President Joe Biden added an additional layer of precedent to the already historic strikes that the United Auto Workers union undertook against the Detroit three automakers — General Motors (GM) -), Ford (F) -) and Stellantis (STLA) -) — in walking the picket lines alongside striking workers Sept. 26.
The union began a series of rolling strikes against all three automakers Sept 15. These strikes were expanded Sept. 22 to impact all parts distribution facilities for GM and Stellantis. Ford, owing to the company's willingness to work at the negotiating table, was skipped over in the expansion.
Related: Top analysts explain the real winner of historic UAW strikes (it's not the workers)
The union is seeking 40% wage increases in addition to a 32-hour work week, cost of living adjustments and an expansion of benefits. Automakers have offered 20% increases over a four-year period, but have largely remained inflexible on the other demands.
Beyond telling the striking auto workers that they "deserve the significant raise you need,” Biden, when asked if members deserve the 40% raise that they are demanding, said: "yes."
Some economists have estimated that the strikes could have an enormous impact on the U.S. economy, costing the country some $5 billion over the course of 10 days, an amount that could spike the longer the strikes go on. Analysts, meanwhile, have noted that, regardless of the details of an eventual deal, the true winner in the strikes is Tesla (TSLA) -).
"While the Detroit stalwarts battle with the UAW, there’s a bottle of champagne that’s being iced at Tesla headquarters," Wedbush's Dan Ives said earlier in September.
Related: Former Ford CEO has harsh words of advice for UAW union strikers
Elon Musk, Tesla's chief executive, seems to agree.
"They want a 40% pay raise *and* a 32-hour workweek," Musk wrote in a post on X, the social media platform he purchased last year. "Sure way to drive GM, Ford and Chrysler bankrupt in the fast lane."
In March, a federal appeals court found that Tesla, whose workers are non-unionized, illegally fired an employee attempting to organize unionization efforts. The court additionally found that Musk, a vocal union opponent, illegally threatened workers' stock options in a tweet.
"My bottom line: While the Big Three will be forced to pay more for labor, they cannot afford it," Deepwater Asset Management managing partner Gene Munster wrote earlier in the month. "It will give Tesla more room to keep prices low which should result in negative EV margins for the Big Three for the next two-plus years."
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