Auto Industry Economics and the UAW Strike

Announcer: Listener Supported, WNYC Studios.

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Brian Lehrer: It's The Brian Lehrer Show on WNYC. Good morning, everyone. The United Auto Workers strike is becoming a real issue in the 2024 presidential race now. A little bit of recent history to start out and set this up. Remember the financial crisis of 2008, which hit the US auto industry so hard. Mitt Romney, who of course everybody's talking about now for other reasons, would run against President Obama in 2012. He wrote a New York Times op-ed in 2008 with the headline, Let Detroit Go Bankrupt.

The first line read, "If General Motors, Ford, and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry goodbye." Mitt Romney in 2008, but a bailout was approved by Congress, as most of you know, and by that 2012 campaign against Romney, Obama's Vice President, a guy named Joe Biden, was able to say this on the campaign trail.

Joe Biden: Osama Bin Laden is dead and General Motors is alive.

[applause]

Brian Lehrer: Now as part of that crisis in Detroit, auto workers, especially those hired after 2007, took pay and benefit cuts. The city of Detroit, by the way, did go bankrupt anyway in 2013. Romney's headline, Let Detroit Go Bankrupt, was about the companies. The city did go bankrupt, even though its flagship companies got bailed out, but that's another show. Today, the strike against the big three US automakers is premised on the union's argument that the companies are making record profits, and so the workers should get things like a percentage raise, similar to what the CEOs are getting, plus a return to company-backed pensions, not just 401ks and more. Here's what Joe Biden says today.

Joe Biden: Auto companies have seen record profits, including in the last few years, because of the extraordinary skill and sacrifices of UAW workers. Those record profits have not been shared fairly, in my view, with those workers.

Brian Lehrer: Everyone acknowledges, though, that the transition to electric vehicles in response to climate change is a challenge to the big three's bottom line, so Republicans are lining up against climate policy as their main response to the strike and remaining mostly silent on the labor-management issues. We'll play a couple of clips to that effect coming up. Let's try to take a step back, though, and look at the real economics of the auto industry and we'll bring the politics into it too.

With me now, Neal Boudette, auto industry reporter for The New York Times, based in Detroit. Back during the 2008/2009 financial crisis, he led the Wall Street Journal's coverage of the bankruptcies and the federal rescue of General Motors and Chrysler. He also previously was based in Europe where he covered the auto industry there. Yes, this is very much a global story so that background will be helpful to us too in this conversation. Neal, nice to have you. Thanks for coming on. Welcome to WNYC.

Neal Boudette: Pleasure to be here. Thanks for having me.

Brian Lehrer: I want to start by taking us back to the financial crisis of 2008/2009, why did that hit US automakers in particular so hard?

Neal Boudette: Well through really the '60s and '70s, the UAW won a series of negotiations where their pay increased and their benefits increased and by the time you got to the early 2000s, Ford, GM, and Chrysler really were carrying a very heavy burden of labor-related costs. They were paying the cost of health care for retirees and their families and this was a really large number, almost a million. On top of that, they were providing these very rich pensions and were paying the highest wages in the industry.

Opposite them were the foreign-owned automakers, Toyota, Honda, Nissan. They were operating non-union plants in the South where they were paying about half the hourly wage and were not covering these pension and retiree health costs. There was a big disparity and the big three had a really hard time competing. They were losing money leading up to 2007. In the 2007 contract talks, that was where they made a big change. They created a trust fund to cover the retiree healthcare costs and they allowed what they call a second tier of wages.

New hires would come in at about $15 an hour. That was almost a little more than half of what the top UAW wage was at the time, $28 an hour. They could hire new people and over time lower their average wage cost but that was not enough, of course, because then when the financial crisis hit and auto sales plummeted, these companies were still not prepared for that kind of tsunami or economic storm. GM and Chrysler were in such bad shape, they had to be ushered into a government-managed bankruptcy. Ford was a little more forward-thinking and they took out loans and mortgages and lined up liquidity ahead of time so they had enough money to go through under their own power and that's what happened in the financial crisis.

Brian Lehrer: Is there still that divide today by the way between what we call the big three, Ford, General Motors, and what's now Stellantis that they are unionized and Toyota and others making cars in the US are not?

