© Reuters.
The United Auto Workers (UAW) and General Motors (NYSE:) have reached a preliminary labor contract agreement that could potentially conclude the six-week strike affecting GM, Ford Motor (NYSE:), and Stellantis (NYSE:). The strikes began after the expiration of the previous contract on September 15, 2023.
The proposed terms of the new agreement include a significant 25% wage increase for UAW members over four and a half years, potentially boosting the top UAW wage from $32 to more than $40 per hour. In addition, cost-of-living adjustments may be introduced. However, these changes are pending approval from the union council and ratification by approximately 46,000 workers.
The strike involved over 14,000 GM workers and led to significant production disruptions. High-demand vehicles such as the Cadillac Escalade S.U.V., Chevrolet Colorado pickup truck, and Chevrolet Traverse S.U.V. saw production halts, resulting in an estimated $800 million earnings loss for GM.
In a process known as pattern bargaining, the UAW negotiates similar contracts with all three automakers. This method aims to maintain parity among workers across the industry. The move towards a more competitive wage structure comes as these companies strive to curb labor costs in order to compete with nonunion automakers such as Tesla (NASDAQ:), Toyota (NYSE:), and Honda (NYSE:).
The tentative agreement marks a potential end to one of the most significant labor disputes in recent automotive history. The final decision now rests in the hands of the union council and the workers themselves.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.
