It’s being widely reported that the United Auto Workers are going to present Detroit automakers with an “audacious” plan to try to recoup wages lost to inflation and concessions made during the Great Recession. A union fight is nothing new, but what’s new is the leadership of the UAW, run by a guy who is giving real “uncle” vibes.
If you’re not into labor stuff we’re going to talk about the blisteringly hot Indian SUV market and Fisker’s not-so-hot production plans.
Uncle Shawn Doesn’t Have Time For Your Nonsense
If you’re lucky, you’ve got both kinds of uncles in your family: The Uncle who helps you get into trouble and the Uncle who helps you get out of that trouble. The former is the one who buys you the illegal fireworks and shows you how to mount a Roman Candle launcher to your Jeep. The other guy shows up to explain to the cops that this was a physics projects and promises that you’ll definitely help replant that ficus.
Shawn Fain, the man who was elected to lead the United Auto Workers before perhaps their most pivotal negotiation in century, feels like the second kind of Uncle. A former electrician from a then-Chrysler plant in Indiana, Fain ran against the long-entrenched incumbent UAW administration as someone who wasn’t going to pretend to fight and then rollover. He won, barely, and so far he seems to be sticking to his guns.
If you’re really bored you can watch the video above of Fain, in a livestream, laying out the reasons why he thinks UAW workers deserve more compensation, which are, essentially:
- Automakers are posting record profits.
- They’re saying they’re using those profits for the EV transition.
- They’re actually using some of these profits for share buybacks, special dividends, and executive compensation.
- With the incoming EV transition, labor demands more protections for future job losses, et cetera.
Perhaps it’s because I grew up in anti-labor Texas, but my sense of what a UAW leader should be is a boisterous, aggressive, Jimmy Hoffa type and I cannot quite wrap my head around Fain’s tough-but-fair high school physics teacher mood. The real telling bit in all of this is in the video above when Fain complains that he worked as a national negotiator, only to have the UAW President and UAW President’s Office make a backroom deal with the companies. He says, quite clearly, that he’s not going to do that.
More details will surely come out this week, but Automotive News has a preview of the ask, which includes:
The gains would include a 20 percent raise upon ratification, followed by 5 percent raises each year of the four-year deal, according to the people, who requested anonymity discussing the negotiations.
General Motors seems, to some degree, on board with wage increases, but has issues with other demands (the end of two-tier worker pay, the return of Cost-Of-Living-Adjustemnts, et cetera). Here’s a statement they made in response to Fain’s video:
The breadth and scope of the Presidential Demands, at face value, would threaten our ability to do what’s right for the long-term benefit of the team. A fair agreement rewards our employees and also enables GM to maintain our momentum now and into the future. It’s an exciting time to be part of GM, as our entire manufacturing team can benefit from leading in the EV transformation. We think it’s important to protect U.S. manufacturing and jobs in an industry that is dominated by non-unionized competition.
You can hear the subtle implication that more cars could surely be built in non-union places, which most foreign automakers are currently doing.
I don’t know where this ends up and, surely, both the UAW and automakers will have to each find ways to bend and compromise to make a deal. That’s the nature of negotiation.
But is Detroit ready for this guy and his volunteer JV baseball third base coach schtick? I’m not so sure. I’m wondering if Detroit automakers aren’t going to start missing the older, corrupt generation of UAW leaders.
UPS Workers Avoid A Strike
I’ve got a buddy who is a UPS driver, and the talk over the last few months was over who was going to strike longer: the UPS/Teamsters union (of which he is a member) or the Writers Guild of America (of which I am a member). Well, we know how that worked out, because the WGA and SAG-AFTRA are now on strike and UPS workers, it seems, have avoided one.
From Reuters:
The tentative deal covering 340,000 Teamsters-represented workers at United Parcel Service (UPS.N) averted a threatened strike that could have wreaked havoc on the U.S. economy by disrupting about a quarter of the nation’s parcel shipments.
In a meeting in Washington on Monday, Teamsters local leaders voted 161-1 for the deal. The agreement would raise wages for all UPS workers, provide another paid holiday, end a two-tier wage system for drivers and add air conditioning to new models of the company’s ubiquitous brown trucks, according to the Teamsters.
Teamsters know how to strike and are not afraid to get active, so it’s interesting to see that the UPS/Teamsters workers union (arguably, the best organized and most effective union in the United States), managed to avoid a showdown. Is this a recognition from corporations that it’s better to make a quick deal than risk rocking a boat that’s currently full of gold? Is this a result of historically low unemployment? Will this help the UAW? Questions, questions, questions.
Indian Carmaker Profits Way Up In Q1
We don’t talk about India often, though it’s a huge and important growing car market.
