Ford, General Motors (GM) and Stellantis face continued negotiations with the United Auto Workers (UAW) union after around 13,000 workers shut down three manufacturing plants when previous contracts expired on Thursday.
The shutdowns could be costly for the so-called “Big 3” automakers if union demands are not met. Some say electric vehicle (EV) market leader Tesla could be set to win big from the damage amidst the Big 3’s attempts to transition to EVs.
UAW workers shut down the Ford Michigan Assembly Plant’s Final Assembly and Paint facilities, as detailed in a Detroit Free Press report on Sunday morning. The strikes also shut down the Stellantis Toledo Assembly Complex in Ohio and GM’s Assembly plant in Wentzville, Missouri.
Following the walkouts, Ford CEO Jim Farley warned that the UAW’s demands could force bankruptcy, and the automaker also laid off 600 employees at its Michigan plant. GM says it plans to lay off around 2,000 workers at its Fairfax Assembly facility in Kansas City, Kansas this week due to an inability to get parts from the Wentzville plant, inevitably causing a production halt.
While the UAW initially proposed a 40-percent wage increase over four years, based on compensation increases the automakers’ CEOs have received, the union lowered its demands to a 36-percent increase last week.
Still, negotiations remain far off. Ford and GM most recently offered 20-percent wage increases over the period, while Stellantis offered 21 percent.
In addition to wage increases over the four-year period, the UAW is demanding the automakers restore cost-of-living allowances (COLA) lost in a 2007 union contract, which are expected to help stave off the effects of inflation.
Demands also include moving to a 32-hour work week while retaining the pay for a 40-hour work week, the restoration of defined benefit pensions, increased paid time off, limited use of temporary workers, and reducing the time it takes for employees to make top wages.
UAW President Shawn Fain has used the wage demands as a comparison between worker and CEO pay increases. The UAW initially created the 40-percent wage increase figure based on compensation increases for the automakers’ CEOs since 2019. According to Fain, workers have only gained 6-percent wage increases during that time.
According to a breakdown from AP News in a Sunday morning report, median worker pay in 2022 was highest at GM at $80,034. In the same year, median worker pay at Ford and Stellantis landed at $74,691 and 64,328 euros (~$68,660), respectively.
AP News also reports that GM CEO Mary Barra is the highest-paid of the three executives, with her 2022 compensation package paying out $28.98 million. Her pay has increased by roughly 34 percent since 2019, according to an analysis by Equilar from public data filings.
Following her was Farley, who was paid almost $21 million by Ford through his compensation package in 2022, marking a 25 percent jump from former CEO William Clay Ford’s pay in 2019.
Stellantis is a European company, so the way its executive pay is made public differs slightly from GM or Ford’s. CEO Carlos Tavares was paid roughly 23.46 million euros ($25.04 million) in 2022, according to the automaker’s annual remuneration report. However, this figure includes “realized pay,” detailing previously granted equity values that vested the same year as reports are made.
Instead of using this figure, Equilar utilized a similar “grant date” method to make the comparisons more accurate. By this method, Equilar found Tavares’ compensation to be roughly 21.95 million euros ($23.43 million) last year, marking a 24-percent drop from former CEO Mike Manley’s 2019 compensation package of 29.04 million euros ($31 million).
Many CEOs get most of their compensation from stock options or other non-salary payment methods.
In 2022, the biggest payout in Barra’s compensation package was $14.62 million in stock grants, vested over three years. During the same year, Farley received $15.14 million in stock awards, which have a similar three-year vesting period with the final value being tied to performance.
Negotiations between the automakers and the UAW are expected to continue this week.
Amidst the strikes, EV manufacturer Tesla is set to launch deliveries of its Cybertruck and Model 3 Highland, and the automaker is also initiating a $1.8 billion lease securitization to gain additional funding.
Tesla prepares for $1.8 billion lease securitization: report
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Tesla Megapacks chosen for 548 MWh energy storage project in Japan
Tesla plans to supply over 100 Megapack units to support a large stationary storage project in Japan, making it one of the country’s largest energy storage facilities.
