The UAW strike against the Detroit 3 automakers isn't finished as I write this column on Oct. 27, but I think we can see the light at the end of the tunnel.
Ford Motor Co. and UAW reached a tentative agreement on Oct. 25 and began restarting operations, but that agreement still must be approved by members. The agreement with Ford could prompt General Motors and Stellantis to quickly reach their own deals. A week ago, I wouldn't have predicted that it would be wrapping up anytime soon.
I've been listening to economists and auto analysts talk about this situation since weeks before the strike started on Sept. 15. At this point, I'm wondering if this is going to have meaningful and lasting impact on the auto industry, beyond the financial results for the OEMs and suppliers in the next quarter or two, or if it will quickly be forgotten.
For example, we've seen the auto sector become a big political issue, probably bigger than when the government had to bail out the industry during the 2007-08 financial crisis. If the strike had happened in the summer of 2024 instead of now, it would have been interesting to see how that issue resonated with voters, especially in some key Midwestern swing states.
Will the presidential candidates still be talking about the auto industry, jobs and the transition to electric vehicles a year from now? And if it is an issue, then who will it benefit? I suspect it won't have a big impact on who wins the next election.
How about the power of unions? In less than a year, Shawn Fain has become arguably the highest-profile UAW president in decades, perhaps second only to Walter Reuther, who held the job from 1946-70.
In the early days of this strike, Fain struck me as a guy who was a fantastic poker player. It looks like he won this hand, using rolling strikes effectively to keep the OEMs off their game. But the UAW can't go on strike every year. Where will Fain be when these contracts expire?
Auto suppliers took a hit during the strike, which is nothing new. Add strike-related work stoppages to the list of issues that suppliers have had to navigate the past few years: a shift to EVs, the pandemic, the chip shortages and other supply chain issues. Suppliers had to deal — yet again — with uncertain and interrupted business. They must be getting good at dealing with adversity.
I've been watching and keeping track of layoffs at factories in the automotive supply chain. Every one of those decisions must have been tough because trained workers are in short supply. If anyone "lost" in this strike, it has to be the suppliers.
The consensus is that the winners in this strike are the Detroit 3's nonunion competitors: Tesla, Toyota and Honda. But I wonder whether their win will last for just a few quarters. To endure, they're going to need to win market share and profits. Once Ford, GM and Stellantis start pumping out those full-size pickup trucks again, I would not bet against them.
Finally, let's not forget consumers. I worry that new vehicles are getting so expensive that only the rich will be able to afford them. Or perhaps it will become a choice between an expensive car payment and an expensive mortgage — not everyone can afford both.
Don Loepp is editor of Plastics News and author of the Plastics Blog. Follow him on Twitter @donloepp.