The recently negotiated labour agreements with General Motors, Ford Motor, and Stellantis have set new benchmarks, including a substantial 25% increase in base wages for unionised workers. This boost includes an immediate 11% hike and will ultimately result in a cumulative 33% increase in the top wage, reaching over USD 42 per hour when factoring in estimated cost-of-living adjustments.
Additionally, the agreements eliminate wage tiers within factories and significantly reduce the time required for workers to reach the top wage—from eight years to just three.
In response to the UAW’s victory, the union has launched a social media campaign named the “UAW Bump,” encouraging non-union workers to consider joining the UAW. The focus has now shifted toward foreign-owned auto plants, including those operated by Tesla.
Biden administration supports UAW’s expansion efforts
President Joe Biden has shown support for the UAW’s efforts to unionise additional carmakers, endorsing the push for fair compensation and improved working conditions across the industry.
Automakers respond with pay hikes
Several car manufacturers have swiftly responded to the UAW’s success by implementing pay increases for their non-union workforce. Here is a roundup of the companies taking action:
Tesla plans to raise wages by approximately 10% for specific set-rate hourly workers at its battery factory in Sparks, Nevada, starting early January. There are also reports suggesting streamlining of worker levels.
Volkswagen is set to increase pay by 11% for non-union production workers at its Chattanooga assembly plant in Tennessee, effective December 2023.
Nissan Motor will implement a 10% wage increase for workers at its U.S. manufacturing plants in January, impacting approximately 9,000 U.S. employees. The company is also eliminating wage tiers for U.S. production workers.
Hyundai Motor will raise wages for nonunion production workers at its Alabama factory by 25% by 2028, affecting 4,000 hourly workers.
Honda Motor will grant production workers at its U.S. facilities an 11% pay hike starting in January and will reduce the time it takes factory workers to reach the top-wage tier to three years from six.
Toyota is raising wages for its nonunion U.S. factory workers, with hourly manufacturing workers at top pay receiving a wage hike of about 9% effective January 2024.
Subaru will raise the wages of its U.S. plant workers in Lafayette, Indiana. However, the exact amount of the raise is yet to be determined.
As automakers adjust their compensation policies, the ripple effect of the UAW’s landmark deals continues to reshape the landscape of wages and working conditions within the U.S. automotive industry.