UAW Strike Intensifies: Auto Workers Heighten Actions, Casting Shadow on US Economy

The United Auto Workers (UAW) union is extending its strike at major American car manufacturers, pushing the dispute over pay and benefits into its third week.

Union leader Shawn Fain announced that an additional 7,000 workers at Ford and General Motors factories are planning to go on strike.

This latest action does not include Stellantis, indicating progress in negotiations with that company.

Around 18,000 workers were already on strike, and this dispute has cast a shadow over the US economy.

Both US President Joe Biden and former President Donald Trump, who is running for re-election, visited the Detroit area this week to address the issue, which coincides with simmering labor tensions across the country.

The union initiated talks with a demand for approximately a 40% pay increase over four years and an end to practices that result in lower pay and fewer benefits for newer employees, among other requests.

The car companies argue that the union's demands would hinder their long-term investment capability and have countered with a roughly 20% pay increase and some concessions.

Many workers on the picket lines in Michigan are prepared for a prolonged battle, expressing frustration and emphasizing the need for a robust middle class, especially in light of the companies' substantial profits.

The UAW represents 146,000 workers at these three companies and has been gradually increasing pressure on them to reach an agreement since labor contracts expired on September 14.

The latest strike expansion includes a Ford factory in Chicago that produces Explorers and a GM factory in Michigan that makes large crossover SUVs such as the Chevrolet Traverse and Buick Enclave.

General Motors criticized the additional strikes, stating that they are more for headlines than real progress and that they have not received a comprehensive response since they proposed a deal on September 21.

The economic impact of the strike is growing, with an estimated $1.6 billion (£1.3 billion) in economic losses and over $100 million (£81 million) in lost wages in the first week alone. Local businesses are feeling the pinch, with reduced sales and slower economic activity.

For the car companies, already facing significant investment costs and fierce competition as the industry shifts toward electric vehicles, the timing of this dispute is highly unfavorable, according to Wall Street analyst Dan Ives of Wedbush Securities.

Workers on strike remain committed to the fight, even though many will receive only $500 (£410) in strike pay per week, resulting in financial strain. They are determined to stand their ground in pursuit of their demands.