Neal Boudette: The playing field is much more even these days. The big three were able to hire these new hires and bring them in. These days it's about $17 as a starting wage, and the top wage is $32, and it takes eight years to climb from that starting wage up to the top wage. When you average it, the labor costs are pretty close. The big three are all in, including wages and benefits. It costs them about $64 an hour. The transplants, that's the term they use to describe Toyota and Honda and those companies, Volkswagen, they're at about $55 an hour. Then you have Tesla, which also operates a non-union plant in California and Texas and their cost is about $45 an hour. There's a difference there but that still hasn't stopped the big three from reporting very, very strong profits over the last decade.

Brian Lehrer: The government bailout of the industry in the financial crisis, just to continue on this history as we move our way to the present, and listeners we'll open the phones in a minute, how partisan or bipartisan was that? I mentioned the Mitt Romney op-ed, Let Detroit Go Bankrupt.

Neal Boudette: There was a lot of Republican pushback, not just about bailing out the big three automakers, but also the Wall Street banks, because that was an even larger bailout than the automaker bailout was. There was a lot of opposition, but it was that we were in a crisis time and somebody had to do something. We had to take some kind of action. In the end, GM and Chrysler were back on their feet and today it's a totally different picture than it was actually 15 years ago or 14 years ago this year.

Brian Lehrer: Listeners, anyone with current or past ties to the auto industry want to help us report this story? Tell us about yourself as an auto worker if you've been one or maybe a parent or a grandparent who was an auto worker or ask any questions about the real economics of the US auto industry in the context of the UAW strike today or the partisan politics of it, which we'll get into as we go. 212-433-WNYC. Call or text 212-433-9692 or tweet @BrianLehrer for Neal Boudette, who covers the auto industry for the New York Times. We played the Joe Biden clip from now, asserting like the union does that the companies are now making record profits. How true is that?

Neal Boudette: That's pretty close to true. Ford has had some record years in the last 10. The last few years they have been off. They've been trying to bring down their costs but GM has been reporting a pretty strong stream of record or near-record profits. Last year, they earned almost $10 billion a year. Years ago, that would have been unheard of, unthinkable for them to make that much money. Stellantis is doing extremely well. They made $12 billion in just the first six months of this year alone. I wouldn't say Joe Biden was far off from the picture that's out there.

Brian Lehrer: Why is that true? What's been bringing automaker profits back so far after the financial crisis that's now 15 years old? It's one thing to say they survived and are doing okay, it's another thing for an industry to be making record profits.

Neal Boudette: Well, there are several factors at work here. One, obviously, is the lower labor costs that they were able to achieve through bankruptcy and then carry forward to this day. They have a lower cost base. On top of that, over the last 10 years, Americans have really gravitated toward SUVs and pickup trucks. Ford makes the Ford Mustang, but no other passenger cars. GM has dropped the Chevrolet Malibu, they're essentially out of the passenger car business too. Same thing with Stellantis. In those areas, large SUVs, pickup trucks, that's their forte, that's their strength, where they really, really are very, very competitive. The vehicle [inaudible 00:11:17] are best at making and make the most money for them are the ones that are selling now.

Then the third trend is really since the pandemic, we had the pandemic and then that led to this computer chip shortage. The computer chip shortage has lingered on and limited the number of vehicles automakers are able to make. They're making fewer than people are looking to buy. You have a basic supply and demand. The demand for the products outstrips the supply and that has pushed prices of new vehicles up to record highs. We're at just under $50,000 as the average transaction price for a new vehicle these days. That's way up from the mid 30s, just 6 or 7 years ago.

Brian Lehrer: We'll talk in some detail about the challenge of electric vehicles for automakers in the US and why it has to be if people are buying the more expensive cars that they make now, which is to say the SUVs. Why won't they transition to American-made electric vehicles and the companies will make just as much or more? We'll get to that, but have auto worker wages and benefits kept up let's say on a percentage basis with the growth and profits for the shareholders as they've moved into the current record profits era?

Neal Boudette: They've improved, but they have not kept up at the same pace that profits have grown and also have not kept up with inflation. If you go back to 2007, the top UAW wage was $28 an hour. Today the top UAW wage is $32 an hour. That's a $4 increase, but that's more than a 15-year period and in that time inflation has eroded the purchasing power of that kind of wage. No, they have not kept up. That's one of the main arguments the UAW is trying to make here in demanding a significant increase is that our wages haven't kept up, your profits have gone way up, we are slammed by inflation, so we deserve to be brought up to speed.

