The milkman went missing thanks to the rise of refrigerators. Switchboard operators were done in by the dawn of direct dialing. And in the car industry, auto workers are deathly afraid the engine assembler will give way to battery builders.
Dread over the prospect that plug-in cars -- which have fewer parts and require less labor to build -- will doom auto jobs helped spark the first UAW strike against General Motors in over a decade. Ford Motor Co. and Fiat Chrysler Automobiles, which are rolling their own battery-powered models to market in the coming years, could face a similar fate if they’re unable to quell the UAW’s concerns that widespread adoption of EVs endangers the employment of 35,000 union members.
“There’s a potential for our jobs to be gone -- they don’t need us anymore,” said Tim Walbolt, president of the UAW local representing workers at a Fiat Chrysler transmission components plant near Toledo, Ohio. “It scares us.”
For all the buzz generated by Tesla Inc., the EV era is still in its infancy, with zero-emission autos having reached just 2 percent of global production. GM has extended the UAW an offer to get in on the ground floor, pitching a new battery plant staffed by dues-paying union members in an Ohio town jarred by job loss. But the overture came with a catch: GM wants to pay the workers less, and the facility is unlikely to need as many staff as an engine or transmission factory would.
A recent study of electric-vehicle production in Europe by consultant AlixPartners found that it took 40 percent fewer hours to assemble an electric motor and battery than a traditional internal-combustion engine and transmission.
“It’s a bad news story from a labor perspective,” said Mark Wakefield, the head of AlixPartners’s automotive practice. “You would just fundamentally need less people.”
Perversely, GM also arguably has uncertainty on its side at the bargaining table. It’s going to want concessions to cushion itself against the risk that consumer adoption of electric autos remains slow. The automaker isn’t fully utilizing the factory that builds the Chevrolet Bolt EV north of Detroit, and tepid demand for the plug-in hybrid Chevy Volt put the future of the factory that assembles it in nearby Hamtramck in doubt.
Collision Course
The collision with automakers over electrification is one the UAW saw coming.
“Electric, to me, is where the real risk is to our membership,” Jennifer Kelly, the union’s research director, said during a collective-bargaining conference in Detroit earlier this year.
It’s almost certain to carry over from the UAW’s talks with GM to negotiations with Detroit’s other automakers. Ford has estimated electric cars will require 30 percent fewer hours of labor per vehicle and 50 percent less factory floor space.
“Rationalization of the powertrain portfolio is certainly a huge opportunity for all of us as we start this transition,” Joe Hinrichs, Ford’s automotive president, told investors on an earnings call in April.
Even FCA -- a laggard with regard to electrification -- has stoked fear at union halls linked to internal-combustion components plants, where rumors are flying that the company plans to outsource work to lower-paying suppliers.
“We cannot help but feel like the left behind stepchildren of the UAW,” Mike Booth, the president of the union’s local in Marysville, Mich., wrote in a letter to the labor group’s Chrysler council last month. He and other UAW leaders fear that German mega-supplier ZF Friedrichshafen, which took over operation of a Chrysler axle plant in 2008, will take work away from the automaker’s machining facility near Toledo and a transmission and castings complex in Kokomo, Ind.
A Fiat Chrysler spokeswoman said the operations the union are concerned about are critical to the business. ZF will continue to work with the UAW in Marysville, and an arrangement in which Fiat Chrysler licenses technology from the supplier in Kokomo may be creating some confusion, a spokesman said. He declined to comment on Toledo.
