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auto industry
Citing Glut of Stock Buybacks, US Lawmakers Demand Stellantis Uphold Contract With UAW
"We believe that if Stellantis can afford to spend over $8 billion this year on stock buybacks and dividends, it can live up to the contractual commitments it made to the UAW."
Oct 24, 2024
In what the United Auto Workers hailed as "a powerful show of solidarity," scores of U.S. lawmakers on Thursday sent letters to "Big Three" automaker Stellantis and its CEO, Carlos Tavares, urging them to honor their contractual obligation to their employees, protect American jobs, and stop making excuses amid record profits and multibillion-dollar stock buybacks and dividends.
"We are writing to express our growing concerns about the failure of Stellantis, under your leadership, to honor the commitments it made to the United Auto Workers (UAW) in last year's collective bargaining agreement," says one letter led by Sens. Bernie Sanders (I-Vt.), Gary Peters (D-Mich.), Dick Durbin (D-Ill.), Debbie Stabenow (D-Mich.), and Tammy Duckworth (D-Ill.) and signed by 18 of their Democratic colleagues.
"We urge Stellantis not to renege on the promises it made to American autoworkers and to provide details on the timelines for these investments," the senators wrote.
Meanwhile, 56 members of the Congressional Labor Caucus led by Reps. Debbie Dingell (D-Mich.), Mark Pocan (D-Wis.), and Donald Norcross (D-N.J.) sent a separate letter, this one to Stellantis' board of directors, calling on Chrysler's parent company to "follow through on promises to workers to invest in its domestic workforce."
"Given the significant governmental financial support for Stellantis over the years, we have become alarmed by a steady stream of reports indicating your plans to lay off auto workers and move production out of the United States, and that you are failing to honor contractual commitments that Stellantis made as part of the 2023 national collective bargaining agreement," the letter states.
Last November, UAW workers at the Big Three—GM, Ford, and Stellantis—ended a six-week "stand-up strike" and signed new contracts with better pay, benefits, and working conditions. Stellantis committed to making nearly $19 billion in new domestic investments, reopening its "indefinitely idled" Belvidere, Illinois plant, continue manufacturing the Dodge Durango SUV in Detroit through 2025, and build the next-generation Durango in the city starting in 2026, among other promises.
However, according to the senators' letter:
Stellantis is now delaying planned investments to reopen and expand the Belvidere assembly plant, leaving behind thousands of American workers who built the company into the auto giant it is today. We are also concerned with reporting that Stellantis is planning to move production of the next-generation Dodge Durango out of the United States, after previously announcing layoffs that threaten the economic security and well-being of thousands of autoworkers.
Moreover, Stellantis has stated publicly that it plans to source 80% of supply from "low-cost countries" like Mexico. By your own admission, Stellantis' growth plan hinges on shifting "industrial production into cost-competitive countries" like Mexico, where workers are making substandard wages. These actions violate the obligations Stellantis made to the UAW.
"Taxpayers are currently funding consumer incentives for several Stellantis vehicles and Stellantis is slated to receive $585 million under the Domestic Manufacturing Conversion Grant Program," the House lawmakers noted in their letter. "Under this program, Stellantis is on track to pocket $335 million to reopen the Belvidere Assembly plant in Belvidere, Illinois. As stewards of taxpayer funding, we have a responsibility to ensure these investments benefit the public interest."
"We hope it is clear to you that the American people will not tolerate taxpayer subsidies for a company that is cutting production and slashing jobs—all the while it increases executive compensation, dividends to shareholders, and stock buybacks," the letter adds.
The senators noted that "this year, Stellantis has spent over $8 billion on stock buybacks and dividends to benefit its wealthy executives and stockholders, and that "last year, while blue-collar auto workers in Belvidere were being laid off indefinitely, you were able to receive a 56% pay raise boosting your total compensation to $39.5 million, which made you the highest paid executive among traditional auto companies."
"During the first six months of this year, Stellantis has generated over $6 billion in profits, making it one of the most profitable auto companies in the world," the letter adds. "We believe that if Stellantis can afford to spend over $8 billion this year on stock buybacks and dividends, it can live up to the contractual commitments it made to the UAW."
Last week, the UAW published a powerful video in which union president Shawn Fain makes some of the same demands that are in the lawmakers' letters.
"For years, this company has picked us off, plant by plant, and our leadership lacked the will and the means to fight back," Fain said in the video. "Those days are over."
Fain continued:
Stellantis management has launched a campaign of intimidation and harassment against our members, our local unions, and the International UAW to try to get us to back down from the fight to save our jobs.
I have bad news for Stellantis: We're not going anywhere.
Their corporate lawyers are claiming that our fight to keep jobs in Belvedere, Detroit, and America is based on what they call "sham grievances."
But here's the real sham: Over the past nine weeks, Stellantis has spent over a billion dollars on stock buybacks, all while saying they can't afford to keep their commitments to their own employees. In fact, Stellantis has spent $3 billion on stock buybacks this year alone.
