The automaker, which filed its complaint in the U.S. District Court for the Central District of California on Oct. 3, seeks a ruling that UAW Local 230’s decision to hold a strike authorization vote breaches the terms of the collective bargaining agreement reached last year.
On the same day, UAW Local 230 in Los Angeles voted overwhelmingly to request a strike authorization if an agreement can’t be reached.
The automaker’s complaint centers on Letter 311 of their 2023 bargaining agreement, which outlines Stellantis’s $19 billion in planned investments in U.S. facilities, including the Belvidere Assembly Plant in Illinois.
Stellantis argues that these investments were never unconditional, asserting they were always subject to approval by the company’s product allocation committee and “contingent upon plant performance, changes in market conditions, and consumer demand continuing to generate sustainable and profitable volumes.”
The complaint alleges that the UAW has ignored these conditions, engaging in a sustained, multi-month campaign to pressure Stellantis into making investments irrespective of the agreed-upon contingencies. The company alleges that UAW President Shawn Fain and the union filed “sham grievances” and misrepresented the terms of the agreement to justify the strike threats.
“Defendants’ sham grievances do not authorize Defendants to engage in mid-contract strikes, and Defendants have acted in bad faith and thus violated the implied covenant of good faith and fair dealing incorporated into the [collective bargaining agreement],” the complaint reads.
The lawsuit directly challenges Fain, accusing him of misleading union members by falsely claiming that Stellantis’s planned investments were “promises” or “commitments,” despite the contract’s explicit conditional language.
“Fain baselessly alleged Stellantis engaged in ’serious violations’ of the [agreement] and recommended to the UAW membership that they authorize a strike,” the automaker’s attorneys allege in the complaint, which asks the court to award Stellantis any monetary damages that result from the strike.
In response, Fain has dismissed the company’s legal threats as “desperate actions” and that the union’s lawyers have “complete confidence in our right to strike.”
In a letter to union members on Oct. 4, Fain accused Stellantis CEO Carlos Tavares of trying to gut the company’s U.S. operations to cut costs, claiming that “the only sham is Stellantis’s promises.”
“We will not sit back and watch this company violate our agreement and threaten our jobs, our plants, and our communities,” Fain wrote, while vowing to protect American jobs.
“We are united and we are defiant,” he added.
The dispute stems from Stellantis’s decision to delay several planned investments, including a $1.5 billion project to retool its Belvidere plant to produce mid-size trucks by 2027. The company has cited economic reasons for the delays, claiming the investments are contingent on evolving market conditions.
In August, the automaker acknowledged that it was delaying some investments and said it “firmly stands by its commitment” to carry out the investments at some point.
Reuters contributed to this report.
]]>- Stellantis plans to lay off thousands of workers in Detroit and Ohio in 2024 in order to adjust to California’s strict emission standards, raising concerns that other automakers may have to do the same, experts told the Daily Caller News Foundation.
- California has the strictest environmental standards in the country for vehicles and can use its dominant market share to influence broader U.S. trends, coercing automakers to design more expensive cars to fit that market, the experts said.
- “Considering the losses and layoffs we’ve already seen, the effects on the auto industry could be devastating,” Marlo Lewis, senior fellow at the Competitive Enterprise Institute, told the DCNF. “Millions of middle-income households are already priced out of the market for new motor vehicles.”
(Daily Caller)—California’s strict emission standards are poised to move the entire auto market towards more expensive, lower-emission vehicles, endangering the American auto industry, which is already posting huge losses in the electric vehicle market, experts told the Daily Caller News Foundation.
Top U.S. car manufacturer Stellantis sent notices to 2,455 workers in Detroit and 1,225 workers in Ohio on Dec. 8, notifying employees of possible layoffs to come in February in a move to shift its production to comply with California’s regulations that are increasingly cracking down on internal combustion engine vehicles, according to Barron’s. The projected layoffs from Stellantis could be one of many in the auto industry as California’s environmental regulations shift markets across the country, despite electric vehicles still not being affordable for many Americans and profitable for automakers, according to experts who spoke to the DCNF.
“The California standards have a huge impact,” Marlo Lewis, senior fellow at the Competitive Enterprise Institute, told the DCNF. “Both the [Environmental Protection Agency] in its proposed greenhouse gas motor vehicle standards and the National Highway Traffic Safety Administration (NHTSA) in its proposed corporate average fuel economy (CAFE) standards cite California’s [zero-emission vehicle] mandate as driving vehicle electrification in the U.S. Moreover, under Clean Air Act Section 177, other states may opt into California’s ZEV and [greenhouse gas] standards — if those policies are lawful in the first place, which of course California and its state and federal agency allies claim is the case.”
California is emboldened by the Environmental Protection Agency’s current standards under the Clean Air Act, which dictates that states must follow the federal government’s vehicle emission standards or opt into California’s more restrictive requirements. California has passed restrictions facilitating the switch away from traditional vehicles, requiring that all new cars, pickups and SUVs be electric or hydrogen-powered by 2035.
