Looks like the UAW union has an Ace up their sleeve: Bottleneck Strike
Here's how a UAW strike against the Detroit 3 could play out
The UAW has warned it could strike all three Detroit automakers at once, but it also could target key production sites to avoid burning through its $825 million strike fund.
Never in the UAW's 88-year history has it attempted a national strike at each of the Detroit 3 simultaneously.
But that unprecedented — and economically devastating — scenario remains in play as contract negotiations with the automakers enter a critical post-Labor Day stretch, with UAW President Shawn Fain declining to pick a traditional target company.
A mass walkout of nearly 150,000 workers would give Fain, who has a penchant for theatrics, the kind of headline-grabbing moment he often seeks. But it would rapidly deplete the UAW's $825 million strike fund, a fact not lost on members who have publicly questioned whether the union can sustain a simultaneous strike long enough to strong-arm the automakers into better deals.
POTENTIAL BOTTLENECK STRIKE TARGETS
A potential UAW strategy against the Detroit 3 is a bottleneck strike, which halts production at key sites, forcing other plants to close. Here are some potential sites.
Ford Motor Co.
At $500 a week per member — potentially plus health care costs — the union has a few months' worth of strike pay on hand.
"Let me assure you, the VPs, myself, all the leadership at this level, the bargaining committees, we understand how to manage this," Fain said in response to a worker's question on the issue during a Facebook livestream in early August. "We have a plan. Come Sept. 14, if these companies don't deliver, they're going to see that plan unfold."
While a UAW spokesperson declined to discuss the union's strategy, Fain this week declared that "everything's on the table."
That includes a strategic bottleneck strike that halts production at key sites, forcing other plants to close.
"With just a few plants, you could have a pretty substantial impact to profitable vehicles without having that many employees walk," Jeff Schuster, executive vice president of GlobalData, told Automotive News.
Such a tactic would limit what the union would have to pay out on the picket line since workers at plants shuttered for parts shortages would not get strike pay. But it could be fraught with legal risk, and people familiar with the matter say non-striking workers who get temporarily laid off would not be eligible for supplemental unemployment benefits from the automakers, and eligibility for traditional unemployment pay could vary based on state laws.
Still, a bottleneck strike could be effective.
The most famous example occurred at two General Motors plants in 1998, where a few thousand workers in Flint, Mich., ultimately took down about 30 other GM assembly plants and 100 North American parts plants for almost two months. The strike cost GM some $2 billion.
A similar bottleneck strike occurred in 1996, when a walkout at two plants in Ohio forced GM to shutter virtually all operations.
Potential targets
If the union were to stage a bottleneck strike at all three companies, targeting engine or transmission plants could be more advantageous than going after one or two high-margin pickup or SUV assembly plants because the parts facilities employ fewer workers and typically supply multiple products.
At Ford Motor Co., Livonia Transmission in Michigan would be a prime target.
That high-volume site makes gearboxes for vehicles including the F-Series, the company's most profitable nameplate. Lima Engine and Cleveland Engine in Ohio, where workers build engines for high-margin pickups and SUVs, also would be key production chokepoints.
At Stellantis, a stoppage at its Kokomo Transmission Plant could paralyze much of the automaker's North American manufacturing. The Indiana plant produces gearboxes for Jeep, Dodge and Ram models as well as machined components for nine-speed transmissions across the lineup. BREAKING NEWS ALERTS: Sign up and be the first to know when big news breaks.
A Jeep engine plant in Dundee, Mich., would be another impactful location.
At GM, Romulus Powertrain in Michigan would be a high-risk site, as it supplies V-6 engines and 10-speed transmissions for vehicles including the Chevrolet Silverado and GMC Sierra.
In Ohio, GM's Toledo Propulsion Systems, which builds transmissions for combustion vehicles and drive units for electric vehicles, also would be a target, as would the Marion Metal Center in Indiana, which produces sheet metal-stamped parts for multiple plants to support Chevrolet, GMC, Buick and Cadillac vehicles.
