As Predicted, UAW Strike Remains Limited, Spares Automakers From Full Walkout

It only took about three weeks, but mainstream journalists are becoming aware of something the Competitive Enterprise Institute has been pointing out from the start: The United Auto Workers strike against Ford, GM and Stellantis (owner of the Chrysler auto brand) has thus far been more of a public relations move than a strike. There’s been little actual traditional strike activity is happening and what has happened hasn’t hurt domestic auto manufacturers much.

“UAW Strike Spares Carmakers Financially,” noted the headline for the Wall Street Journal’s Friday print edition. “[T]he decision to forgo the all-in strike that many industry observers had expected has so far considerably softened the disruption to the companies’ factory footprints and bottom lines,” the Journal noted. “For automakers, a lot of blows but no big punch,” NPR reported Thursday.

Friday’s big announcement was that the UAW was making progress and therefore the union would not be putting more workers on the picket lines. The union and the manufacturers are still far from a complete deal however. GM offered a concession on EV vehicle manufacturing and that was enough for the union to keep its powder dry. Currently just 25,000 of UAW’s 146,000-odd members are on the picket lines and that won’t change for at least another week.

Its an odd strategy to spare your opponent pain when you want them to make concessions. Unless, that is, the effort would be just as painful for the union. UW doesn’t have a strike fund to sustain a prolonged all-in strike. Workers on the picket lines would get about $500 a week from the union, barely enough to get by. The union’s fund was reportedly $800 million at the start of the strike. UAW could afford a full strike for just three months. So it is making a virtue of necessity and ordering limited strikes, presenting this a new strategy.

The strikes began in mid-September with a lot of dramatic headlines like “Economic Impact of an Auto Strike Could be Felt Nationwide” and “How the UAW strike could have ripple effects across the economy.” These were true as far as they went but nevertheless obscured the fact that UAW was not engaging in a traditional all-in strike. The current strike has cost GM just $200 million in its first wo weeks, the Journal reported. Contrast that with a 2019 strike at GM 2019, which cost the automaker $1 billion over the same period.

As CEI noted when the strike began, “The claim that this ‘stand up’ approach creates the maximum pressure is bogus. History clearly shows that if a union wants a serious confrontation with the manufacturers, it has all of its members on the picket lines. … The fact that [UAW President Shawn] Fain hasn’t ordered that suggests he doesn’t actually want that or doesn’t think the union could sustain it.”

After two weeks, Fain tacitly conceded there had been no progress in the talks, so he upped the pressure to 25,000 workers on the picket lines, or about one-sixth of the UAW’s members. To be clear, this is causing problems for manufacturers. Fain has targeted the plants where work stoppages can cause the most economic damage. Losing $200 million is still real money even for a corporation like GM. But the UAW’s call for wage increases of up to 36 percent, well beyond the 20 percent the auto makers have offered, is something the manufacturer hasn’t budged on yet. And it isn’t likely to so long as only one-sixth of the UAW members are striking.