UAW reaches deal with GM, ending auto strike with big win for workers
The last domino has fallen, with UAW and GM reaching a deal to end the auto industry strike. Now, tentative deals have been met with all three auto companies, which means the strike is over.
The deal has not yet been confirmed by either GM or UAW, but it was first reported by Bloomberg and has been widely reported since. It comes just two days after GM workers walked out of the Cadillac Lyriq plant at Spring Hill Assembly in Tennessee.
As a result, we have even fewer details than with the last deals with Ford and Stellantis. In both of those cases, UAW posted a video going over some details of the deal, but in this case, they have not yet posted a similar video.
Bloomberg reports that the deal is “broadly similar” to the first two deals. GM has the most unionized workers of the Big Three, and retirement benefits were particularly in focus, so we’ll have to see what other specifics come out of that deal when it’s revealed.
But the basic details likely include a 25% increase in pay for all workers – which is a larger raise than all combined wage raises between 2001-2022 – plus cost-of-living adjustments. These cost-of-living adjustments used to be part of union contracts but were given up during the economic downturn, which started in 2008 and took until now for the workers to get back.
One unique part of the GM deal that we already know about is that GM has agreed to bring all US GM joint-venture battery plants under the union master agreement. This represented a “leapfrog” in negotiations from GM, putting the company in front of others in terms of their offer to UAW, but then GM ended up being the last to come to a final agreement.
And batteries were an important win for UAW because in discussions over this strike, interviewers have repeatedly tried to get UAW President Shawn Fain to badmouth electric vehicles and blame them for wage or job problems, but Fain has never taken the bait. Instead, he has always insisted that the UAW is looking for a “just transition” to electric vehicles that ensures workers still get treated fairly as the industry is upended.
Previously, battery workers had been paid significantly less than other manufacturing workers, though UAW had made progress on that front even before the strike began.
The deal with Stellantis also included a boost to electric vehicles. UAW got Stellantis to promise to reopen a shuttered plant in Belvidere, Illinois, and further to commit to building a new battery factory at the same site, which should add approximately 1,000 battery jobs that previously had not been planned.
While we don’t know the details of this deal yet, the process to approve it is likely to be the same. The deal needs to be finalized by union leadership, who will then present it to all union members by publishing it online and via Facebook livestream. Then meetings will be held, and the deal will be voted on by each local chapter.
But, in previous deals, UAW has directed workers to go back to work right away once the tentative agreement has been reached in a show of good faith that everyone wants to end this strike quickly. Leadership is confident that these deals are good enough that they will be ratified by members when the time comes and that everyone is eager to get back to work.
Unions have been having a bit of a moment in the US in the last couple of years as frustrated workers have started demanding more. The US has seen upticks in union membership, strike activity, and union popularity, with unions reaching their highest approval rating since polls began in 1965.
Several successful strikes have happened across the US economy, and UAW seems to want to bring this momentum forward into the future. To this end, UAW has invited other unions in America to align contract expirations around the same time frame, so as to inspire broader labor action.
The contracts UAW negotiated are expected to last 4.5 years until April 30, 2028. This is the day before May Day, also known as International Workers’ Day, a day that commemorates the early labor movement in the US, but is more celebrated overseas than it is here. It seems clear that UAW is targeting much bigger labor action across the economy in the future.
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The Rio Tinto Group logo atop Central Park tower, which houses the company’s offices, in Perth, Australia, on Friday, Jan. 17, 2025.
Bloomberg | Bloomberg | Getty Images
The mining sector appears poised for a frantic year of dealmaking, following market speculation over a potential tie-up between industry giants Rio Tinto and Glencore.
It comes after Bloomberg News reported Thursday that British-Australian multinational Rio Tinto and Switzerland-based Glencore were in early-stage merger talks, although it was not clear whether the discussions were still live.
Separately, Reuters reported Friday that Glencore approached Rio Tinto late last year about the possibility of combining their businesses, citing a source familiar with the matter. The talks, which were said to be brief, were thought to be no longer active, the news agency reported.
Rio Tinto and Glencore both declined to comment when contacted by CNBC.
A prospective merger between Rio Tinto, the world’s second-largest miner, and Glencore, one of world’s largest coal companies, would rank as the mining industry’s largest-ever deal.
Combined, the two firms would have a market value of approximately $150 billion, leapfrogging longstanding industry leader BHP, which is worth about $127 billion.
Analysts were broadly skeptical about the merits of a Rio Tinto-Glencore merger, pointing to limited synergies, Rio Tinto’s complex dual structure and strategic divergences over coal and corporate culture as factors that pose a challenge for concluding a deal.
“I think everyone’s a bit surprised,” Maxime Kogge, equity analyst at Oddo BHF, told CNBC via telephone.
“Honestly, they have limited overlapping assets. It’s only copper where there is really some synergies and opportunity to add assets to make a bigger group,” Kogge said.
