UAW Agrees with Big Three, Eyes Tesla Union Formation... Will No-Union Management Break?

UAW Chairman "Next Negotiations with Big 5 or Big 6"
Musk Expected to Take Hardline... Previously Blocked Union Formation

The United Auto Workers (UAW), which conducted the first-ever simultaneous strike against the three major American automakers?Ford, Stellantis, and General Motors (GM)?and ultimately reached an agreement, is now pushing to establish a union within Tesla, the world's largest electric vehicle company. Elon Musk, CEO of Tesla, who has maintained a 'no union' management principle, is expected to take a hardline stance, drawing attention to whether the UAW can achieve its goal.

[Image source=Reuters Yonhap News]

Bloomberg News reported on the 30th (local time), citing sources, that a UAW organizing committee has been established at Tesla's Fremont plant in California, and they are appealing to their colleagues about the benefits of collective bargaining and the necessity of forming a union. It is said that the UAW is sparing no support for this effort. The Fremont plant employs about 20,000 workers.

This report came alongside the conclusion of the UAW's simultaneous strike against the Big Three.

On the same day, the UAW reached a tentative agreement on a new labor contract with GM. After more than a month of simultaneous strikes against the Big Three automakers starting from the 15th of last month, negotiations were completed with Ford, Stellantis, and finally GM. Accordingly, the simultaneous strike is moving toward its conclusion. The negotiations between the UAW and the three companies were the first in four years since 2019, and the results of this agreement will apply until April 2028.

The UAW's next goal is to expand its influence. UAW President Shawn Fain said the day before, "One of our biggest goals built on this historic victory is to establish unions where we previously could not," adding, "When we return to the negotiating table in 2028 after this agreement ends, our counterparts will not be just the Big Three but the Big Five or Big Six."

Several global automakers, including Toyota and Volkswagen, which have factories in the United States, maintain no-union management. Among them, Bloomberg reported that Tesla is the UAW's target. As the largest company by market capitalization and with the market's main products shifting from internal combustion engine vehicles to electric vehicles, this is interpreted as a way for the UAW to maintain its influence.

Sean Fain, former president of the United Auto Workers (UAW)
[Photo by AP Yonhap News]

Elon Musk Tesla CEO
Photo by Reuters Yonhap News

Earlier this month, President Fain also said, "There are thousands of automotive industry workers who have not joined the union but want to participate in our activities and are in contact with us," referring to workers at Tesla, Toyota, and Honda as "the future union members of the UAW."

This is not the first time the UAW has attempted to establish a union at Tesla. In 2016, Jos? Moran, a production worker at the Fremont plant, tried to organize a union with the UAW. In February 2017, Moran publicly drew significant attention by pointing out that overtime was frequent at Tesla and wages were relatively low compared to other companies, and he was making efforts to form a union.

However, the UAW's unionization efforts faced a wall in Elon Musk, the CEO known for his anti-union management. Musk has repeatedly voiced criticism of unions in public. He personally targeted Moran, saying, "He works for the UAW, not for us (Tesla)." At the same time, Tesla took extensive measures to harm employees who were organizationally pushing for union formation.

Subsequently, in 2018, Tesla experienced a management crisis, and a corruption scandal involving UAW leadership broke out, causing the momentum for unionization at Tesla to lose steam.

Bloomberg evaluated that in recent years, unions have been emerging one after another at companies like Amazon, Apple, and Starbucks, and due to high inflation, poor working conditions, and widening income inequality, workers' willingness to form unions has increased, changing the atmosphere.

Seth Harris, a professor at Northeastern University and former vice chair of the White House National Economic Council (NEC), said, "Any effort to form a union at Tesla will truly be a battle royale," but added, "Elon Musk should not underestimate President Fain. The UAW is showing itself to be an aggressive and well-organized force."