The United Auto Workers union intends to begin targeted strikes at specific plants against the big three Detroit automakers if tentative contracts aren’t reached by midnight Thursday, according to union officials.
Targeted strikes would occur at certain General Motors Company (NYSE:GM), Ford Motor Company (NYSE:F) and Stellantis NV (NYSE:STLA, EPA:STLA) plants in that instance, the idea being that the plants chosen would be representative of the overall issues faced by the UAW union.
That’s opposed to a national strike where all UAW members walk out of plants. A national strike took place four years ago as part of negotiations with GM.
The targeted strike plan could change if negotiations progress prior to the deadline, according to reports. A national strike of the union’s 146,000 is still a possibility, according to UAW President Shawn Fain.
Notably, because a targeted strike means fewer workers striking, it costs the UAW strike fund less money. The $825 million strike fund pays $500 per week to workers, which is enough for 11 weeks if everyone were to strike.
That said, strike pay doesn’t include healthcare costs like temporary COBRA plans. Also, in the event of a targeted strike, the automakers could respond by locking out non-striking workers.
Fain is expected to outline the strike strategy to union membership at 5 pm ET in a Facebook Live event.
The UAW has called for a 40% increase in wages across the life of a new contract. Last week, GM offered a new contract that included a 10% increase in hourly wages, Ford offered a 9% general wage increase and Stellantis offered 14.5%.
Ford CEO Jim Farley said late Tuesday night the company is “optimistic that we can reach an agreement with the UAW in the next two days.”
Analysts at Wedbush are less optimistic. The firm called a strike a “potential nightmare” for the automakers in a recent note to clients.
Contact Andrew Kessel at andrew.kessel@proactiveinvestors.com
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