Brian Lehrer: Listener texts that, "I worked for GM at a Michigan plant during the mid-'80s, during my summers off from college. The money was great at that time and I was able to pay for my college tuition. I was a proud UAW member and I'm grateful for my experience there." Another listener texts a question, "The car companies paid the bailout money back, correct?" Is that correct?

Neal Boudette: Yes, it is. They paid almost all of it back. In the end, the government got quite a bit of its money back. They owned stock in GM for some time. Then GM had their initial public offering again and became a publicly-traded company and eventually the government sold the stock back to GM and they did recoup quite a bit of their money.

Brian Lehrer: Here's David in Yonkers calling in with I think some skepticism toward the union demands. David, you're on WNYC. Hello.

David: Hi, how are you gentlemen? I have a background in automotive technology from Daytona Beach, which is the number one school in the country. My father was a patent attorney and engineer. He actually went to Japan every year for about two and a half decades. He trained the lawyers in Nissan and I have friends in the automotive industry.

Unions can be good. I was in one, food one when I worked for A&P, but they can also be bad. I think the problem is companies have let unions run over them. I'm sorry to say this, and people won't agree, of course, I think they're being paid way too much in the automotive industry. Now I'm a consultant in the health industry and I contacted the president [unintelligible 00:15:33] to show him how I can save them millions in their health and enhance their coverage and just really lower premiums and a lot of free other values they get free. Don't even want to hear it. It's not just him, it's other unions like teachers unions. I've contacted the flight attendants I talked to a couple years ago.

I wrote to Biden and I told him a guaranteed starting point 350 million a year in federal employees and lowering premiums and they just aren't interested. As a former HR director, I wonder who's putting these people in charge? I've been a consultant for three governments and billion dollar companies around the world [inaudible 00:16:17]

Brian Lehrer: David, I'll ask you a couple of follow-up questions. One, when you say the auto workers are being paid too much, we just heard from Neal that the top wage is $32 an hour, times 40 hours a week, times 52 weeks a year, that's only $66,000 top wage. For an auto worker, I presume that's regardless of seniority, it's not a lot of money, right?

David: For putting windows and doors on a car and putting the engine in or the drive train, yes, it's a lot. I've done that type of work. It's a lot of money. Actually you guys know the answer. My brother told me last week, Biden went to some organization, I think last year or this year and he had a clip, he told them, I saved your pensions and they all applauded. My brother said it was an outright lie. I don't know if you know what I'm talking about.

Brian Lehrer: Well, because their pensions-- I don't know what Biden said, I know that pensions are an issue in this strike. They want to return to traditional pensions, not just 401Ks. David, give us a one line, if you can, version of what the way is that you say you've got to save the companies and governments so much money on health care premiums without diminishing the coverage of the workers.

David: I've worked with about a dozen carriers. There's one in particular I designed a hospital indemnity plan that goes beyond the standard confinement rule. 90% of the claims comes from outpatient surgery and diagnostic procedures. If you have as much a slip on a banana peel in the middle of the street, you're going to get reimbursed for costs. To say thank you, we're the largest enrollment company in the country. We can do their health care and other carriers. We can do the enrollment free and it keeps the HR from being tied up. We offer them free [unintelligible 00:18:19] their life insurance, they have free-tuition benefit program, legal coverage, [unintelligible 00:18:26]

Brian Lehrer: I get it, it's a package. David, I'm going to leave it there and I appreciate your call. Thank you very much. I don't know, Neal, if it's a matter of public opinion that I would frame the follow-up question to that call around. Do people think $60,000 as a top salary is a lot of money? When you say $32 an hour is the top salary, is that really the top salary for somebody who has been working in an auto plant for 20 years, 30 years?