Legal risks
The UAW would have to tread carefully if it calls a strike in specific locations only.
Individual locals are allowed by law to strike only over issues specific to those locals, not companywide matters. GM in 1998 filed a lawsuit against the UAW claiming its bottleneck strike was illegal, arguing that the two plants struck over issues that could be resolved only in national negotiations, which were to happen the following year.
Experts say the issue of what exactly an individual plant would be striking over could play a role in potential legal challenges.
Another major issue would be what compensation workers receive. In a typical layoff, workers receive roughly 95 percent of their usual pay through a combination of state-level unemployment benefits and payments from the companies.
Some experts say that workers laid off as a ripple effect of a bottleneck strike wouldn't be eligible for supplemental payments from the company. That could leave a majority of union workers in a worse financial position than those actually on strike, who would be getting $500 a week from the union.
Supplier strike?
Another tactic that almost certainly would draw lawsuits: striking at supplier plants.
Even that is not without recent precedent. Unifor workers in 2019 walked off the job at an Inteva Products plant and a Lear Corp. plant near Oshawa, Ontario, causing production to briefly stop at GM's Oshawa plant that was slated to close.
Ontario's labor relations board ruled Unifor's supplier strikes illegal and barred it from using the tactic. The union's president at the time, Jerry Dias, struck a defiant tone, saying Unifor was "not a union that's afraid of injunctions."
In the U.S., the National Labor Relations Act bars unions from going after an employer through a strike at another company.
"That's a very bad idea," said L. Steven Platt, an attorney at Howard & Howard in Chicago specializing in labor law. "Going after non-Big 3 entities is not a wise thing to do, and it will draw litigation."
He said any legal missteps by the union could complicate its strike goals.
"The one thing you don't want to do if you're the union is make a mistake," Platt said. "If you're going to use a strike as a weapon, you don't want to have the risk that the labor board forces you back to the bargaining table."
Unfair labor practices
The UAW may already be setting the groundwork for another tactic: an unfair labor practice strike.
The union last week filed charges with the National Labor Relations Board accusing GM and Stellantis of "refusing to bargain in good faith over mandatory subjects of bargaining including but not limited to wages and benefits."
In this case, the union could call a strike over those allegations instead of tying a work stoppage over wages and economic issues. If the union calls an unfair labor practice strike, companies are prohibited from hiring permanent replacement workers, as employers sometimes do to keep plants running and potentially intimidate those on strike.
"This is a preemptive strike, before a strike," said Art Wheaton, a labor relations expert at Cornell University. "If GM and Stellantis had hopes of hiring permanent replacements to starve out the UAW, [the union] can say, 'Sorry, you can't do that.' "
Economic impact
If the UAW decides to take on all three automakers at once, economists say a strike of any length could be financially disastrous. The UAW's 2019 strike against GM, which lasted 40 days, cost the company $2.9 billion and 300,000 vehicles of production.
Anderson Economic Group recently projected that a 10-day strike against the Detroit 3 would result in more than $5 billion in economic losses.
Baird Equity Research estimated that a simultaneous strike could last at least six weeks and put 800,000 vehicles of production at risk.
If a strike at all three companies lasted 100 days, GlobalData has projected that production of 1.5 million vehicles would be lost.
"That's painful; there's no way around it," GlobalData's Schuster said. "The Detroit 3 could potentially weather it, but I don't know about the impact on the supply base. It could be ugly."
Here's how a UAW strike against the Detroit 3 could play out
The UAW has warned it could strike all three Detroit automakers at once, but it also could target key production sites to avoid burning through its $825 million strike fund.
Never in the UAW's 88-year history has it attempted a national strike at each of the Detroit 3 simultaneously.
But that unprecedented — and economically devastating — scenario remains in play as contract negotiations with the automakers enter a critical post-Labor Day stretch, with UAW President Shawn Fain declining to pick a traditional target company.