“The standards have a large effect because automakers don’t want to make different cars for different states,” Diana Furchtgott-Roth, director of the Center for Energy, Climate and Environment at the Heritage Foundation, told the DCNF. “That is why California affects the rest of the country. In addition, another 16 states have voluntarily said they will copy California’s laws.”
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The Biden administration has highlighted an EV charging company as evidence that its climate agenda is working. Now, the company’s stock is tanking, and the firm faces a class action lawsuit. @DailyCaller News Foundationhttps://t.co/XWSUXbA3IK
— Nick Pope (@realnickpope) December 12, 2023
California Gov. Gavin Newsom has previously touted the “California Effect,” which dictates that because of the state’s size and market share, it can dominate national trends and influence manufacturers, forcing them to tailor products to the standards or risk missing out on the market entirely, according to The New York Times. The state has the fifth-largest economy in the world.
“Considering the losses and layoffs we’ve already seen, the effects on the auto industry could be devastating,” Lewis told the DCNF. “Millions of middle-income households are already priced out of the market for new motor vehicles. Ford’s F-150 Lightning costs about $14,000 more than the comparable internal combustion engine (ICE) model. Energy analyst Robert Bryce reports that during second quarter 2023, Ford lost $72,762 for every EV it sold, and that in July, Ford projected $4.5 billion in EV-related losses by year’s end—more than double the company’s $2.1 billion EV business losses in 2022.”
Following the losses, Ford sent out a memorandum on Tuesday to suppliers that it was cutting production of its F-150 lightning pickups in 2024 from a weekly target of 3,200 to 1,600 units.
As losses mount for automakers, the Biden administration is pushing for even greater production with subsidies to the EV industry. The Biden administration, through the Inflation Reduction Act, has instituted a $7,500 tax credit per EV in an attempt to make the cars more affordable.
“The standards will raise the costs of transportation, disproportionately hurting poor people, small businesses and farmers,” Furchtgott-Roth told the DCNF. “Some people like EVs, but others find them to be more expensive, inconvenient to charge, and difficult in cold climates because they lose range. Plus, these EVs make America depend on China. The auto industry is losing money trying to comply with the standards because people are not buying electric vehicles in sufficient quantities.”
While the number of people buying EVs is growing, not enough people are opting into buying an EV to keep up with the rising supply following the regulations and subsidies in the industry. The total volume of EVs sold in January was 3% of new cars, making up 3% of market share, but as of September, volume has risen to 6%, while sales have only risen to 4%.
The current production of EVs requires the use of rare earth minerals, specifically in the vehicle’s battery, with China currently controlling around 87% of the world’s refining capacity for the components. The U.S. has so far been unable to compete in the market, but the Department of Defense has committed millions of dollars to cultivating domestic ventures.
“This agenda is a massive threat to consumer welfare,” Lewis told the DCNF. “In the short term, some automakers may profit from government handouts and the narrowing of competition. In the long term, an industry that does not produce what consumers want at prices they can afford is in big trouble.”
The California governor’s office did not immediately respond to a request to comment from the DCNF.
All content created by the Daily Caller News Foundation, an independent and nonpartisan newswire service, is available without charge to any legitimate news publisher that can provide a large audience. All republished articles must include our logo, our reporter’s byline and their DCNF affiliation. For any questions about our guidelines or partnering with us, please contact [email protected].
Despite weeks of negotiations, the union was unable to come to an agreement over contract negotiations with General Motors, Ford, and Stellantis—known as the big three—before current contracts expired, prompting thousands of its members to walk out of three factories across the country in Missouri, Michigan, and Ohio.
The strikes are taking place at Ford’s Bronco assembly plant in Wayne, Michigan, GM’s mid-sized pickup truck assembly plant in Wentzville, Missouri, and Stellantis’s Jeep assembly plant in Toledo, Ohio.
It is unclear how long the strikes will last, however UAW—the largest union in the nation—has an $825 million strike fund that will compensate workers $500 a week while out on strike.
Video footage shared online showed some of the strikes began promptly after midnight, with dozens of workers taking to the streets and holding posters stating “end tiers” and “record profits, record contracts,” and chanting in support of the strikes and higher pay.
“This fight is our generation’s defining moment,” UAW said in a press release announcing the strike late Thursday. “Not just at the Big Three, but across the entire working class. We will stand up for ourselves. We will stand up for our families. We will stand up for our communities.”
UAW represents some 150,000 workers at General Motors, Ford, and Stellantis, however approximately 12,700 workers will be taking part in the strike, UAW President Shawn Fain said at a press conference Thursday night; 3,600 at GM, 3,300 at Ford, and 5,800 at Stellantis.
“Leading into the final hours of the strike deadline, we’ve been working hard trying to reach a deal for economic and social justice for our members. We have been firm. We are committed to winning an agreement with the big three that reflects the incredible sacrifice and contributions UAW members have made to these companies,” Mr. Fain said.
The strikes are expected to have significant business and economic implications. According to Anderson Economic Group (AEG), a work stoppage of 10 days could result in a total economic loss of more than $5 billion. The strike also has the potential to lead to higher car prices amid lower inventories, according to AEG.