Tesla’s Megapack grid-scale batteries have been selected to back an energy storage project in Japan, coming as the latest of the company’s continued deployment of the hardware.
As detailed in a report from Nikkei this week, Tesla plans to supply 142 Megapack units to support a 548 MWh storage project in Japan, set to become one of the country’s largest energy storage facilities. The project is being overseen by financial firm Orix, and it will be located at a facility Maibara in central Japan’s Shiga prefecture, and it aims to come online in early 2027.
The deal is just the latest of several Megapack deployments over the past few years, as the company continues to ramp production of the units. Tesla currently produces the Megapack at a facility in Lathrop, California, though the company also recently completed construction on its second so-called “Megafactory” in Shanghai China and is expected to begin production in the coming weeks.
READ MORE ON TESLA MEGAPACKS: Tesla Megapacks help power battery supplier Panasonic’s Kyoto test site
Tesla’s production of the Megapack has been ramping up at the Lathrop facility since initially opening in 2022, and both this site and the Shanghai Megafactory are aiming to eventually reach a volume production of 10,000 Megapack units per year. The company surpassed its 10,000th Megapack unit produced at Lathrop in November.
During Tesla’s Q4 earnings call last week, CEO Elon Musk also said that the company is looking to construct a third Megafactory, though he did not disclose where.
Last year, Tesla Energy also had record deployments of its Megapack and Powerwall home batteries with a total of 31.4 GWh of energy products deployed for a 114-percent increase from 2023.
Other recently deployed or announced Megapack projects include a massive 600 MW/1,600 MWh facility in Melbourne, a 75 MW/300 MWh energy storage site in Belgium, and a 228 MW/912 MWh storage project in Chile, along with many others still.
What are your thoughts? Let me know at zach@teslarati.com, find me on X at @zacharyvisconti, or send us tips at tips@teslarati.com.
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Elon Musk responds to Ontario canceling $100M Starlink deal amid tariff drama
Ontario Premier Doug Ford said, opens new tab on February 3 that he was “ripping up” his province’s CA$100 million agreement with Starlink in response to the U.S. imposing tariffs on Canadian goods.
Elon Musk company SpaceX is set to lose a $100 million deal with the Canadian province of Ontario following a response to the Trump administration’s decision to apply 25 percent tariffs to the country.
Starlink, a satellite-based internet service launched by the Musk entity SpaceX, will lose a $100 million deal it had with Ontario, Premier Doug Ford announced today.
Starting today and until U.S. tariffs are removed, Ontario is banning American companies from provincial contracts.
Every year, the Ontario government and its agencies spend $30 billion on procurement, alongside our $200 billion plan to build Ontario. U.S.-based businesses will…
— Doug Ford (@fordnation) February 3, 2025
Ford said on X today that Ontario is banning American companies from provincial contracts:
“We’ll be ripping up the province’s contract with Starlink. Ontario won’t do business with people hellbent on destroying our economy. Canada didn’t start this fight with the U.S., but you better believe we’re ready to win it.”
It is a blow to the citizens of the province more than anything, as the Starlink internet constellation has provided people in rural areas across the globe stable and reliable access for several years.
Musk responded in simple terms, stating, “Oh well.”
Oh well https://t.co/1jpMu55T6s
— Elon Musk (@elonmusk) February 3, 2025
It seems Musk is less than enthused about the fact that Starlink is being eliminated from the province, but it does not seem like all that big of a blow either.
As previously mentioned, this impacts citizens more than Starlink itself, which has established itself as a main player in reliable internet access. Starlink has signed several contracts with various airlines and maritime companies.
It is also expanding to new territories across the globe on an almost daily basis.
With Mexico already working to avoid the tariff situation with the United States, it will be interesting to see if Canada does the same.
The two have shared a pleasant relationship, but President Trump is putting his foot down in terms of what comes across the border, which could impact Americans in the short term.
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Tesla Megapacks chosen for 548 MWh energy storage project in Japan
