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Ford has laid off 3100 people because of the strike!

2024-06-19 Update From: AutoBeta autobeta NAV: AutoBeta > News >

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AutoBeta(AutoBeta.net)10/23 Report--

Ford announced a further 364 job cuts in Ohio and Michigan, according to American Automotive News. Ford said it had told 354 workers in Sharonville Transmission, Ohio, and 10 workers in Rawsonville Components, Michigan, not to work from October 23.

GM strikers

It is understood that the above two factories supply parts to the Ford Kentucky truck factory, as a result of the UAW strike at the Ford Kentucky truck plant (Kentucky Truck Plant), which is Ford's largest factory in the world, mainly producing F-series pickups, Ford Expedition and Lincoln navigators, with an annual income of US $25 billion (about 182.6 billion yuan), accounting for 1/6 of the global total revenue. On Oct. 11, Ford announced that it would stop production at the Kentucky truck plant and lay off 550 workers. At present, Ford Motor has laid off a total of 3100 workers as a result of the UAW strike, making it the largest layoff among the three Detroit giants.

Shawn Fain, president of the UAW, warned that if the Detroit big three automakers fail to further raise wages and benefits, the group will organise strikes at more trucks and SUV plants in the United States, insisting that companies can afford higher wages and benefits than they are currently on the negotiating table, even though automakers are offering record prices. Fain said UAW had received offers for new contracts from GM and Stellantis in the past few days after a five-week strike, while Ford's new offer was made two weeks ago.

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GM, Ford and Stellantis are all offering more attractive contracts, including a 23% pay increase over four and a half years and significant increases in other benefits, but Fain says workers can get more advantages, and although the historic contracts offered by the big three automakers, given the sharp decline in workers' pay over the past two decades, it's not enough to be the best in history, which is a very low standard.

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It is understood that at the beginning of the negotiations, the salary demanded by the UAW union increased by 40%. Other demands include increasing paid vacation time, providing fixed benefit pension for all workers, retirement protection, etc., but the three major Detroit automakers failed to reach a final agreement with the UAW union. The UAW union began to strike the factories of the Detroit Big three on September 15. so far, the strike has entered its sixth week, resulting in economic losses of $7.7 billion. More than 34000 union members have taken part in the strike, and this is the first time that UAW has gone on strike against three car companies. Although Detroit automakers are still unable to reach a settlement with UAW in the future, escalation of the strike will not be ruled out.

As for the UAW strike, the reason is that auto workers have long been dissatisfied with the level of treatment and unfair distribution. The explanation given by Fain is that auto executives are getting high salaries every year, but workers' wages have never been raised. According to the BBC, the salaries of CEOs of all three auto companies in 2022 are more than $20 million, an increase of 40% in the past 10 years, but the real average salary of auto workers is far less than that.

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A deeper reason is that rising income inequality and rising inflation in the United States have made life more difficult for Americans, so workers are seeking higher wages and benefits under the leadership of trade unions. At present, due to the continuing strike, the Detroit Big three have to engage in more in-depth negotiations with UAW, but even if significant progress has been made, a final settlement has not been reached, and the possibility of expanding the strike in the future cannot be ruled out.

In the short term, as dealers still have inventory, U. S. car sales in the third quarter were not affected, but if the strike continues, the development of the auto industry is not optimistic, and ultimately affect the development of the global auto industry. At present, affected by the strike, the transportation of auto parts has been blocked, and automobile maintenance has been faced with impacts such as incomplete spare parts, extended maintenance cycle, blocked return of funds and so on. At the same time, the factory shutdown caused by the escalation of the strike will not only put pressure on the labour market, but also push up the price of new cars in the long run, exacerbating the inflation situation in the United States.

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