Stellantis faces unprecedented UAW strikes a year after national walkout by Reuters

By Nora Eckert

DETROIT (Reuters) – The United Auto Workers union is eyeing more U.S. strikes against Franco-Italian automaker Stellantis (NYSE: ) about a year after a nationwide walkout cost the Detroit automakers $3 billion and laid off 50,000 workers.

Accusing Stellantis of breaking its contract promises, UAW President Shawn Fain warned late Tuesday that several local sectors of the union are laying the groundwork for strikes that could collectively shut down the automaker.

The UAW’s latest threats follow last year’s six-week strike that cost Stellantis about 750 million euros ($834.08 million) in profits. The union also hit General Motors (NYSE: ) and Ford (NYSE: ) during the historic walkout in 2023 and drew U.S. President Joe Biden to the picket line to show support for striking workers.

Stellantis’ North American operations have been struggling, and the threat of a strike looms as the race for the White House between Democrat Kamala Harris and Republican Donald Trump heats up. Harris, who is currently the US Vice President, was endorsed by the UAW.

Union strikes outside of four-year contract negotiations are unusual, and a big walkout on Stellantis just a year into his labor agreement in an election year would be unprecedented.

“The syndicate chose the perfect time to target Stellantis as the North American group is probably at its weakest point,” said Sam Fiorani, vice president at research firm AutoForecast Solutions.

Fain said Tuesday that 28 locals, covering tens of thousands of workers, had filed grievances against Jeep parent Stellantis and that 18 were at or near the point where they could seek a strike authorization vote — at least one expected in the following days. . Fain, who rose through the union ranks after working as an electrician for Chrysler, brought a more combative approach and a new leadership team to the union after his 2023 election.

The location and timing of the first strike authorization vote are still uncertain, but locals who filed complaints last month included factories in Toledo, Ohio; Kokomo, Indiana and more in Michigan. The UAW said about 98 percent of Stellantis members are covered by those grievances, making possible strikes as powerful as a nationwide walkout.

Stellantis could not be reached for comment Wednesday, but said after Fain’s warning the day before that the union leader had not provided data or information to support his claims.

“(Fain) continues to intentionally damage the company’s reputation with his public attacks, which is not helpful to anyone, including its members,” Stellantis said in a statement. “We would all be better served if these issues were addressed across the table with productive, respectful and forward-looking dialogue. A strike does no one any good.”

The UAW’s grievances center on product and investment commitments made during contract negotiations last fall. Delays to a planned multibillion-dollar investment in a new plant and battery plant in Belvidere, Illinois, and possible plans by Stellantis to move production of the Dodge Durango SUV out of the U.S. have emerged as major sticking points for the UAW.

Stellantis said he has not confirmed plans to move Durango. The contract signed between the UAW and the automaker allows the company to delay financial commitments if market conditions worsen.

PROBLEMS IN THE US MARKET

Stellantis’ U.S. business has faltered over the past year, with dealers and shareholders publicly flagging its lagging sales, bloated inventory and falling stock price.

CEO Carlos Tavares said he is focused on improving Stellantis’ performance in the US and has expressed a desire to close the brands globally if they don’t make money. Last month, he visited the US with the intention of developing a plan to improve US operations.

Still, the U.S. automaker’s vehicle inventories are higher than they were a year ago before the strike, which could shield Stellantis from any immediate pain if workers hit the picket lines, analysts said. Its 77-day supply of vehicles at the end of August was up 18 days from the same period last year, according to industrial company Cox Automotive.

However, the UAW could target plants that make higher-demand vehicles, such as Jeep SUVs, Fiorani said. A more targeted approach would allow the UAW to spend less money supporting striking workers.

A new strike now would capture the White House’s attention in the run-up to the November 5 US election. Michigan is a battleground state that both Harris and Trump have visited several times.

Officials with the Harris and Trump campaigns could not immediately be reached for comment.

Harris has the support of many unions as he tries to attract support from more working-class voters. Trump said Fain is costing union members their jobs as the industry moves production outside the US and loses ground to China.

The Teamsters executive board meets Wednesday, when the union decides who to endorse.

Fain said the UAW, in last year’s agreement, won the right to strike over financial and product commitments. However, this could be tested in court, said Art Wheaton, a labor professor at Cornell University.

According to union procedures, Stellantis has several opportunities to respond to UAW grievances. If the issues remain unresolved, the union has 60 days to hold a strike vote. A strike authorization does not necessarily mean that a strike will take place.

(1 USD = 0.8992 euros)