Last week Tesla appeared to bow to pressure from a trend that’s been rippling through the auto industry.
Recent wins by the United Autoworkers Union have sent wages up for plant workers within the Detroit 3, a boost that encouraged several competitors to follow suit including Toyota, Volkswagen and Hyundai.
Tesla, an American auto company that’s been notoriously opposed to union activity in its plants, appears to be seeing the writing on the wall – boost wages in line with the industry or risk organization efforts or quits.
Reports say that internal communication at Tesla Fremont has indicated that plant workers there and at other gigafactories would soon receive a “market adjustment pay increase,” impacting roles like production associates, material handlers and quality inspectors.
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UAW president Shawn Fain seemingly took credit for the wage increase, saying last week that the hikes followed in the footsteps of nearly every other automaker “in the wake of our historic victory.”
Bloomberg recently illustrated the pay gap between union and non union automakers in the US, noting that Tesla – even prior to these wage increases – held a labor cost advantage over its competitors of up to $1.7 billion, which works out to about $2,700 per vehicle.
Bloomberg also suggested back in October that Fain – notorious for his confrontational nature – likely viewed Elon Musk as a caricature for the wealthy elite. Unionizing Tesla would be like a crown jewel in the UAW efforts, and a way of expanding its influence outside of Detroit – meaning Fain and company would all the more likely take a crack at the EV maker.
Will preemptive wage increases be enough to stifle any organization efforts now? Time to watch and wait, but if we know Shawn Fain he’ll certainly, at least, give it a try.
