Employees at three major American carmakers are on the brink of striking in a highly coordinated action, a move that could lead to significant disruptions for GM, Ford, and Stellantis and

potentially result in higher prices for consumers as labor contracts are set to expire on Thursday night. The United Autoworkers Union (UAW) claims that the companies have not presented acceptable offers.

The UAW president, Shawn Fain, expressed frustration with the lack of progress in negotiations, citing a failure to agree on wage increases that would compensate for inflation and decades of falling wages. The UAW had initially sought a 40% pay raise for its approximately 140,000 members over four years, alongside other demands like a four-day workweek, reinstating automatic pay increases tied to inflation, and stricter limits on the classification of workers as "temporary" without union benefits.

Talks between the UAW and the automakers began in July and have been tense since the outset. Last month, 97% of UAW members voted in favor of authorizing a strike.

As of Wednesday, the three companies have improved their initial proposals: Ford offering a 20% pay increase over the contract term, GM offering 18%, and Stellantis, which owns Jeep and Chrysler, offering 17.5%, according to Mr. Fain.

Workers believe that the companies can afford to be more generous given their years of record profits. Paul Raczka, a Stellantis factory worker in Michigan, argued that they are owed better compensation, especially when CEOs are earning millions each year while employees struggle to make ends meet.

The auto industry in the United States is currently grappling with slowed sales and increased costs related to the shift towards electric vehicles. A potential 10-day strike across all three companies could cost car manufacturers nearly $1 billion and workers almost $900 million in lost wages. Estimates from the Anderson Economic Group suggest the total economic impact could exceed $5 billion as the strike's effects ripple through the economy.

The ongoing supply shortage in the automotive sector, stemming from pandemic-related parts shortages, means that a prolonged strike could lead to higher car prices for consumers. Together, Ford, GM, and Stellantis represent approximately 40% of US car sales, though their market share has declined over the past 25 years as foreign automakers like Toyota have gained traction.

The United States has seen a rise in labor tensions as workers, impacted by rising prices and a tight labor market, become more assertive in their demands. In 2022, there were over 420 work stoppages, an increase of more than 50% from the previous year, according to Cornell University research.

While the automotive industry faced a strike in 2019 when General Motors workers went on strike for six weeks, the stakes are higher this time around due to the ongoing supply challenges and economic pressures. Despite the financial strain a strike could impose on workers, many, like GM worker Jessie Kelly, continue to support the fight for fair compensation and benefits in the face of corporate profits that seem to perpetually elude the workforce. Photo by Mikerussell at en.wikipedia.