Mahindra & Mahindra, one of India’s biggest automakers (along with Tata and Maruti-Suzuki), saw profits nearly double with a year-over-year quarterly increase of 98%. Here’s the skinny from the The Economic Times:
Auto major Mahindra and Mahindra on Friday has reported a standalone net profit of Rs 2,774 crore for the quarter ended June 2023, up 98% from Rs 1,404 crore clocked in the last year period.
The profit beat the ET Now Poll estimate of Rs 1,923 crore.
It’s not the only company doing well. Maruti-Suzuki saw profits up by nearly 250% and Tata saw its quarterly balance sheet improve from a loss in 2022 to a profit in Q1 of 2023. Where’s this money coming from? Obviously, the easing of supply chain woes is helping all automakers, but it’s particularly an increase in Indian purchasing power that’s leading to to consumers picking up SUVs.
From The Deccan Herald:
Sales of utility vehicles (UVs) have also outpaced overall passenger vehicle (PV) sales growth so far this year. UVs generally cost two to three times more than compact cars or sedans. Their sales grew around 18 per cent in the quarter to June, compared to a 9.4 per cent rise in sales of PVs.
Man, now I want a RWD Mahindra Thar (pictured).
Fisker Is Making Money, But Not Making Vehicles Fast Enough
The Fisker experiment is an interesting one, as the EV carmaker isn’t actually making cars. Instead, it’s been outsourcing production to Magna Steyr, the Austrian arm of Canadian supplier giant Magna. How’s that going?
Fiskerati did a dive through the company’s Q2 guidance and found a pretty steep reduction in planned production:
[D]uring Q2 2023, Fisker produced 1,022 vehicles, and in July, they produced 1,009 units, which had fewer working hours due to the planned Magna Steyr annual summer shutdown. The calendar 2023 production forecast was updated to a range of 20,000-23,000 units due to a short-term capacity constraint at one supplier. This new guidance, down from 32,000-36,000 units, assumes support from Fisker’s suppliers and partners to meet this volume and ramp up production.
That’s pretty bad, but at least Fisker is making and selling cars.
The Big Question
Has anyone actually seen a Fisker Ocean on the road? A Lucid Air? A VinFast?
I see a number of Lucid Airs (?) around me, maybe one or two a day (Sierra foothills of northern CA). I usually see a half dozen Rivians a day (mostly trucks but a few SUVs) and Teslas have become more common than Camrys!
There’s a Lucid Air near me, and it’s gorgeous.
Think Fisker has been starting to do press demos with the Ocean.
I believe Matt Farah drove a “prototype”-level only (not production build quality) and in summary, he said on the most recent TST Podcast that he and Fisker agreed it would be best for them to give him a production vehicle to review because no one (him, viewers, Fisker) would benefit if he reviewed what he was given to drive.
Ouch.
The UAW can fuck itself.
For better and for worse, the USA runs on cars and car-centric infrastructure. Most people in this country can’t work unless they have access to a car. If we Thanos-snapped all cars out of existence the country would freaking collapse. The criticality of auto workers cannot be overstated.
They deserve to be paid a comfortable living wage same as anyone else who works to support themselves.
I’ve seen a few Lucids in WI, probably the same number of Rivians. No Fiskers or VinFasts, though.
I haven’t seen any of these in the wild. I did see a Lucid at SEMA last year. I also thought I would see one in Chicago when I was there in May but no dice. I was actually surprised at the lack of upscale vehicles I saw. Usually Michigan avenue has tons of them but I only saw a Ferrari and that was it.
The UAW’s biggest problem is they’re tied to the brands that continue to fade away and are totally unwelcome in the “transplants” and startups. They couldn’t even get back in to Tesla Fremont which had been UAW under GM and Toyota for decades. I’d be interested to know how many UAW members are actually auto workers, I think most these days are healthcare and government workers.
No Ocean Air here in Cornsville. I did see one of the OG Karmas running around a few years ago. A Bolt here and there, a Volt here and there, a couple of Mach-Es seem to be floating about. I’ve seen at least three different Rivians, which surprised me a bit. A bunch of Teslas exist around here which is kind of amazing since the closest Supercharging station is over 40 miles away. Last, but not least, someone on the North end of town still rocks a silver Cadillac ELR. I love seeing that out in the wild – it’s a shame they didn’t build more of those (at a lower price).
I wanted a used ELR until I saw what they (still) cost.
Haven’t seen any of those in the wild, but I did see an old (new?) Morgan out and about today.
Driving home from work one night, I saw two Lucids within a couple of mins. One gray, one white, so definitely different ones. I semi-regularly see one or the other on other evenings, so they are apparently both owned by folks living near my workplace.
No Fiskers or Vinfasts yet. I did see an Ionic 6 a few weeks back.
I am usually pretty open-minded to see issues from different perspectives (e.g., from both a worker perspective and a shareholder perspective), but I just cannot come up with anything positive to say about stock buybacks.
