UAW and GM: Strange Bedfellows
If the UAW ratifies the new GM contract and agrees to the VEBA, they could end up as GM's biggest shareholder. Based on information about the VEBA provided by the UAW, Financial Times estimates GM's contribution will include a $4.4b note that can be converted into GM stock. At current rates, that would buy a 17 percent equity stake in GM. What would happen then is anyone's guess, but it sounds like a huge conflict of interest in the making. Would the UAW be as willing to take actions against GM in support of their membership if they knew it could cause the value of the stock to drop and hurt their members? Will the UAW try to exert influence via shareholder meetings in lieu of contract negotiations? Fun!
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