Striking Stellantis Workers Considering Tentative Deal

United Auto Workers union members went on strike over the weekend to pressure Stellantis into retaining jobs they’re worried might evaporate as the industry attempts to transition to battery electric vehicles. UAW Local 1166, representing the workers at the engine and transmission plant located in Kokomo, Indiana, was in negotiations with the automaker over this weekend. But things fell apart on Saturday, leading to a formal strike that has reportedly resulted in a tentative agreement on their local contract.

Since this is the UAW we’re talking about, there was no way around the catch-all request to improve health and safety at the site. But there also looks to be genuine fear that the automaker will begin closing factories responsible for manufacturing internal combustion engines (and any related components) as the industry pushes ahead with EVs.

“The bargaining committee stood strong with the support of the striking UAW Local 1166 members to win an agreement that will correct the poor working conditions,” UAW President Ray Curry explained in a statement. “This tentative agreement is a testament to UAW solidarity. Their working conditions will greatly improve, and they have given us all inspiration to fight for justice and respect in our workplaces.”

Automotive News cited the UAW expressing an interest in Stellantis retaining jobs at engine and transmission plants while also demanding that workers assembling batteries have union representation and comparable wages and benefits. If jobs cannot be retained, union members would like there to be a pathway where existing workers could receive training for subsequent EV plants. But leadership also wanted Stellantis to put some money back into the Kokomo casting plant, which they claimed had been neglected for years.

“The environment in the plant has deteriorated over the years due [to] the company’s decision to save money by not properly maintaining or providing the proper HVAC in the plant. The bargaining committee also fought hard to win dozens of demands that the members had submitted. This agreement will address these and many other issues that will benefit the Local 1166 members,” said UAW Vice President Cindy Estrada.

Some of those demands allegedly included provisions to retain jobs and guarantee fresh investment into what is one of the largest die-cast facilities in the world. This mimics what we’ve seen from German unions, specifically IG Metall, which have grown increasingly concerned that EVs will displace a large number of auto workers. After years of issuing warnings that the push toward EVs would undoubtedly mean fewer jobs and increased offshoring that primarily benefited Chinese battery suppliers, IG Metall has launched a campaign intended to re-skill the domestic workforce and localize as much battery production as possible.

Last year, the Munich-based Ifo Institute for Economic Research, suggested that the transition to electric vehicles could cost the industry some 100,000 jobs in combustion engine production by 2025. The group suggested the best defense against this (other than sticking with combustion cars) was to ensure the preexisting workforce was retrained.

But Central Asia already has the battery market more or less cornered and Earth reached its automotive sales peak in 2017 at 80 million units. As a result, we’ve seen most Western automakers culling thousands of jobs over the last several years. Production stoppages stemming from the aggressive response to the pandemic have only exacerbated this issue. Material costs have likewise been skyrocketing and manufacturers seem incapable (or broadly unwilling) of increasing output as vehicle prices surpass record highs.

Neither the UAW nor Stellantis has disclosed any formal details about the terms of the tentative agreement reached on Monday. Though the latter group did express some disappointment about the union opting to strike. For what it’s worth, Stellantis and South Korea’s Samsung SDI made an announcement in July that they would be investing $2.5 billion to build a battery plant in Kokomo, Indiana. Millions of dollars are also being spent in Indiana and elsewhere to prep factories to build hybrid powertrains. So the region is still valuable to the company, even if it ultimately decides to shrink its workforce in the coming years.

[Image: Daniel J. Macy/Shutterstock]

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