Strikes Will Have ‘Wide-Ranging Consequences’
Meanwhile, the plants involved in the strikes are also critical to the three automakers’ productions. Some of their most profitable vehicles include the Ford Bronco, Jeep Wrangler, and Chevrolet Colorado pickup truck.
A full strike at each of the automakers could see losses of around $400 million to $500 million per week assuming all production was lost, Deutsche Bank has estimated.
Despite weeks of negotiations, union members and the big three have failed to reach an agreement over pay, enhanced benefits, and pensions.
The union has proposed a four-year contract with 40 percent pay increases, a reduced 32-hour work week, the elimination of compensation tiers, a restoration of cost-of-living adjustments, and the restoration of traditional pensions, among other items.
The automakers, which have all recorded record or near-record profits, have so far declined to meet that rise, instead offering 20 percent without key benefits demanded by the union, citing concerns that such pay hikes could effectively put them out of business.
Hours before the deadline passed, Ford said it had bargained “in good faith” in an effort to avoid a strike, which the company said “could have wide-ranging consequences for our business and the economy.”
The company said the last offer it submitted to the union was “historically generous, with large wage increases, cost of living adjustments, more paid time off, additional retirement contributions, and more.”
“Unfortunately, the UAW’s counterproposal tonight showed little movement from the union’s initial demands submitted Aug. 3. If implemented, the proposal would more than double Ford’s current UAW-related labor costs, which are already significantly higher than the labor costs of Tesla, Toyota, and other foreign-owned automakers in the United States that utilize non-union-represented labor,” the company said.
Ford said it remains “absolutely committed to reaching an agreement that rewards our employees and protects Ford’s ability to invest in the future as we move through industry-wide transformation.”
Union Prepared to ‘Go All Out’
General Motors said it was “disappointed by the UAW leadership’s actions.”
“Despite the unprecedented economic package GM put on the table, including historic wage increases and manufacturing commitments. We will continue to bargain in good faith with the union to reach an agreement as quickly as possible for the benefit of our team members, customers, suppliers, and communities across the U.S. In the meantime, our priority is the safety of our workforce,” the automaker said in a statement Thursday.
Stellantis has not yet commented on the strikes. The Epoch Times has contacted a Stellantis spokesperson for comment.
The “stand-up strikes”—effectively staggered strikes across the various automakers’ factories—are a nod to the historic “sit-down” strikes UAW members held in the 1930s, and avoid a full walkout.
UAW President Mr. Fain said during Thursday’s press conference that the strategy will “keep the companies guessing,” and give its national negotiators “maximum leverage and flexibility in bargaining.”
However, Mr. Fain warned that the UAW will go “all out” if it needs to, adding that “everything is on the table.”
He also clarified that workers who have not yet been called to join the strike will continue to work under the expired contract.
Speaking to reporters outside the Ford facility in Wayne minutes after the strike began Thursday, the union head criticized the three companies for allegedly failing to negotiate in good faith.
“They waited until the last week to want to get down to business, shame on them,” he said. Mr. Fain also said he believes it is a complete “joke” that the companies have suggested the strikes may bankrupt them.
“The cost of labor that goes into a vehicle is 5 percent of the vehicle, they could double our wages and they could not raise the price of vehicles and they could still make billions of dollars, it is a lie like everything else that comes out of their mouths.”
The union head also hinted that more strikes could take place at further facilities if the three companies are unable to meet the union’s demands.
The last time there was a UAW strike was in 2019 when the union went on strike for six weeks against General Motors. It cost the automaker $3.6 billion.
]]>The company dropped a statement for local media:
Our industry has been adversely affected by a multitude of factors like the ongoing COVID-19 pandemic and the global microchip shortage, but the most impactful challenge is the increasing cost related to the electrification of the automotive market.
Stellantis has taken a number of actions to stabilize production and improve efficiency at its North American facilities to preserve affordability and customer satisfaction in terms of quality.
While it considers other avenues to optimize operations, Stellantis has made the decision to idle the Belvidere (Illinois) Assembly plant effective Feb. 28, 2023.
This difficult but necessary action will result in indefinite layoffs, which are expected to exceed six months and may constitute a job loss under the Worker Adjustment and Retraining Notification (WARN) Act. As a result, WARN notices have been issued to both hourly and salaried employees. The company will make every effort to place indefinitely laid-off employees in open full-time positions as they become available.
The company also is working to identify other opportunities to repurpose the Belvidere facility and has no additional details to share at this time
According to WIFR:
Stellantis is one of the largest employers in Boone County. Thousands of workers will be affected by the halt in operations.
Local leaders are also weighing in on the news Friday and its effects on the community:
Senator Steve Stadelman, a sponsor of the Reimaging Electric Vehicle Act which includes state resources for Illinois automakers ready to make the switch to electric vehicle production released this statement:
”Stellantis’ announcement is difficult news for the Rockford region, but discussions between the state and the company continue to find a future product and identify opportunities to repurpose the plant that for decades has been a source of good jobs and financial security for thousands of local families.”
The left’s push for the green agenda is crippling businesses who are trying to keep up with forced wokeness. The automotive industry is being hit hard and their troubles are just getting started.
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