Tesla is a long-term goal.
Earlier in October, Fain referred to workers at Tesla and other non-union automakers, including Toyota and Honda, as “the UAW members of the future.”
The UAW doubled down on this perspective in a Monday statement following the conclusion of its strikes against the Detroit Three: “When we return to the bargaining table in 2028, it won’t just be with the Big Three, but with the Big Five or Big Six.”
Tesla’s murky union history
Tesla and Musk have been staunchly anti-union for a long time.
Musk criticized the demands of the UAW as a “sure way to drive GM, Ford and Chrysler bankrupt in the fast lane” not long after the strikes started in September.
And in 2022, the billionaire wrote in a tweet that a “union is just another corporation. Far better for many companies to compete for your skills, so that you have maximum optionality.”
But Musk’s anti-union standpoint has, on several occasions, made its way outside of his Twitter feed and into real life. Tesla in February fired a group of employees from one of its New York factories days after they attempted to unionize at the plant, Tesla Workers United claimed.
Tesla claimed in response that the employees were fired as a result of regular performance reviews, calling the impression that they fired workers in relation to the unionization effort a “false allegation.”
In March, a Federal appeals court found that Tesla illegally fired an employee involved in unionization efforts in 2017. The court additionally found a tweet by Musk that threatened unionized workers’ stock options to be illegal and ordered him to delete it, something he has not done.
“Nothing stopping Tesla team at our car plant from voting union,” he wrote. “But why pay union dues & give up stock options for nothing?”
Tesla did not return TheStreet’s request for comment regarding unionization efforts at its plants.
Key analyst breaks down what might happen next
Deepwater Management’s Gene Munster, responding to the reports of the UAW’s efforts at Tesla, said it is clear that the UAW is “immediately trying to capitalize on their success with the Big Three.”
Munster, saying that this could take several months to “sort out,” thinks that the most likely situation is that Tesla workers vote down the UAW and get a pay raise for staying non-union. Munster pegged such a raise at 20%, compared to the 25% the UAW won in its recent contract.
“Bottom line is the workers have the upper hand, and margins for the Big Three are going lower,” he wrote.
Shares of Tesla closed down the previous session nearly 5%, dipping further in after-hours trading.
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