Neal Boudette: Yes, it is. That's the top wage. It does come up to $67,000 a year if you're working eight hours a day, five days a week. A lot of these workers do put in overtime so they're able to bring home more than that over the course of the year. Of course, then you're working six days a week. That's actually a big complaint from the UAW in this is the hours that people are required to work. There are plants where people are working 6 days a week, 10 hours a day, and putting in 60 hours a week. Yes, they're getting paid $32 an hour, but the UAW complaint is that then these people don't have a life. They're missing their kids' soccer games and family events and so on and so forth. One thing, Shawn Fain, the UAW President has said is work-life balance is not only for management but it's for all workers. I think he has a point there. As far as whether the UAW is making a lot of money, I would say in some states, in some places around the tree, the minimum wage is $15 an hour, and the starting wage for a new hire at an auto plant is $17 an hour. That's producing a product that on average sells for about $48,000. Sometimes these pickup trucks, large SUVs sell for $60,000, $70,000 a piece. You're creating a product that generates a lot of profit making $2 above minimum wage. If that's an acceptable wage, you can make your own judgment on that.

Brian Lehrer: I don't want to turn the rest of this segment because we have so much more historical and current economics and politics ground to cover. I don't want to turn the whole rest of this segment into a response to David's call, but the texts are pouring in. One listener writes, "When was the last time David made $66,000? He's clueless." Another one writes, "It is truly mind-blowing to hear people talk about overpaying workers while the executives make multimillion-dollar salaries. Why is that acceptable?"

Since David was talking about healthcare, a listener had written, "Most foreign auto companies have in their home country's national healthcare which reduces the company's costs. Not a balanced comparison." We will leave that exchange there. We will take a break. We'll come back with Neal Boudette, who covers the auto industry for the New York Times, and we'll bring the EVs conversation into it. Apparently, the transition to electric vehicles is challenging for the auto companies. It is a big issue in the auto workers' strike. It's becoming a big issue between Democrats and Republicans on how they respond to this strike. We'll place some clips. We'll take more of your calls. 212-433-WNYC. Stay with us.

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Brian Lehrer on WNYC. We're talking about the economics and politics of the auto workers' strike. They're threatening to walk out of more plants. So far it's been just one of each of the three big automakers. More plants beginning Friday. If there isn't enough progress in the talks, we'll see if that comes to pass. Our guest is Neal Boudette, auto industry reporter for the New York Times based in Detroit. Again, a little background on him. Back during the 2008/2009 financial crisis, he led the Wall Street Journal's coverage of the bankruptcies and the federal rescue of General Motors and Chrysler.

He also previously was based in Europe, where he covered the auto industry there. This is very much a global story. We'll talk about how China comes into it and more as we go. We're taking your calls and texts at 212-433-WNYC or tweet @BrianLehrer. Neal, let's talk about where EVs come into this. You've reported that the automakers are investing tens of billions of dollars in electric vehicles, but have yet to see significant sales or profits from them. The union is concerned that the transition could cost thousands of jobs because EVs are cheaper to produce than gasoline-powered cars. Can you explain that last part first? Why are they cheaper to produce?

Neal Boudette: Because there are a lot fewer parts. There's no transmission, there's no fuel system, no exhaust system. It doesn't take as many workers to assemble them as it does a gasoline-powered car that has all these other components.

Brian Lehrer: Are they also cheaper to maintain? This is just a tangent, but based on what you just said, is the transition threatening the auto mechanic industry as we know it?

Neal Boudette: I do think, yes, that's an issue there too. They are. You don't need oil changes, for example. Your transmission is never going to freeze on you. You're not going to have a leak in the fuel system or a leak in your gas tank. There are repair issues that are going to go away.

Brian Lehrer: May be good for the owners I guess, who won't have as many repairs to pay for over the life of the vehicle. What guarantees regarding the EV era are the unions asking for in the current strike?

Neal Boudette: They want some protections or some measures they can take to discourage the automakers from closing plants. One of them is, under the current contract and the way it's been for a long time, is they're not allowed to strike over a plant closure. They want to have that ability to go on strike if a company is going to close a plant. They're also asking for, they call it a job security program. What they want is that if a plant closes, the company keeps the workers on the payroll.

They don't say for how long but they want to keep them on the payroll and allow them to do community service in their community because they're trying to make the point that when a plant closes, the town that it's in, suffers a lot of economic pain and damage. These are the measures they're talking about to try to really dissuade the automakers from closing down plants wholesale.

Brian Lehrer: This might lead to skepticism on some people's part. Wright is saying, "Wait, they're negotiating for a company that's making less money because of the transition to keep jobs that aren't needed anymore?"