The real sham is this campaign of intimidation and interference in our union's business. Stellantis managers are calling members, threatening their jobs. They're emailing our local presidents threatening lawsuits. This is what happens when a CEO is cornered and isolated. His dealers in America and Europe are turning against him. His suppliers and shareholders are suing him, and he's pushing our customers away.
And the sham is that he will walk away with a golden parachute of millions and millions of dollars, while American autoworkers are left holding the bag.
"The sham took place this week when he was asked about stepping down or being replaced, Carlos Tavares said, and I quote, 'I signed a contract,'" Fain said. "Well, Carlos, the workers at Stellantis signed a contract too, and it's time for you to honor it."
Calling on UAW members to sign a strike authorization pledge over Stellantis' broken promises, Fain vowed that "we will once again save this company from mismanagement, from corporate greed, and from killing tens of thousands of good jobs."
"But only if we stick together," he stressed. "So, are you in? If you are, sign your strike authorization pledge today. And you can do that by going to shitcancarlos.com."
"Let the company know where you stand," Fain added. "And together, let's tell Stellantis: The days of plant closures are over, and Carlos Tavares needs to go."
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UAW Chief Slams 'Job-Killer-in-Chief' Trump Ahead of Michigan Visit
"Kamala Harris has stood with labor," said Shawn Fain. "She's walked the walk. Donald Trump serves himself. He's always served himself."
Oct 10, 2024
The head of the largest U.S. autoworkers union on Thursday highlighted the yawning chasm between former President Donald Trump's campaign promises to protect the country's auto industry and the 2024 Republican nominee's White House record—which includes hundreds of thousands of lost manufacturing jobs.
Speaking on a call hosted by the campaign for Vice President Kamala Harris, the Democratic nominee, United Auto Workers president Shawn Fain argued that "there is a stark contrast between Donald Trump and Kamala Harris."
"Kamala Harris has stood with labor," Fain said of the UAW-endorsed candidate. "She's walked the walk. Donald Trump serves himself. He's always served himself."
Taking aim at Trump's claims that he's the best choice for U.S. autoworkers and that he's "always had their back," Fain said:
Look at the Lordstown, Ohio assembly plant. [Trump] told workers there, "Don't sell your houses." The plant closed. He came to Warren, Michigan, a week ago or two. Again, wants to talk about how he cares about autoworkers. But we had [General Motors'] powertrain plant in Warren closed under his watch. He did nothing. Trump stood there in 2016 and promised that he wouldn't allow a single plant to close.
However, plant closures and offshoring increased during the Trump administration, during which domestic auto production plummeted from nearly 12.2 million units in 2016, the last full year of the Obama administration, to under 8.2 million units in 2020, Trump's last full year in office, according to the U.S. Bureau of Transportation Statistics. While Covid-19 affected that year's production, fewer than 10.9 million vehicles were manufactured domestically in pre-pandemic 2019.
Fain, who noted this trend, called Trump the "job-killer-in-chief."
The UAW chief also mocked reports that numerous attendees wearing "autoworkers for Trump" T-shirts at a Tuesday rally for the Republican in Detroit weren't actually autoworkers.
"It's pathetic. Everything he does is a con," Fain said of Trump.
Referring to the multibillionaire CEO of electric vehicle maker Tesla, Fain added that Trump "sits there and applauds Elon Musk for trying to fire striking workers, and they laugh about that."
"And that's why I said Donald Trump is a scab," the union leader added, using the term for nonunion workers who cross picket lines during strikes.
During last year's UAW strike for a fair contract, President Joe Biden made history by becoming the first-ever sitting U.S. president to join striking workers on a picket line. Four years earlier, Harris, then a U.S. senator from California running for president, walked a picket line with striking UAW workers in Reno, Nevada.
The Biden-Harris administration has often been called the most pro-labor presidency in modern history.
Fain's remarks came hours before Trump infuriated many Michiganders by telling local business owners at a Detroit rally that if Harris wins, the entire country will "end up being like Detroit"—which is in the midst of an economic revival.
Congressman Shri Thanedar (D-Mich.), who represents the city,
admonished Trump to "keep Detroit and our people out of your mouth."
"Detroit is a city with a booming economy, diverse culture, and some of the best people in America," he said, adding that the heavily Democratic city "will elect Kamala Harris."
Michigan Democratic Party Chair Lavora Barnes said Thursday: "Plain and simple, a second Donald Trump presidency would be a disaster for Michigan workers. His agenda will raise costs and kill jobs."
"When he was president," she added, "Trump gave tax cuts to the wealthy at the expense of Michigan's working families, tanked our economy during the pandemic, and only helped the rich get richer."
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'We'll Be Back,' Says UAW Chief Shawn Fain After 'Tough Loss' in Alabama
Organizers are expected to continue their effort, drawing inspiration from a recent success in Tennessee that followed two defeats.
May 17, 2024
Workers at a pair of Mercedes-Benz plants near Tuscaloosa, Alabama narrowly voted against joining the United Auto Workers this week, according to a preliminary tally on Friday.
