Mack Trucks and the striking United Auto Workers have suspended negotiations. Mack risks hitting its off-highway operations rather than sweeten a new master contract that union leaders approved but workers rejected.
The nearly 3-week strike by 3,900 UAW-represented workers in three states halted truck production at Mack’s main assembly plant near Allentown, Pennsylvania. It also affects a remanufacturing facility in Pennsylvania and parts distribution centers in Maryland and Florida.
An engine plant that supplies Mack and Volvo Trucks in North America is located in Hagerstown, Maryland. The Mack contracts existed before Volvo acquired Mack in 2000. The company and the UAW agreed to continue negotiations under that framework.
Volvo Trucks North America canceled two shifts Monday at its New River Valley plant in Dublin, Virginia. The company plans regular production for the rest of the week, a Volvo Group spokesman said in an email on Saturday. A 12-day UAW strike at Mack in 2019 also curtailed Volvo manufacturing due to engine shortages.
Mack shares more details about the rejected contract
In a statement On Thursday afternoon, Mack said the company and UAW negotiators reached tentative agreements this week on the four local agreements that were not ratified by UAW members on Oct. 8. .”
Mack is in a difficult position. It is losing production — and revenue — every day the strike continues. But he is holding the union accountable for living up to what local and international leaders advocated before 73% of workers voted against the interim deal.
Demand remains strong for the company’s products, which primarily target the off-highway, heavy duty and energy sectors. Markets for highway truck tractors are softening amid depressed freight rates and higher interest rates.
“Mack is sticking to the financial terms of the Oct. 1 tentative agreement with the union. “UAW leadership approved and called a ‘record’ contract for the heavy-duty trucking industry,” the company said in a statement.
Mack went into more detail about the rejected offer:
- The average wage increase over five years would be 36%. The average immediate salary increase for all covered employees is nearly 15%.
- For the nearly half of the total workforce not yet receiving higher wages, the average increase over five years would be 55%. The average immediate wage increase would exceed 20%.
- Most workers already on the top rate will get an immediate 10% pay rise and up to 20% over five years. The company says the survey shows Mack’s top workers have above-market rates.
- Premiums for the company’s health care coverage have not increased in more than six years despite a 66% increase in the company’s costs over the past decade. They will remain unchanged under the five-year deal.
Examining the influence of the Detroit Three-UAW talks on Mack
To an unknown extent, Mack’s separate master contract is affected by negotiations in a UAW strike that began Sept. 15. The union’s strategy of targeting specific General Motors, Ford and Stellantis plants has kept two-thirds of its 146,000 members on the job.
A tentative deal with Ford reached Wednesday, including a 25 percent hourly raise over 4 1⁄2 years, looks richer than Mack’s deal. Ford has 51,000 hourly workers and much higher revenue and profits than Mack. GM and Stellandis had not reached tentative agreements as of Friday afternoon.
The Detroit talks and the strong socialist presence in the UAW at Mack appear to be encouraging local union leaders to push for more money and improved benefits to strike a deal.
Mack’s leadership, hoping to avoid becoming embroiled in the Detroit Three talks, may also have opted for austerity because it remembers that several tentative agreements between Volvo and the UAW were rejected by workers striking at Volvo’s New River Valley operations in Dublin. of Virginia for approximately five weeks in 2021.
At the time, it was hard to tell whether the workers were angrier with their local unionists or with the company. Volvo eventually imposed the terms of the third agreement, which received a split.
Editor’s Note: Updates paragraph 4 with an impact on Volvo Trucks production in North America.
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