A mass walkout of nearly 150,000 workers would give Fain, who has a penchant for theatrics, the kind of headline-grabbing moment he often seeks. But it would rapidly deplete the UAW's $825 million strike fund, a fact not lost on members who have publicly questioned whether the union can sustain a simultaneous strike long enough to strong-arm the automakers into better deals.
POTENTIAL BOTTLENECK STRIKE TARGETS
A potential UAW strategy against the Detroit 3 is a bottleneck strike, which halts production at key sites, forcing other plants to close. Here are some potential sites.
Ford Motor Co.
- Livonia Transmission Plant, Michigan: 6R/10R/8F35/8F40 transmissions, service components
- Lima Engine, Ohio: 3.3/3.5/3.7-liter TiVCT Duratec V-6 engines, 2.7/3.0-liter EcoBoost V-6 engines
- Cleveland Engine No. 1, Ohio: 2.0/2.3-liter EcoBoost I-4 engines, 3.5-liter EcoBoost V-6 engines
- Kokomo Transmission, Indiana: 850R/850RE GEN2 transmissions, machined components for 9-speed/SIEVT transmissions
- Dundee Engine, Michigan: 2.4-liter I-4 Tigershark engines
- Romulus Powertrain, Michigan: HFV6 engines, 10-speed transmission
- Toledo Propulsion Systems, Ohio: rwd 6-speed/8-speed/10-speed transmissions, fwd 9-speed transmission, EV drive units
- Marion Metal Center, Indiana: Sheet metal stamped parts
At $500 a week per member — potentially plus health care costs — the union has a few months' worth of strike pay on hand.
"Let me assure you, the VPs, myself, all the leadership at this level, the bargaining committees, we understand how to manage this," Fain said in response to a worker's question on the issue during a Facebook livestream in early August. "We have a plan. Come Sept. 14, if these companies don't deliver, they're going to see that plan unfold."
While a UAW spokesperson declined to discuss the union's strategy, Fain this week declared that "everything's on the table."
That includes a strategic bottleneck strike that halts production at key sites, forcing other plants to close.
"With just a few plants, you could have a pretty substantial impact to profitable vehicles without having that many employees walk," Jeff Schuster, executive vice president of GlobalData, told Automotive News.
Such a tactic would limit what the union would have to pay out on the picket line since workers at plants shuttered for parts shortages would not get strike pay. But it could be fraught with legal risk, and people familiar with the matter say non-striking workers who get temporarily laid off would not be eligible for supplemental unemployment benefits from the automakers, and eligibility for traditional unemployment pay could vary based on state laws.
Still, a bottleneck strike could be effective.
The most famous example occurred at two General Motors plants in 1998, where a few thousand workers in Flint, Mich., ultimately took down about 30 other GM assembly plants and 100 North American parts plants for almost two months. The strike cost GM some $2 billion.
A similar bottleneck strike occurred in 1996, when a walkout at two plants in Ohio forced GM to shutter virtually all operations.
Potential targets
If the union were to stage a bottleneck strike at all three companies, targeting engine or transmission plants could be more advantageous than going after one or two high-margin pickup or SUV assembly plants because the parts facilities employ fewer workers and typically supply multiple products.
At Ford Motor Co., Livonia Transmission in Michigan would be a prime target.
That high-volume site makes gearboxes for vehicles including the F-Series, the company's most profitable nameplate. Lima Engine and Cleveland Engine in Ohio, where workers build engines for high-margin pickups and SUVs, also would be key production chokepoints.
At Stellantis, a stoppage at its Kokomo Transmission Plant could paralyze much of the automaker's North American manufacturing. The Indiana plant produces gearboxes for Jeep, Dodge and Ram models as well as machined components for nine-speed transmissions across the lineup. BREAKING NEWS ALERTS: Sign up and be the first to know when big news breaks.
A Jeep engine plant in Dundee, Mich., would be another impactful location.
