The switch to electric vehicles poses a threat to U.S. union jobs

On the outskirts of Normal, Illinois, there is a factory that exemplifies the challenges facing the American labor movement as the auto industry moves toward electrification.

Former Mitsubishi plant Rivian will next month launch electric vehicles that will begin manufacturing trucks and sport utility vehicles there. It will employ 1,800 next month, with plans to climb up to 2,500 by the end of the year.

Mitsubishi closed the plant in 2015, laying off a unionized workforce that had 4,000 employees at its peak around the turn of the century. Rivian bought the factory for $ 16 million from a liquidator and will launch its first products.

But the factory, while employing some of the same workers, is no longer a union shop and the situation in Normal illustrates the changing dynamics of the American auto industry.

Electric vehicles are recognized as the undisputed future of the industry. Ford and General Motors are investing billions in plans to build electric vehicles while competing against Tesla, which has become the dominant American electric vehicle manufacturer.

The U.S. auto industry is critical to U.S. manufacturing, employing about 390,000 in vehicle manufacturers and 539,000 in the supply chain.

But electric vehicles increase the possibility of job losses for assembly workers and the car’s supply chain. Electric vehicles generally require fewer components, which means they require fewer people to manufacture parts and assemble vehicles.

In addition, fewer jobs in electric vehicles are likely to be union jobs, which tend to offer workers better pay and benefits. Rivian and Tesla are not unionized, nor are there many companies in the electric vehicle supply chain.

A 2020 report from the left-wing Institute of Economic Policy found it unionized workers earned 11.2% more than non-union colleagues. Membership in the United Auto Workers union has declined since it peaked at 1.5 million in 1979, and real wages for vehicle workers have fallen 17 percent since 1990, according to the Bureau of Labor Statistics. United States. The union still represents 400,000 workers, but a research study conducted in 2018 by the UAW said up to 35,000 of these union jobs could happen as a result of the transition to electric vehicles.

“When you look at it, you need fewer people. . . and the supply chain involves more non-union employers, you have a significant potential job loss, ”said Marick Masters, a professor of business at Wayne State University in Detroit.

Rivian declined to comment on unionization at the Illinois plant. In January 2020, the UAW said it hoped “these jobs would return and UAW members would have the opportunity once again to get organized,” but Normal Mayor Chris Koos said who did not believe that any discussion had taken place between Rivian and the UAW.

“Personally, I believe in unions,” Koos said. “They contribute a lot to the table. . . But in this situation, it is a decision between Rivian and the workforce.

While UAW President Rory Gamble has said the need to organize workers for new electric vehicle manufacturers is “a given,” it won’t be an easy task.

Workers at the Tesla plant in Fremont, California, have long been trying to organize through the UAW. More than three years ago, Elon Musk’s company fired Richard Ortiz, who had distributed pro-union pamphlets in the plant’s parking lot, and only this year did the U.S. National Labor Relations Commission rule that his dismissal it was illegal. The board ordered Tesla to hire him for a fee.

Tesla also broke the law by banning employees from talking to reporters, retaliating against another union activist, and engaging in “coercive interrogation” of other supporters, the board said.

He also directly criticized Musk, saying a tweet he sent in May 2018 posed an illegal threat to the compensation of workers who were planning to unionize. Musk wrote that workers could unionize if they wanted to, “but why pay union dues and give up stock options for nothing?”

He was ordered to delete the tweet. As of May 7, it was kept online.

Koos said in conversations with Rivian executives, Tesla executives seemed more open to a unionized workforce.

A bigger hurdle may be the change in the supply chain. Decades ago, the UAWs used their relationships with Ford, GM and Chrysler to unite suppliers. Now, the largest battery manufacturers, Panasonic and LG Chem, are in Asia and electric vehicle suppliers in the US are less likely to be unionized.

GM and a unit of LG Chem have a joint venture that is building factories in Ohio and Tennessee. The Ohio plant will not be unionized initially. When GM announced the Tennessee plant last month, the UAW said the manufacturer had a “moral obligation… To make sure it’s well-paid union jobs like those of its brothers and sisters who make internal combustion ”.

“The UAW will have to be very aggressive in trying to organize these facilities,” Masters said. “At the moment he is being more reactive than proactive. . . They have to look at the full picture of the car parts and say, “What parts haven’t we organized?” and go after them ”.

The UAWs said the shift to electric vehicles presents an opportunity to create high-quality manufacturing jobs, but the United States will need “a strong, forward-looking industrial policy” to get there.

The union is pushing for policies that include the recycling of displaced workers, the creation of “quality jobs” in the construction of a nationwide electric vehicle charging infrastructure, and trade protections for “advanced technology.” vehicles “.

It also wants to change current legislation so that consumer subsidies only apply to electric vehicles assembled in the U.S. The federal government subsidizes the purchase of electric vehicles to stimulate demand for a product that currently comprises 2% of the U.S. auto market. The Joe Biden administration has not commented on the idea so far, but it faces uncertain prospects in Congress.

Meanwhile, the UAW has praised the decisions of U.S. automakers to invest in U.S. factories for electric vehicle technologies and has criticized the decisions to sideline labor from U.S. labor.

For example, Ford said last month that it planned to open a new one battery R&D installation in Michigan, which the union said would “position Ford and UAW members and families to thrive over the next few decades.”

Later that week, GM announced a $ 1 billion investment to build electric vehicles in Mexico. UAW Vice President Terry Dittes called this a “slap” to union members and U.S. taxpayers.

“We need to make sure that we allocate government funding to labor standards and that we make sure the jobs are in the United States,” UAW Legislative Director Josh Nassar said May 5 before a subcommittee of the U.S. US Chamber. “If we don’t. . . there is no guarantee that the automotive jobs of the future will be the good places we are used to. “