Obviously from an employee perspective, stock buybacks are seen as a waste of money that could go to better pay, better benefits, or a better employee experience.
But even from a shareholder perspective, it’s just smoke and mirrors. Yeah, the buybacks will give a boost to the stock price, but doesn’t mean that the company is in a better position. Pour that money into research & development or something, but putting it into buybacks makes me feel like a company is trying to trick its shareholders into thinking that it’s doing better than it really is just by virtue of a rising stock price.
If I recall correctly, stock buybacks were illegal until the Reagan presidency. They should be illegal again.
As I get closer and closer to 40 years old, and I’m starting to understand/care about the world around me more and more, I’m constantly blown away by how much damage Reagan did to this country.
I voted for Reagan and, if current trends continue, by Christmas I’ll be waving a red flag and carrying a torch.
Try being gay in the middle of the AIDS epidemic when he was President. Evil personified.
Ditto.
Reassuring to have the special relationship with the UK, eh? Almost every aspect of the current British shitshow has its roots in the Thatcher government.
I’m a few years older than you, as a little kid in the 80’s we thought “Ronnie Ray-Gun” was cool and was going to beat the “Ruskies”. Little kids are dumb. One of the worst presidents ever, right up there with GW Bush.
That wouldn’t be surprising. The Reagan admin really screwed up America.
No, they were always legal, what happened in 1981 was the Dutch auction process was legalized, prior to that, stock buybacks had to be done exclusively by fixed price tender
I stand corrected, thanks for the clarification. Reagan still sucks though.
Besides the mainstream makers, I’ve seen a good number of Rivians (my neighbor even has one), a few Lucids, no Vinfasts or Fiskers.
It’s hard to believe that outsourcing the entire production of a car can be done competitively. You’re essentially rebadging someone else’s car. They’ve presumably already priced their profit margin into it, so what’s left for you?
No, yes, and no, respectively.
Magna Steyr isn’t a car manufacturer in the traditional sense.
It’s probably easier to think of them like one of the many factories in china.
A company wants to produce a widget. They’ve already designed and covered a lot of the costs that would go into bringing a new widget to market. They just need someone who can produce the widget to their specs.
Magna Steyr does that, but with cars. So Magna is pricing to cover their production costs, costs that go into setting up a manufacturing line, and potentially offering some other design assistance that will make production easier/cheaper/etc, but they don’t have to cover any of the other costs traditionally priced into the MSRP of a car, like engineering/design R&D, marketing, etc.
It’s also useful that the cars they’re contracted to produce are very high cost models, so there’s already a higher margin built in that can be split.
Karmann used to do production for a number of manufacturers, and Valmet made Boxsters and quite a few other cars. For that matter Audi built the 924s and 944s. I wonder if maybe Porsche and MB can put enough downward pressure on what they pay, like Apple does, that it’s more the producers who are at risk than the primes.
I see a *ton* of EVs in Colorado. I haven’t seen any Fiskers or Vinfast, but Lucids for sure. Rivian and the Volvo EVs might as well guided missiles aimed directly at Colorado, so you see exactly as many as you’d expect.
Teslas are the most common, though the gap has been noticeably closing over the last few years. I also see a fair amount of the less-competitive EVs. The Toyota Busy Forks, Subaru Solterra, Lexus (hold on, gotta google that one) RZ 450e, Mini Cooper SE, Jaguar I-Pace, and Kona EV are much more common than I predicted. Mercedes’ EQ line is doing well out here (better than Lucid), and BMW even moreso. The Bolt is unsurprisingly all over the place, usually with younger drivers. The Nissan Ariya is a surprise hit. I see almost as many of them as VW ID.4s these days, and I have to give them props for having fun paint colors — Northern Lights Metallic is green in some light and purple in others. Hyundai and Kia EVs are common, though every Ioniq 5 I’ve seen has dirt stuck to the rear windshield. The Ford
MustangMach-e is about as common as all the Hyundai and Kia EVs combined, but the F150 Lightning is much less common than the Rivian R1T.I keep hearing about a ginormous inventory of cars that the automakers have stashed somewhere, so I’m guessing they are ready.
I hope the UAW does well and the 32=40 thing sounds like a good idea.
I’ve actually driven an R1T, friend of my sister works for them, so that was pretty cool. I see them more and more now, saw an R1S finally this week. We have the EDV’s everywhere here.
I’ve seen three Lucids, they are pretty. I wish they had better exposure because I want them to make it. But then I love oddball brands.
I’ve yet to see a VinFast, and doubt I will anytime soon, since I live in the Midwest. Have not seen an Ocean yet, but have seen a few of the old Fiskers and at least one of the new Karmas.
You didn’t ask, but I also drove a Think City once, and against all odds spotted a completely different one in the wild.
I live in Metro Detroit and have seen one Fisker Ocean on the roads, but it had a manufacturer plate.
