Local expert says ‘severe, dramatic’ UAW strike more likely than settlement
MID-MICHIGAN (WNEM) - The UAW and the Big Three are still working to negotiate a new contract as the current agreement expires soon, and it appears the two sides are miles apart on a new deal.
“I think we’re more likely to see a strike than a pre-strike settlement,” said Erik Gordon, a professor at the University of Michigan’s Ross School of Business.
Gordon said he is confident a strike between the UAW and the Detroit Three is imminent. He said while most negotiating is usually done in the last week before the contract expires – in this case September 14 – the sides are very far apart.
As TV5 has reported, Ford, GM, and Stellantis have scoffed at UAW proposals calling for a 46 percent raise, restoring traditional pensions, eliminating tiers, and working 32 hours a week while being paid for 40.
“I think this is going to be the most severe and the most dramatic strike in 50 years,” Gordon said.
He said he thinks a work stoppage might last a while.
“In 2019, the strike against GM lasted 40 days, and that was considered to be a long strike. I think this strike could be anywhere from 20 days to 90 days,” he said.
In the past, the UAW has picked one company to strike at, but Gordon said there’s a possibility of a different tactic this time.
“Strike at selected plants, or selected suppliers, including parts suppliers, which could in effect close down the car company’s manufacturing,” he explained.
Gordon said this round of contract talks has been different from the start.
“Traditionally, these negotiations have begun with the ceremonial handshake. President of the UAW shakes hands with the CEO of GM, etc,” he said. “This time around, the president of the UAW said, ‘I’m not even going to shake their hands.’”
If a strike does occur, Gordon said he thinks it could resemble walkouts in the 1950s.
“The strikes were very noisy. The picketers sometimes were quite intimidating. You stayed away from certain areas where there might be picketing. It was rough, tough days,” Gordon said. “I don’t think this will be as rough and tough, but I think it will be just as loud. The business I would like to be in here in Michigan for the next few weeks is the bull horn rental business.”
He said eventually, the strike will end, and he believes the UAW will emerge from the work stoppage with some of what it was looking for.
“It’s a bold set of demands,” he said. “Are they going to get most of them? No. Are they going to get a much better contract? Yes.”
Gordon also spoke about what a strike would mean for the surrounding community.
“If there’s a strike that lasts more than a week or two, it will affect any of us who are unfortunate enough to have to buy a car at this time,” Gordon said.
He said a long work stoppage between the UAW and the Detroit Three would impact consumers looking for a new set of wheels.
“Don’t expect to get much of a discount,” Gordon said. “I think you might expect to see what we saw during COVID where you went to a dealer, and the dealer said, ‘Look, the list price for this car is $30,000, but I’m tacking on another $3,000.’ We might see that again.”
He said a strike will also impact auto parts used for maintenance, so if you need to service your vehicle, time may not be on your side.
“I would say go get it repaired tomorrow. Don’t wait until the week after next,” he said.
Gordon said eventually, a strike will impact more areas of the economy.
“There’ll be fewer people going to restaurants, fewer people buying clothing. It will start to affect more people. And at some point, however justified the strike is, people just get weary of it,” he said.
But he was quick to point out the UAW could lose a lot of its $825 million strike fund, $500 for each member per week, and the Detroit Three will likely lose billions.
“At some point, the car companies won’t be able to take the pain of lost sales,” he said. “And at some point, the striking workers are going to say, ‘Look, $500 a week, that’s less than half of what I was making. Let’s settle. We don’t care how angry you are, president of the union, get this thing settled.’”
Marick Masters, a business professor at Wayne State University, said no one wants a strike to happen.
“Nobody wants a strike because it’s inconvenient for the workers, their communities that they work in, and it has repercussions and it’s not good for the consumers because ultimately somebody’s going to have to pay for this strike,” Masters said.
Masters said the strike would not only affect the economy but both sides of the negotiating table.
“They are vulnerable and they’re not quite as vulnerable as UPS, perhaps, but they are vulnerable and they have to, you know, both sides have to realize that,” Masters said.
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