Around press time here at Nightcap, news broke that the United Auto Workers union was preparing to strike. More on that here.
We've written a lot here about the union's demands — higher pay, a four-day workweek, a revival of traditional pension plans, etc — and the wide gulf between the two sides that make a strike seem inevitable.
But my colleague Chris Isidore traveled to Kokomo, Indiana, to better understand some of the deeper issues at play in the dispute. It is an intensely American tale about the promises and pitfalls of our capitalist system.
Kokomo is an industry town (population 59,000) surrounded by green farm fields between Indianapolis and South Bend.
It is the kind of place where a brand new, $2.5 billion factory, complete with 1,400 expected jobs, would be considered a positive development.
It's not quite working out that way.
"It's a spit in the face," said Gary Quirk, president of United Auto Workers Local 685.
That's because the new plant — a joint venture of Stellantis (Chrysler's parent company) and Samsung — will make large batteries for electric vehicles.
UAW Local 685 represents four factories that Stellantis already operates in the town: three that make transmissions, one that makes engines.
The workers' frustrations reflect a larger dilemma in the US auto industry: EVs simply require less work. And that means many of the historically high-wage union jobs building engines are disappearing.
In Kokomo, four Stellantis plants employ 4,500 hourly workers and another 600 salaried staff, or better than one out of every seven non-farm jobs in the city and the surrounding area.
"We know we're on borrowed time," said Todd Dunsmore, who has worked at Stellantis for seven years.
Some members of Dunsmore's local UAW are not as convinced that EVs are an imminent threat to their jobs. Many believe the carmakers will find other uses for the Kokomo plants, even if they no longer need transmissions or engines.
Philip Kline has worked at one of the transmission plants in town for 27 years. His dad worked there for 30 years. He doesn't believe that there is real demand out in the public for EVs.
"The thing that worries me is that Biden is rushing this," he said.
That's a common fear — that the auto industry will be forced to shift to EVs whether or not there is demand for them.
"I don't believe that people are ready for EVs, to be honest with you," said Quirk. "The politicians might be ready, but I don't believe the people are."
While EV sales are still only a fraction of vehicle sales, automakers see growing public demand. And they know they'll need to comply with increasingly tougher environmental regulations around the world.
The new EV jobs, which the automakers are building in partnership with foreign companies, won't be unionized, at least not at the beginning.
Senior UAW members at Stellantis, General Motors and Ford get $32.32 an hour currently. The EV battery plant workers are likely to start at half that, Quirk said.
Bottom line: The UAW said it doesn't oppose plans to shift to EVs, even though by some estimates that could mean a 30% drop in jobs because EVs have fewer moving parts and need less labor to make. But the union says it must be a "just transition" to EVs with good-paying, unionized jobs. It says the EV plans make these talks "our generation's defining moment."
Read Chris' full story here.
Related:
- UAW President Shawn Fain said the union is prepared to limit strikes to targeted plants rather than an all-out stoppage — a move he said would maximize the union's leverage.
- "The automakers can't plead poverty," Former Ford CEO Mark Fields tells CNN's Matt Egan. Fields has words of caution for both sides of the contentious negotiations.
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