Neal Boudette: Yes. That's what they're saying. Years ago they did have something like that. In 1984, they put in something that was called the jobs bank, and that's how it worked. When plants closed, the automakers kept the workers on the payroll at most of their salary. They didn't make cars but they had to report for work. They literally sat in a room and read books and played board games. At the time the automakers thought this was going to be a temporary thing. They would just do it for a year or two.

They would restructure and downsize and become much more competitive and then need to rehire these workers. Of course that didn't happen and it dragged on for a good 20 years before they eliminated the jobs bank.

Brian Lehrer: Stephanie in Florida is calling in about the EV issue. Stephanie, you're on WNYC. Hello.

Stephanie: Hi. Thanks for taking my call. Brian, I just want to say I'm a New Yorker but even when I travel I got to listen to you guys. It's great.

Brian Lehrer: Aww, thanks.

Stephanie: Anyway, just two things maybe I was hoping he could expand upon. I'm as you would say, thoroughly unscientific. I heard this on another story, is the distinction between non-union and union states and how that ties into EV production, because Tesla's in all non-union states, and I just keep thinking there has to be a more subtle or nuanced way to move forward with all this in so far as the future is EV. The second thing related to EV I've always wondered is, the EVs are cheaper to make but they're more expensive to repair. I've heard this from friends who've bought EVs.

I've always thought that the unions would be smart to try to take control in some way or capitalize on increased EV repair expertise, not just building the cars but repairing them. Then thirdly and then I'll go, I've been surprised at the lack of emphasis or inclusion of, here we go again, the compensation of the C-suite, very handsome, expanding. Mary Barra has paid herself really nicely since the last car industry crisis, and no one's talking about that either and it's just a little surprising to me. On those three points, I'm curious what your guest has to say. Thank you.

Brian Lehrer: All right. Great questions. On that last point, we played a Biden clip earlier on the CEO compensation. Here's Bernie Sanders the other day at a union rally.

Bernie Sanders: It is totally reasonable for auto workers to finally receive a fair share of the record-breaking profits that their labor has produced.

Brian Lehrer: You established before, Neal, that by many measures, it is record-breaking profits that the automakers are making right now. To Stephanie's question on that, and also to her question on how the auto workers might transition into repair specialists in some cases, I guess we said before that they might be cheaper to maintain for owners because you don't need oil changes, some repairs may not happen as frequently, but she's saying they're also more expensive to repair. Maybe that's true in other ways.

Neal Boudette: I think in some cases that's true of all cars these days because they're so electronic. They've got computer chips in them, and jewel sales, you've got to replace it and that automatically is several hundred dollars as opposed to years ago, you might have a hose break and you could get that installed in the park cost $9 or something. EVs are heavily electronic and the repairs on certain components can be very expensive.

On the issue of CEO pay, I'll just say that last year, Mary Barra, she's chief executive of General Motors, her total compensation package was $29 million. Over the last four years, she's made over $100 million. CEO compensation in many industries is very high. Compared to the tech or Wall Street sectors, she's making less than many others, but whether that's a fair amount for her, I'll leave that off to your listener to decide.

Brian Lehrer: Well, certainly for people who talk about fair ratios from the top person at a company to the bottom person at a company, you were just talking about $17 an hour for new auto workers, which I don't know, what is that? Thirty-something thousand dollars a year, up to $29 million. I can't even do the ratio math in my head on that one. Let's see. Stephanie, did we leave one of your questions on the table? Was there one we didn't answer?

Stephanie: No, maybe just the issue of-- I was just curious, the non-union versus union states and where Tesla builds the cars. It just seems to me that the union somehow they're playing checkers, they need to play chess on these issues of, "Okay, where's the work done? This whole EV transition and how can we control or be included in that?" I just feel like we're at some point where when we look back five years from now, we're going to look back and say, "Well, what it could or should have anticipated where things are going and not just proverbially next year, but the next tomorrow."

Brian Lehrer: Really interesting Stephanie. Neal, do you want to take that on? We do see that the strikes are happening at plants in Michigan, Ohio, and Missouri. Very traditional auto company states.

