I don’t know about you, but I’m getting pretty tired of all the villains who dominated the headlines in 2023, starting with Donald Trump. Aren’t there any heroes out there? I can think of at least one: Shawn Fain, president of the United Auto Workers.
Nobody in the public maelstrom had a better 2023 than Fain. In March, he won an upset victory to become president of the scandal-plagued UAW, pledging to end a string of “concessions, corruption, and plant closures.” In September, just a half-year later, Fain initiated a series of escalating strikes against General Motors, Ford, and Stellantis (formerly Chrysler)—the first strike ever conducted against all three. By Halloween, Fain had won contracts at all three with pay hikes of 25 percent (more than 33 percent when you factor in cost of living increases, which were restored for the first time since 2009); a 10 percent increase in company contributions to workers’ 401(k) plans; and new commitments to bring electric vehicle and battery workers into the UAW contracts. By Thanksgiving, the union rank and file had ratified the contract.
Fain made “audacious” demands on management, inviting a certain amount of thin-lipped disapproval. “Labor and political leaders are doing workers no favors by setting expectations so sky-high that, if they actually get everything they want, they might end up putting their employers out of business,” complained The Washington Post’s Catherine Rampell on September 19. “This increasingly militant UAW is overplaying its hand with an overly lengthy and overly ambitious list of demands,” scolded Steve Rattner, car czar to the Obama administration during the Great Recession, one day later in The New York Times. “I don’t think there’s any way the automakers will be able to meet these conditions.”
Rampell and Rattner are intelligent commentators whose analyses are usually sound, but in this instance, they lost sight of how a negotiation works. A union that gets everything it asks for is a union that didn’t ask for enough. You maximize bargaining leverage by seeking more than you can get, forcing your adversary to give up more ground than he intended. So, for example, when Ford offered a 15 percent pay hike in August, Fain rejected that and pressed for 40 percent. That’s how Fain got 25 percent.
Did the Big Three give up too much? Two weeks into the strike Jeff Windau, an analyst at the investment company Edward Jones, predicted to Business Insider that Detroit would have to “sacrifice some of their buybacks in the near term” to absorb costs imposed by whatever deal they reached with Fain. Boo freaking hoo! After the deal was struck, The Wall Street Journal’s Mike Colias predicted “difficult times ahead for the Detroit Three.” Two weeks after workers ratified the General Motors contract, GM—financially the shakiest of the Big Three—said the deal was going to cost it $9.3 billion over the next five years, adding $575 to the price of every GM car. Then, in its next breath, the company announced it would piss away an additional $10 billion through stock buybacks. Either GM can well afford to pay autoworkers $9.3 billion more or its management is psychotic; I don’t see a third possibility. (GM is also boosting dividends by 33 percent.)
What about nonunion companies like Tesla and Toyota? “Foreign automakers operating in the United States (Toyota, Hyundai, etc.) pay their workers about $55 per hour all in,” Rampell observed in September. “Tesla is estimated to pay workers somewhere in the mid-$40s. In other words, the legacy manufacturers are already at a significant cost disadvantage compared with their biggest competitors.” Yes, Fain is well aware of that. So one week after the Big Three agreement was ratified, he initiated an organizing drive at the 13 nonunion car companies that operate in the United States, including Toyota, Honda, Volkswagen, BMW, and Tesla. These companies employ about 150,000 workers or slightly more than are represented by UAW. If Fain organized all of them, he could double the number of workers covered by the October agreement.
Even before Fain launched his organizing drive, Honda and Toyota responded to the Big Three contracts by hiking pay 11 percent and 9 percent, respectively. “We’ve shown the world,” Fain says in a rousing organizing video posted on the UAW website,
that this industry is harming workers and consumers to the benefit of company executives and the rich, and it’s time that the working class did something about it. But it’s not just the Big Three. It’s across the auto industry. CEOs are raking in billions while autoworkers’ real wages are falling.
Fain then goes on to say that the Japanese and Korean automakers “made nearly twice as much as the Big Three in the past decade ... with over 40 percent of their revenue coming from their North American operations. Don’t autoworkers at Toyota, Honda, Hyundai, Nissan, Subaru, and Mazda deserve a record cut of those record profits?” Good question! During that same period, Fain said, BMW, Volkswagen, and Mercedes Benz “made almost the same as the Japanese and Korean companies ... Do Volkswagen, BMW, and Mercedes workers not deserve their fair share of this booming auto industry?”
Of course, this will be an uphill battle. Many nonunion auto factories are situated in the South, which traditionally has been hostile toward labor unions. When the UAW tried to organize a VW plant in Tennessee in 2014, VW management stayed neutral—but the state’s Republican political establishment, led by then-Senator Bob Corker and then-Governor Bill Lee, campaigned furiously against it; even Grover Norquist got into the act, and the union vote failed. A second attempt subsequently failed in 2019, as did efforts to unionize Nissan plants in Tennessee and Mississippi. When workers tried to organize Tesla’s assembly plant in Fremont, California, Chairman Elon Musk threatened on Twitter to withhold workers’ stock options (“Why pay union dues and give up stock options for nothing?”), prompting the National Labor Relations Board to cite Musk for committing a labor violation. (Labor violations don’t get more clear-cut.) Tesla appealed, and the case has been making slow progress in the courts. In the meantime, Musk’s offending tweet remains posted on Twitter, now renamed X and owned by Musk.
Already, though, Fain seems to be making headway. In a December 11 video, Fain said that workers at VW’s Chattanooga plant had, “in less than a week,” collected more than 1,000 union cards, representing about one-third of the plant’s workers. That’s enough to compel an NLRB union vote, but Fain is setting two additional benchmarks: If the Chattanooga plant workers collect cards from 50 percent, he’ll stage a rally there, and if they get to 70 percent, he will then ask VW for voluntary recognition or force an NLRB-supervised vote. Fain’s following the same strategy at other nonunion plants. He wants to see a strong show of support before the companies get to work on dissuading workers.
Meanwhile, the UAW filed unfair labor practice charges against VW and also against Honda and Hyundai. It’s charging that VW management restricted discussion and distribution of union materials, that Honda management ordered workers to remove union stickers from their hats, and that Hyundai confiscated union materials. (Honda and Hyundai deny the charges, and VW says it’s investigating.)
It’s customary, after a victory such as the UAW enjoyed with the Big Three strike, for a leader to spend at least a little while resting on his laurels. One could hardly blame Fain for doing so. But that doesn’t appear to be his style. I would be not at all surprised to see Fain roll up additional victories in 2024 by organizing nonunion autoworkers, expanding the UAW, and spreading the wealth. Fain is even, the Financial Times reported December 13, urging unions in other industry sectors to time their contract expiration dates to coincide with the UAW’s, preparing the ground for American labor to one day stage a general strike. Shawn Fain does not think small. He’s a marvel and an inspiration.
