Why Stellantis could face a longer strike than Ford or GM


Demonstrators during a United Auto Workers (UAW) practice picket outside the Stellantis Mack Assembly Plant in Detroit, Michigan, US, on Wednesday, Aug. 23, 2023.

Jeff Kowalsky | Bloomberg | Getty Images

The United Auto Workers labor union launched targeted strikes against the three Detroit automakers early Friday morning. The stoppages affect three plants that make popular models such as the Ford Bronco, Chevrolet Colorado and Jeep Wrangler.

It’s the first time in history that the UAW has struck all three of the Detroit automakers at once. But while the strikes began at the same time, they may play out very differently in the days to come — with Stellantis potentially facing a tougher road to a deal than its crosstown rivals Ford Motor and General Motors.

Stellantis has a problem that its local rivals don’t. The company formed by the merger of Fiat Chrysler Automobiles with French automaker Peugeot in early 2021 has more capacity than it needs around the globe. The company has about 35 factories and distribution centers in the U.S. now. The company has a total of about 35 factories and parts distribution centers in the U.S. now.

That’s a plan that the union is unlikely to accept willingly.

It’s possible that Stellantis has been preparing for a lengthy strike with that in mind: The company had more vehicles in its U.S. dealer inventories at the beginning of September than either of its crosstown rivals.

The auto industry measures inventory in terms of “days’ supply,” based on the rate of sales of each model over the previous 30 days. Cox Automotive data shows that all four Stellantis U.S. brands have more than 100 days worth of inventory on dealer lots and in transit. The average industry supply was 58-days at the start of September. Historically, the Detroit automakers have tended to have somewhat larger supplies on hand because their full-size pickups are offered in many different configurations.

In contrast to the strike against Stellantis, the UAW’s strike against Ford could be relatively brief. Ford’s executives and UAW President Shawn Fain made comments in recent days that suggested Ford was close to reaching a settlement with the union. It is possible that the UAW recognized this when they chose to strike just a part of Ford’s Michigan Assembly Plant – where vehicles are painted, and final assembly takes place. Last night, all UAW-represented employees at GM’s Wentzville assembly plant, as well as Stellantis Jeep Wrangler Factory in Toledo, Ohio walked out.

Michael B. Thomas | Getty Images News | Getty Images

General Motors may also be spared a protracted strike. Details made public from GM’s final offer before the strike, on Thursday, suggested that its offer was similar to Ford’s, with a 20% wage increase over the four-year term of the contract, more vacation days and two weeks of parental leave, among other concessions.

If Ford reaches agreement with the UAW soon, GM could follow soon after by using Ford’s deal as a template.

But as of Friday morning, Stellantis seemed to be buckling down for a long battle.

“We are extremely disappointed by the UAW leadership’s refusal to engage in a responsible manner to reach a fair agreement in the best interest of our employees, their families and our customers,” the company said in a statement following the walkouts. Stellantis said in a statement following the walkouts that it was “extremely disappointed” by the UAW leadership’s refusal to engage in a responsible manner and reach a fair agreement for our employees, their families and our customers. In accordance with previous practice, following a strike the UAW will take a weekend break from negotiating. The meetings are expected to resume over the weekend.