GM and Stellantis Match Ford’s Wage Offer, Close to Ending Auto Strike
General Motors (GM) and Stellantis NV have matched Ford Motor’s wage offer of a 25% increase to United Auto Workers (UAW) members, signaling a possible end to the six-week auto strike. Sources familiar with the negotiations state that the GM proposal also includes cost-of-living increases over the more-than-four-year contract. A tentative agreement could be reached imminently as both sides work to finalize the details, including the treatment of temporary workers.
The wage offer by GM was made early Friday morning, and talks resumed later that day. The automaker aims to finalize the deal on Friday, but an official announcement may not come until Sunday, when UAW President Shawn Fain plans to update members on the specifics of the Ford deal.
Following the news, both Stellantis and GM shares saw modest gains in after-hours trading. Meanwhile, Ford shares, which had dropped more than 12% on Friday after the company withdrew its profit forecast due to the strike’s impact, rose slightly in late trading. GM shares fell 4.7% on the day.
Approvals from union leadership and union members are required for any final agreements, a process that could take weeks. Negotiations with both automakers continued on Friday to finalize remaining aspects of the agreements. Fain left the GM meeting to join the Stellantis discussion.
Notably, job security has been a pivotal issue in the Stellantis talks as the company transitions to electric vehicles. Stellantis had upset the union previously by idling a plant in Belvidere, Illinois, and by pushing for increased utilization of lower-paid temporary workers. As part of the current negotiations, Stellantis has proposed reopening the Belvidere facility for a new vehicle and an additional battery plant. The automaker has also suggested creating a parts distribution hub similar to Amazon.com, which would absorb workers from consolidated parts facilities. However, these offers are contingent upon certain conditions and are not guaranteed.
Ford’s recent agreement with the UAW includes converting temporary hires to full-time employees. Ford has fewer temporary workers compared to GM and Stellantis, making it easier for the company to grant them permanent status. Extending this same concession to GM and Stellantis would bring their costs more in line with Ford’s, which are higher than their competitors’.
The UAW strike, which commenced on September 15, grew to involve over 45,000 workers from GM, Ford, and Stellantis at multiple assembly plants and parts-distribution facilities across 22 states. Ford stated that the work stoppage has cost the company $1.3 billion, while GM’s strike expenses have reached $800 million.
Overall, progress in the contract talks between GM, Stellantis, and the UAW signals a potential resolution to the auto strike that has significantly impacted the industry. The matching wage offer from the two automakers aligns with Ford’s proposal and brings hope for an imminent end to the strike.
