WYOMING, Mich. (WOOD) — The United Auto Workers is preparing for a potential strike with its contract one month away from expiring.
The General Motors plant in Wyoming was last on strike in 2019 and uncertainty about a new potential strike remains with the UAW’s four-year contract set to expire.
Mike Wall, an auto industry expert with SMP Global Mobility, says there are more challenges to address compared with the last negotiation and the previous strike had an impact.
“There is going to be a very significant disconnect between… what the automakers are looking to get out of this contract and negotiation and what the union has,” Wall said. “It took about 350,000 – 400,000 units out of production in 2019 and that was a complete systemwide strike.”
The new president of the UAW spoke recently on the union’s YouTube page showing the tension increasing in negotiations by throwing a proposal in the trash.
While in the past the UAW has picked one of the Detroit three as the target, it is unclear if a strike might impact all three this time around.
“They already have the highest costs hourly rates. This will certainly magnify that and that’s where the feeling is it’s going to be a challenge to stay competitive,” Wall said.
Paul Isely, an associate dean and economics professor at GVSU, says the sides are fundamentally far apart.
“During the course of this last contract we’ve had a substantial amount of inflation,” Isely said. “There has been a lot of profits over the last few years and the question is how much of that profit should go to labor and how much of that profit should be used to change the business model towards electrical vehicle.”
A strike comparable to the scope of the GM strike in 2019 would cost the state about $1 billion in economic activity, according to Isely.
“This will really start to put a crimp on the ability of the state of Michigan to spend money at the state level because it will affect taxable income,” Isely said.
Wall says a strike would really be difficult on part suppliers who are still trying to get back on their feet after the pandemic.
“It’s been tough to be a supplier these last three years and this is the last thing they need on their docket,” Wall said.
A longer strike would mean delays to many car orders just as manufacturers are starting to make up for supply chain delays.
“If you’ve got an order and you’ve been thinking well I’m good I should get it yet this model year I’ve got a lot of time to roll, well unfortunately a strike could very well derail that,” Wall said.
The UAW contract with all three Detroit automakers will expire at the end of the day on Sept. 14.