Neal Boudette: Yes, that's true. There is a concern on the union's part about where new EV plants [inaudible 00:32:55]. GM is building one in Tennessee. Ford is building one in Tennessee, two in Kentucky. The other companies have gone to other right-to-work states in the South. Toyota is building one in North Carolina. Kia and Hyundai are in Georgia, their battery plant. There are a few going into Michigan. GM is building one outside of Lansing and Ford is building one about 50, 70 miles west of Detroit, in Michigan. Stellantis is building a battery plant in Indiana. The traditional auto states are getting some of these battery plants, but the majority of them have been going to right-to-work states in the South.

Brian Lehrer: Is there anything the union can do about that? They could argue all they want for better-paying wages at the union plants, but then if the industry is shifting to non-union states or so-called right-to-work states where even if you are unionized, the power that you have is weaker, then it's almost moot.

Neal Boudette: That's one thing that they're fighting for is they want to make sure that at least the big three battery plants in right-to-work states become unionized. GM built one in Ohio. It's a joint venture so it was not covered under the UAW contract. The workers there on their own have had their own vote, and they did vote overwhelmingly to join the UAW and they are actually negotiating their own contract right now in parallel with the national contract talks that are going on and involve this strike.

Brian Lehrer: Listener texts, "EVs are less expensive to maintain and not any more expensive to repair and much cheaper to run." Another listener writes, "Community service did not work well in the Linden, New Jersey GM plant. No community service was actually done. Your guest is correct when he said workers would show up and play board games all day." Another listener writes, "Folks down south have all voted down unions."

Now the main Republican talking point on the strike as they avoid the issues of corporate greed or concentration of wealth at the top, or the decline of the middle class generally in terms of wages and benefits in this country, as they avoid all that, they argue that the Biden administration's climate policies are the real enemy. Here's Donald Trump, for example.

Kristen Welker: My question for you, Mr. President, whose side are you on in this?

Donald Trump: I'm on the side of making our country great. The auto workers are not going to have any jobs when you come right down to it because if you take a look at what they're doing with electric cars, electric cars are going to be made in China. The auto workers are not going to have any-- I'll tell you what, the auto workers are being sold down the river by their leadership, and their leadership should endorse Trump.

Brian Lehrer: Trump asked by Kristen Welker on NBC's Meet the Press, which side are you on in this strike? That was his answer. Can you give us, Neal, some economics of the Biden EV incentives that are in the Inflation Reduction Act, the climate bill passed last year, and their implications for the automakers?

Neal Boudette: Sure. They're making available billions of dollars in mostly loans to the automakers to build battery plants and other EV component production sites in the United States. Ford recently got about $9 billion from the federal government to build its battery plants. GM has gotten its own some, less than that, however, but these incentives that they have offered are part of the reason that has brought the foreign automakers to build battery plants in the South. As I mentioned, Toyota is building one in North Carolina and Kia and Hyundai in Georgia. These incentives do seem to be bringing manufacturing jobs to the United States, EV-related manufacturing jobs.

Brian Lehrer: Republicans keep coming back to the argument in this context that the EV policies from Biden benefit China. [inaudible 00:37:36] in the short term?

Neal Boudette: I'm not seeing how that benefits China. China is the world's largest auto market. That country produces more EVs than any other country in the world and they have their own policies to drive that, but I don't see how the policies in the United States as they are now are pushing EV production to China. As I said, Ford is building four battery plants, two in Kentucky, one in Tennessee, one in Michigan. They're building a new EV truck plant in Tennessee. GM is building a battery plant in Tennessee, another one in Ohio is underway. Another one in Michigan. Chrysler is building a battery plant in Indiana and they're looking for a site for a second one. These companies are certainly charging ahead and putting production into the United States.

Brian Lehrer: Well, can the conversion to EVs avoid being another race to the bottom like we've seen in other aspects of the globalized economy if China is competing with us in this space and paying workers much less?

Neal Boudette: That's one concern of the UAW that if you are going to pay people $17 an hour, as I said, in some places that's $2 more than the minimum wage. They're concerned and they use that term all the time, race to the bottom. That's what they say this fight is about. Shawn Fain talks about that all the time. He broadens it and says that they're fighting for the broader working class, not just the UAW because if the UAW wins a very good contract for them, it will push nudge wages for workers in other industries and in other auto locations up as well.