As of press time, the UAW webpage had the National Labor Relations Board tally at 2,045 in favor of joining the union (45%) and 2,642 opposed (56%).
Voting at the large facility in Vance and the battery plant in Woodstock kicked off Monday and wrapped up Friday morning. Speaking to reporters Friday evening, UAW president Shawn Fain said that it was "obviously not the result we wanted" but "we'll be back in Vance."
"These courageous workers reached out to us because they wanted justice," Fain said of the Mercedes employees. "They led us. They led this fight, and that's what this is all about—and what happens next is up to them."
"It's a David v. Goliath fight. Sometimes Goliath wins a battle but ultimately David will win the war."
"Justice isn't just about one vote or one campaign, it's about getting a voice and getting your fair share," he continued, noting that "workers won serious gains in this campaign."
Fain added that "it's a David v. Goliath fight. Sometimes Goliath wins a battle but ultimately David will win the war."
The Alabama election followed a UAW win in Chattanooga, Tennessee, where Volkswagen workers last month voted to join the union.
Labor reporter Mike Elk
noted that the "tough loss" in Alabama was "not a blowout," and organizers now have "a solid base that future campaigns can build on like they did at Volkswagen," where winning a union election took three rounds of voting.
The UAW has ramped up organizing in the U.S. South since securing contract victories last year following a "Stand Up Strike" targeting Ford, General Motors, and Stellantis, the American automobile industry's "Big Three."
The Alabama organizing effort has garnered support from progressives and union workers around the world. The Washington, D.C.-based Global Labor Justice said Friday that "we stand with Mercedes autoworkers who are voting to join UAW to better their lives and help end the so-called 'Alabama discount.' It's time we end the U.S. South and Global South 'discounts' that allow corporations to perpetuate a race to the bottom that hurts all workers."
Meanwhile, Republican leaders in U.S. Southern states have shown "how scared they are that workers organizing with UAW to improve jobs and wages," as the Economic Policy Institute put it last month, after Govs. Kay Ivey of Alabama, Brian Kemp of Georgia, Tate Reeves of Mississippi, Henry McMaster of South Carolina, Bill Lee of Tennessee, and Greg Abbott of Texas issued a joint statement accusing the union of coming to their states to "threaten our jobs and the values we live by."
NEW: Right now Mercedes workers in Alabama are voting on joining the @UAW.
One reason workers are voting yes? They know they're building cars that sell for $250,000 and generating billions for Mercedes.
And that they aren't seeing that money. pic.twitter.com/vOnej9ufuO
— More Perfect Union (@MorePerfectUS) May 15, 2024
Mercedes has said that it "fully respects our team members' choice whether to unionize and we look forward to participating in the election process to ensure every team member has a chance to cast their own secret-ballot vote, as well as having access to the information necessary to make an informed choice." However, both employees and the UAW accused the company of union-busting ahead of the vote.
During his remarks to the press Friday evening, Fain charged that "this company engaged in egregious illegal behavior" and pointed to ongoing probes by German and U.S. officials into "the intimidation and harassment that they inflicted on their own workers."
The Alabama facilities are operated by Mercedes-Benz U.S. International, a subsidiary of a German parent company. The UAW said Thursday that Germany's Federal Office for Economic Affairs and Export Control has launched an investigation into worker claims.
"Autoworkers in Alabama should have the same rights and be treated with the same respect as autoworkers in Germany," Jeremy Kimbrell, who has worked at one of the Alabama plants since 1999, said in a statement. "My coworkers and I are grateful to the German government for taking our testimonies and the evidence we have provided seriously and taking the first steps to hold the lawless, reckless Mercedes managers in Alabama accountable for their action."
Mercedes toldQuartz that it "has not interfered with or retaliated against any team member in their right to pursue union representation" and is "fully cooperating with the authorities."
As The Washington Postreported Friday:
Alabama business leaders, politicians, and clergy have also stepped in to warn workers against voting for the union...
In a video posted this week on a Mercedes-run website about the union election, Rev. Matthew Wilson, a pastor and city council member in Tuscaloosa, told workers of the union vote: "This one change I would be careful of... As a lifelong resident of Tuscaloosa, we have come too far to turn around now."
ESPN sportscaster and retired University of Alabama football coach Nick Saban also spoke to Mercedes workers this week. According toAxios, "Saban owns multiple Mercedes dealerships and has reportedly said he does not endorse the UAW's campaign."
Kay Finklea, a Mercedes employee and member of the UAW's voluntary organizing committee, told the outlet that "they don't stop the line for hardly anything, but they shut the line down and they had a meeting with Nick Saban in there to talk to us about teamwork and the tactics and methods he used as a football coach."
The Alabama effort is widely seen as a test case for unionizing more auto workers in the South. Before the results were announced, Harley Shaiken, a labor professor at the University of California, Berkeley, toldReuters that "if the union wins, they improve their momentum dramatically for future organizing."
This post has been updated to correct the reference to Global Labor Justice.
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