It was disclosed on October 30, 2023, that General Motors (GM:US) and the United Auto Workers (UAW) association have come to a preliminary agreement following a six-week strike by the union. Comparable agreements were also made with Ford (F:US) and Stellantis (STLA:US) prior to this.
The strike, which commenced back on September 15, was aimed at reaching a better labor contract. The strike was aimed at Detroit’s ‘Big Three’ automakers: General Motors, Ford, and Stellantis.
On October 25, the UAW had reached a deal with Ford. The latter - the first to present an alternative proposal to the union - agreed to a 25% hike in hourly wages over the course of the contract. Including cost-of-living allowances, the highest wage rate is projected to go up by 33%. F’s stock price has fallen by 29.07% since day one of the strikes.
Three days later, Stellantis also settled with UAW and on October 30, General Motors agreed, bringing the strikes to an end. General Motors, like Ford and Stellantis, also agreed to a 33% in workers’ pay in addition to paying $2,500 in installments to retirees until 2028. UAW President Shawn Fain commended the workers in a video address. It was finalized that local leaders of the UAW will gather in Detroit on Friday to review the agreement with GM before presenting the terms to all union members for approval. GM’s CEO Mary Barra was reported as saying, “We are looking forward to having everyone back to work across all of our operations.”
While the UAW has achieved its purpose post this six-week period, several experts believe the rise in costs will severely impact the automakers. Worries existed that an extended strike could harm the U.S. economy and affect Biden's likelihood of being re-elected in 2024.
U.S. President Joe Biden was very vocal in his support for UAW, even going as far as becoming the first sitting POTUS to visit a picket line in history. His support is joined by both parties in Congress as well.
In Congressional trading, four sales of GM stock were reported by Rep. Ro Khanna’s spouse and child, trading from July 19 until Sept 27. Ford stock was sold by four lawmakers from May to August and On August 22, Rep. Michael Burgess bought between 15,000 - 50,000 worth of Stellantis shares, when the stock closed at 18.09 per share.