Ford’s $9.2 Billion Grant for Battery Plants Riles UAW

Shawn Fain, elected earlier this year as UAW president, accuses Ford and its South Korean joint-venture partner of creating “7,500 low-road jobs with no consideration for wages, working conditions, union rights or retirement security.”

Joseph Szczesny

July 5, 2023

5 Min Read
Ford Blue Oval-Tennessee
Ford-Sk ON joint venture’s Blue Oval City battery-manufacturing plant under construction near Stanton, TN.Ford

The UAW continues to tighten the screws on Detroit automakers, as union President Shawn Fain takes aim at another of the three manufacturers with a rhetorical blast not very different in tone from the attacks he has leveled against General Motors and Stellantis.

The last time the UAW staged a strike against Ford, Gerald Ford occupied the White House. Now, Fain is hitting at the heart of the automaker’s Blue Oval electric-vehicle project by attacking a $9.2 billion grant awarded by the U.S. Department of Energy to support construction of new battery plants in Kentucky and Tennessee.

In a statement following the DOE announcement, Fain (pictured, below left) characterizes the grant as “a massive $9.2 billion giveaway loan to Ford…to create 7,500 low-road jobs with no consideration for wages, working conditions, union rights or retirement security.

Shawn Fain screenshot.png

Shawn Fain screenshot_1

“This handout may further enrich Ford shareholders, but it shortchanges communities and the UAW members who produce Ford’s vehicles, powertrains and record-breaking profits,” he says.

In part, the union’s frustration with Ford stems from a meeting in early June of the UAW’s Ford Council, which comprises local union officials at each Ford factory and warehouse. Representatives at the meeting were upset when they learned that, as it stands, UAW members have no transfer rights to Blue Oval properties.

“Ford expects that BlueOval SK (a joint venture between Ford and South Korean battery maker Sk ON) will pay competitive wages and benefits to attract and retain the workforce needed to build high-tech batteries,” Ford says in a statement e-mailed to Wards.

“Employees at BlueOval SK’s battery plants will be able to choose whether they organize, a right that Ford fully respects and supports,” the automaker says.

However, in an era where plants can close over union protests, transfer rights are a key issue, particularly for younger union members, who consider it part of employment security, according to one UAW official who was recently briefed on the matter but is not authorized to speak for the union.

The fact that union members are not eligible yet for jobs at Blue Oval is only beginning to percolate through the union, the official adds.

Fain pledged in his campaign for UAW president earlier this year that he would lead the effort to include the union in the industry’s shift to electrification.

“We have been absolutely clear that the switch to electric engine jobs, battery production and other EV manufacturing cannot become a race to the bottom,” he says. “Not only is the federal government not using its power to turn the tide – they’re actively funding the race to the bottom with billions in public money.”

Fain also notes during a recent Facebook Live appearance that union members must be given an opportunity to train or be retrained for future electrification jobs.

Fain’s attacks on Stellantis for closing an assembly plant in Belvedere, IL; wages paid at General Motors’ new Ultium battery plant near Lordstown, OH; and now Ford are raising expectations for a major confrontation when UAW contracts with the Detroit Three expire in September.

John Murphy, lead automotive analyst for Bank of America, observes during an appearance at the Automotive Press Assn. in Detroit that industry’s executives are still trying to adjust to the new UAW president as well as his demands and militant rhetoric. “Shawn Fain is a wild card,” he says.

Ford F-150 Lightning assembly screenshot.png

Ford F-150 Lightning assembly screenshot_0

“I think we’re going to see a strike on Sept. 15,” Murphy adds. He says he is 90% certain of a strike at Stellantis, where the company’s desire to cut costs is on a collision course with Fain’s vow to roll back concessions such as two-tier pay schedules. Murphy adds chances of a subsequent strike at one of the other automakers is “much higher than normal.”

Fain says Detroit’s automakers have rolled up substantial profits and paid executives handsomely over the past decade.

“These companies are extremely profitable and will continue to make money hand over fist whether they’re selling combustion engines or EVs. Yet the workers get a smaller and smaller piece of the pie. Why is Joe Biden’s administration facilitating this corporate greed with taxpayer money?” says Fain, who has vowed to reverse the concessions made during the Great Recession of the late 2000s and early 2010s. He also has stepped up criticism of the Biden Admin., which he says has not lived up to its “pro-worker” rhetoric and promises.

Over the years, Ford has maintained a generally good relationship with the UAW. Local union officials maintain the UAW basically helped Ford avert bankruptcy with its concessions during the Great Recession. Ford now employs more UAW members than any other company in the U.S.

The Blue Oval project is expected to create a total of 5,000 construction jobs in Tennessee and Kentucky, and 7,500 operational jobs once the three plants are up and running. But the DOE grant favors Ford at the UAW’s expense, Fain contends. 

“The last time the federal government gave the Big Three billions of dollars, the companies did the exact same thing: slash wages, cut jobs and undermine the industry that for generations created the best jobs for working families in this country,” he says. “Auto workers and our families took the hit in 2009 in the name of saving the industry. We were never made whole, and it’s an absolute shame to see another Democratic administration doubling down on a taxpayer-funded corporate giveaway.”

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