Brian Lehrer: Adam in South Orange is going to be our last caller in this segment. Adam, you're on WNYC.

Adam: Hi, how are you? I was just wondering, is there any issue that the auto workers are expressing with respect to fear of job losses owing to technology or AI? Does that have anything to do with the strikes that they're concerned not only with their wages but about whether they'll be able to maintain their jobs?

Brian Lehrer: Good. AI, like in the writers and actors' strikes and so many other industries, is that an issue in these talks?

Neal Boudette: Well, they're certainly concerned about job losses in the transition to EVs. I don't think AI in particular specifically has come up yet, but they are concerned that it requires fewer workers to produce EVs than traditional vehicles. The UAW has put out some white papers on this and calculated the potential job losses that could happen. These are not baked in. These are not definitely going to happen, but they are very concerned about the job losses.

Brian Lehrer: Other Republicans are going even further than Trump on how to respond to the strike. Here's Tim Scott also running for president, Senator from South Carolina, recalling the time that Ronald Reagan as president fired air traffic controllers for striking and says that should happen here. Listen to this.

Senator Tim Scott: I think Ronald Reagan gave us a great example when federal employees decided they were going to strike. You strike, you're fired. Simple concept to me to the extent that we could use that once again, absolutely.

Brian Lehrer: "Simple concept to me we should use that again, absolutely." How widely shared is the Tim Scott fire the strikers position? How widely shared in the GLP?

Neal Boudette: I don't know how widely shared that is, but we do have labor laws that allow for labor unions and the right to strike. In the case of the air traffic controllers, that was almost 40 years ago. Those were federal workers and they had specific terms where they were not supposed to strike. That's different than all workers today where we do have a national labor relations board and labor laws that allow for unions and allow for striking.

Brian Lehrer: How diverse is the UAW membership today? In the old days, I'm sure it was overwhelmingly white.

Neal Boudette: It's more diverse than the general population. There are large numbers of African-Americans in the union in both the rank and file and in the hierarchy. The past two predecessors to Shawn Fain were African-American. They have had an African-American leader in the past. It is pretty diverse. How that compares to other unions, I'm not really sure, but as I said, it's more diverse than the general population as a whole.

Brian Lehrer: To end on this political question, we've seen the white working class migrate over time from being more pro-Democrat to being more pro-Republican. I wonder if you've covered how or to what degree that has happened in the UAW over time and how the current presidential race as it's shaping up with respect to this issue seems to be a tug of war for the hearts and minds of what we might call broadly the working-class, at least as represented by the UAW membership.

I think what we've been laying out here is the Democrats are saying, "Yes, you are striking against your bosses. Their greed is the issue like you say." The Republicans are saying nothing about the alleged greed of the bosses and they're saying blame climate change policy. I realize you're an auto industry reporter, not a political reporter, but are we headed for a major clash in 2024 in which climate-saving policies are used by the Republicans to try to keep the loyalty of the especially white working-class as more their enemy than concentration of wealth and capitalism?

Neal Boudette: Correct. I am not a political reporter, but I can say this, that the rank and file of the UAW does have a significant portion who have been voting Republican. Back in the '80s when they talked about Reagan Democrats in Michigan, that was the white working-class auto worker. The question this time around is with regards to the union, which has for decades endorsed Democratic presidential candidates, whether the union leadership can persuade the rank and file to vote more in favor of the Democratic candidate than the Republican candidate.

I did talk to Shawn Fain about this very issue several weeks ago, and he's aware of it. The union has not yet endorsed Joe Biden, but he knows that in the end, they're either going to have to endorse him or tacitly endorse him because when the Trump administration was in power, the National Labor Relations Board really became an adversary for unions and an active ally of employers. Shawn Fain does not want to go back to that, and especially since they have plans of, if they do well in this strike, maybe they can start unionizing some of the plants in the south.

In the past, they've had votes and lost at Volkswagen and Nissan, and they've tried to unionize a Mercedes plant. A lot is hanging in the balance and the union leadership definitely knows they're much better off going down the road if Joe Biden wins a second term than if Donald Trump gets in for a second term.

Brian Lehrer: Neal Boudette, auto industry reporter for the New York Times, thanks so much for today. We really appreciate this.

 

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