Smaller than I expected…
I hope the UAW gets everything they want. There’s always money for stock buybacks, but f*ck the workers, amirite??
Big congrats to the Teamsters and UPS I love seeing labor win out over the corporate f*cks.
Another ask of the UAW is a 4 day, 32 hour workweek, with the same total pay as 40 hours. I’ve been reading a lot about this premise, and I’ve been preaching it at my own (non-union) manufacturing employer. The UK completed a big study of this earlier this year and had great results. Productivity, engagement, efficiency, and even profit increased, while retention and recruiting improved, reducing turnover and absenteeism. I’ve actually got our site president on board, however convincing our corporate overlords will not be easy. I think if the UAW can make it work, that will hopefully be the start of a bigger trend and push towards this. The fact that automotive is our biggest market is even better.
The 40 hours pay for 32 hours may look like getting an extra day’s pay for free, but the point is that productivity has increased so much that “40 hours'” worth of work IS getting done in 32 hours, in a lot of places. We have a 40hour workweek here, and a lot of that time is spent just waiting out the clock. We could get the same amount of work done in 32 hours for sure.
I only do 32 hours of work in a 40 hour week.
So the solution is… Only make me work 32 hours but pay me for 40.
I promise I’ll do 32 hours of work in 32 hours. Pinky promise.
Re: the 32-40hrs thing, back in the day when I was working for AT&T, the company asked the workforce through our union if they would like to work the same 40hrs/week, but in 4 days (4days x 10hrs instead of 5days x 8hrs).
When the response came back overwhelmingly positive (almost 80% of us wanted the 4×10 schedule), the company shut down their own proposal; when the union asked WTF??, their reply was “too many people liked it”. I swear I’m not making it up, we asked the union higher-ups to show us the written memo.
tldr: I sure hope the UAW gets most of what they’re asking for, and then it will eventually trickle down even to those brain-washed anti-union folks in ‘right-to-work’ states, who don’t understand how any of this works and how it benefits them as well in the end
Also see NYNEX in the 1990s…
I see Rivians literally daily, and I still quite like them. I would like to see a Lucid in person, but never have yet. I’ve seen one Lyriq but it was actually on the pre-release press drive. You know the EV I really want to see and really want to be successful? Vanderhall Brawley. Its really the only EV out there I actually have a real desire to own. Real buttons, real switches, real gauges, simple instead of “minimalist”, good looking. And driveable on the street where I live, regardless of UTV status
In Danish, “rode” means “a mess” or “a fuckup” so maybe most of the Fiskers and VinFasts are on the rode? Saw a Lucid parked on the street in Milwaukee recently, and some VinFasts in a showroom in Silicon Valley earlier this year, had to take pictures of both.
I spotted a Lucid Air in traffic a while back. Took a second to register what it was. Sharp-looking car, bigger than I thought. But then Rivian trucks look smaller than I thought they were, too.
I have seen quite a few Lucids Air. Given the price tag, I’m surprised at how regularly I see them. Rivians are very common here as well. I have yet to see an Ocean. I don’t expect to see a Vinfast anytime soon since I don’t run an EV towing company.
“Man, now I want a RWD Mahindra Thar (pictured).”
Couldn’t you just buy a two door Wrangler and squint? If you were really committed, you could disconnect the front drive shaft and get a custom grill made. I would applaud the creativity of anyone who builds a Thar clone out of a Jeep.
“Lucids Air” makes sense, kind of like “Attorneys General” or “Warrens Ellis”.
“Lucids Air” just sounds right to me for some reason. It is partially because I think “Lucid” and “Air” are both dippy and pretentious names. I can abide one pretentious name (“Ocean” or “Karma”, for example) as long as the corresponding make or model name is reasonable, but combing two pretentious names is insufferable. I would appreciate it if they would at least own their smugness and call it the “Savetheplanet Imbetterthanyoupollutingpeasants” or something similar.
Quarters pounder
I’ve seen Lucids, I think 3 or so this year. I have yet to see a VinFast, but I would sort of expect to soon as I’m in NC and they recently broke ground on the plant that is supposed to be built. I think I heard someone mention to me they did spot one a couple weeks ago here. Lots of Rivians too, including the R1S.
I saw a Karma on a road trip in May as well, at a Starbucks parked by an S-Class. Almost certainly it had to have been a Karma (brand) Revero, not a Karma (Fisker model).
Also…”on the rode?”
I have seen a couple Lucids, definitely none of the others. I see quite a few Rivians lately though.
Other than lots of Rivians all the time, last weekend we saw a bunch of camouflaged Mercedes coming from cottonwood pass, including what looked like some G wagons without tailpipes, perhaps G wagon EVs? We only got an ok view of one, that looked like a standard G wagon, solid rear axle, but couldn’t see a tailpipe.