At GM, Romulus Powertrain in Michigan would be a high-risk site, as it supplies V-6 engines and 10-speed transmissions for vehicles including the Chevrolet Silverado and GMC Sierra.
In Ohio, GM's Toledo Propulsion Systems, which builds transmissions for combustion vehicles and drive units for electric vehicles, also would be a target, as would the Marion Metal Center in Indiana, which produces sheet metal-stamped parts for multiple plants to support Chevrolet, GMC, Buick and Cadillac vehicles.
Legal risks
The UAW would have to tread carefully if it calls a strike in specific locations only.
Individual locals are allowed by law to strike only over issues specific to those locals, not companywide matters. GM in 1998 filed a lawsuit against the UAW claiming its bottleneck strike was illegal, arguing that the two plants struck over issues that could be resolved only in national negotiations, which were to happen the following year.
Experts say the issue of what exactly an individual plant would be striking over could play a role in potential legal challenges.
Another major issue would be what compensation workers receive. In a typical layoff, workers receive roughly 95 percent of their usual pay through a combination of state-level unemployment benefits and payments from the companies.
Some experts say that workers laid off as a ripple effect of a bottleneck strike wouldn't be eligible for supplemental payments from the company. That could leave a majority of union workers in a worse financial position than those actually on strike, who would be getting $500 a week from the union.
Supplier strike?
Another tactic that almost certainly would draw lawsuits: striking at supplier plants.
Even that is not without recent precedent. Unifor workers in 2019 walked off the job at an Inteva Products plant and a Lear Corp. plant near Oshawa, Ontario, causing production to briefly stop at GM's Oshawa plant that was slated to close.
Ontario's labor relations board ruled Unifor's supplier strikes illegal and barred it from using the tactic. The union's president at the time, Jerry Dias, struck a defiant tone, saying Unifor was "not a union that's afraid of injunctions."
In the U.S., the National Labor Relations Act bars unions from going after an employer through a strike at another company.
"That's a very bad idea," said L. Steven Platt, an attorney at Howard & Howard in Chicago specializing in labor law. "Going after non-Big 3 entities is not a wise thing to do, and it will draw litigation."
He said any legal missteps by the union could complicate its strike goals.
"The one thing you don't want to do if you're the union is make a mistake," Platt said. "If you're going to use a strike as a weapon, you don't want to have the risk that the labor board forces you back to the bargaining table."
Unfair labor practices
The UAW may already be setting the groundwork for another tactic: an unfair labor practice strike.
The union last week filed charges with the National Labor Relations Board accusing GM and Stellantis of "refusing to bargain in good faith over mandatory subjects of bargaining including but not limited to wages and benefits."
In this case, the union could call a strike over those allegations instead of tying a work stoppage over wages and economic issues. If the union calls an unfair labor practice strike, companies are prohibited from hiring permanent replacement workers, as employers sometimes do to keep plants running and potentially intimidate those on strike.
"This is a preemptive strike, before a strike," said Art Wheaton, a labor relations expert at Cornell University. "If GM and Stellantis had hopes of hiring permanent replacements to starve out the UAW, [the union] can say, 'Sorry, you can't do that.' "
Economic impact
If the UAW decides to take on all three automakers at once, economists say a strike of any length could be financially disastrous. The UAW's 2019 strike against GM, which lasted 40 days, cost the company $2.9 billion and 300,000 vehicles of production.
Anderson Economic Group recently projected that a 10-day strike against the Detroit 3 would result in more than $5 billion in economic losses.
Baird Equity Research estimated that a simultaneous strike could last at least six weeks and put 800,000 vehicles of production at risk.
If a strike at all three companies lasted 100 days, GlobalData has projected that production of 1.5 million vehicles would be lost.
"That's painful; there's no way around it," GlobalData's Schuster said. "The Detroit 3 could potentially weather it, but I don't know about the impact on the supply base. It could be ugly."
