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Auto industry wonders whether Ford-SK battery plants will sport the union label By Reuters


© Reuters. FILE PHOTO – The Ford logo was pictured in Genk (Belgium) December 17, 2014. REUTERS/Francois Lenoir


By David Shepardson and Ben Klayman

WASHINGTON/DETROIT (Reuters) – The plan for Ford Motor (NYSE:) Co and Korean battery partner SK Innovation to build three battery plants in the United States, announced this week, will prompt a furious drive by labor leaders to organize the plants, potentially setting the tone for future union drives at auto industry factories in the U.S. South.

United Auto Workers, which represent approximately 150,000 hourly workers, at U.S. General Motors Co. (NYSE:), Ford, Stellantis NV parent Stellantis NV is trying to advocate for those working at battery plants. Ford must ensure that battery plant workers are well-paid union jobs according to the leaders of unions.

This is important as the location of most job growth in the auto industry is built around electric cars and batteries. The UAW could lose its membership if it strikes in Ford-SK, as fewer people buy gasoline-powered cars.

UAW enjoys strong allies in Washington. U.S. President Joe Biden called for U.S. carmakers to strengthen their relationship with the union. House Democratic leaders are proposing an additional $4,500 worth of retail incentives to U.S. made electric vehicles.

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Elon Musk (NASDAQ:) Inc), chief executive at EV leader Tesla, made the suggestion that the Biden administration is controlled by unions in EV policy.

Kristin Dizzek, Center for Automotive Research economist, stated that unions have experienced a significant increase in public support. However, organizing new UAW plants is proving difficult. The majority of these new plants are in states that have been resistant to unions, like western Tennessee, where the new Ford trucks and battery plant will be constructed.

“It is going to be a challenge and one that will test the new leadership of the UAW” to organize the new truck assembly plant, Dziczek said. The UAW would win the organization of the battery plants.


The clock is ticking for the UAW, in which membership has declined sharply over the decades. UAW President Ray Curry, who attended a Ford event in Tennessee on Tuesday to celebrate the company’s plan to build new electric F-150 assembly and battery plants there, said the union is “eager to work with Ford to continue to assure the culture of manufacturing high-quality vehicles and components for their customers.”

Lisa Drake (North American chief operating officer for Ford) told Reuters that it was up to workers to choose whether they wish to be represented in “any environment”.

She quickly stated, however that Ford is America’s largest employer of UAW members and has requested that SK refrain from taking an anti-union stance in relation to joint-venture batteries plants in Tennessee, Kentucky.

Biden’s government supports the union.

Brian Deese, White House National Economic Council Director tweeted Tuesday: “Ford’s investment in union jobs and wages is starting to show that this approach pays off.” Ford does not claim that these jobs will become unionized. It is open to workers in all cases to express their support for organizing.

GM will be facing similar pressures for its U.S.-based battery plants that it built with LG Energy Solution, a unit from Korea’s LG Chem.

The number one U.S. automaker. Although the No. 1 U.S. carmaker originally believed that workers had the right to choose whether or not to unionize, it later supported the UAW’s efforts to organise those plants.

This issue will be the topic of contract negotiations between UAW and Detroit’s Big Three automakers. The current agreement, which is for four years, expires in 2023.

As it unsuccessfully tried to organize factories like the Volkswagen AG (OTC) in Tennessee, and other foreign plants, the union is pushing for this.

Rory Gamble, the then-President of UAW, called for GM to allow union representation in new joint venture EV factories.

In the past, UAW has criticized GM over announcing a $1B investment in Mexico to create EVs. Union rights in Mexico are much weaker than those in Ohio. Ford was also criticised for building EVs more in Mexico.