Global mining giants have been mulling the benefits of mega-mergers to shore up their position in the energy transition, particularly with demand for metals such as copper expected to skyrocket over the coming years.
A highly conductive metal, copper is projected to face shortages due to its use in powering electric vehicles, wind turbines, solar panels and energy storage systems, among other applications.
Oddo BHF’s Kogge said it is currently “really tricky” for large mining firms to bring new projects online, citing Rio Tinto’s long-delayed and controversial Resolution copper mine in the U.S. as one example.
“It’s a very promising copper project, it could be one of the largest in the world, but it is fraught with issues and somehow acquiring another company is a way to really accelerate the expansion into copper,” Kogge said.
“For me, a deal is not so attractive,” he added. “It goes against what all these groups have previously tried to do.”
Last year, BHP made a $49 billion bid for smaller rival Anglo American, a proposal which ultimately failed due to issues with the deal’s structure.
Some analysts, including those at JPMorgan, expect another unsolicited offer for Anglo American to materialize in 2025.
M&A parlor games
Analysts led by Dominic O’Kane at JPMorgan said the bank’s “high conviction view” that 2025 would be defined by mergers and acquisitions (M&A), particularly among U.K.-listed miners and global copper companies, was coming to fruition just two weeks into the year.
The Wall Street bank said its own analysis of the mining sector found that the current economic and risk management environment meant M&A was likely preferred to the building of organic projects.
Analysts at JPMorgan predicted the latest speculation would soon thrust Anglo American back into the spotlight, “specifically the merits and probability of another combination proposal from BHP.”
Prior to pursuing Anglo American, BHP completed an acquisition of OZ Minerals in 2023, bolstering its copper and nickel portfolio.
The company logo adorns the side of the BHP gobal headquarters in Melbourne on February 21, 2023. – The Australian multinational, a leading producer of metallurgical coal, iron ore, nickel, copper and potash, said net profit slumped 32 percent year-on-year to 6.46 billion US dollars in the six months to December 31. (Photo by William WEST / AFP) (Photo by WILLIAM WEST/AFP via Getty Images)
William West | Afp | Getty Images
Analysts led by Ben Davis at RBC Capital Markets said it remains unclear whether talks between Rio Tinto and Glencore could result in a simple merger or require the breakup of certain parts of each company instead.
Regardless, they said the M&A parlor games that arose following merger talks between BHP and Anglo American will undoubtedly “start up again in earnest.”
“Despite Glencore once approaching Rio Tinto’s key shareholder Chinalco in July 2014 for a potential merger, it still comes as a surprise,” analysts at RBC Capital Markets said in a research note published Thursday.
BHP’s move to acquire Anglo American may have catalyzed talks between Rio Tinto and Glencore, the analysts said, with the former potentially looking to gain more copper exposure and the latter seeking an exit strategy for its large shareholders.
“We would not expect a straight merger to happen as we believe Rio shareholders would see it as favouring Glencore, but [it’s] possible there is a deal structure out there that could keep both sets of shareholders and management happy,” they added.
Copper, coal and culture
Analysts led by Wen Li at CreditSights said speculation over a Rio Tinto-Glencore merger raises questions about strategic alignment and corporate culture.
“Strategically, Rio Tinto might be interested in Glencore’s copper assets, aligning with its focus on sustainable, future-facing metals. Additionally, Glencore’s marketing business could offer synergies and expand Rio Tinto’s reach,” analysts at CreditSights said in a research note published Friday.
“However, Rio Tinto’s lack of interest in coal assets, due to recent divestments, suggests any merger would need careful structuring to avoid unwanted asset overlaps,” they added.
A mining truck carries a full load of coal at Glencore Plc operated Tweefontein coal mine on October 16, 2024 in Tweefontein, Mpumalanga Province, South Africa.
Per-anders Pettersson | Getty Images News | Getty Images
From a cultural perspective, analysts at CreditSights said Rio Tinto was known for its conservative approach and focus on stability, whereas Glencore had garnered a reputation for “constantly pushing the envelope in its operations.”
“This cultural divide might pose challenges in integration and decision-making if a merger were to proceed,” analysts at CreditSights said.
“If this materializes, it could have broader implications for mega deals in the metals [and] mining space, potentially putting BHP/Anglo American back in play,” they added.
— CNBC’s Ganesh Rao contributed to this report.
GreenPower Motor Company says it’s received three orders for 11 of its BEAST electric Type D school buses for western state school districts in Arizona, California, and Oregon.
GreenPower hasn’t made the sort of headline-grabbing promises or big-money commitments that companies like Nikola and Lion Electric have, but while those companies are floundering GPM seems to be plugging away, taking orders where it can and actually delivering buses to schools. Late last year, the company scored 11 more orders for its flagship BEAST electric school bus.
As far as these latest orders go, the breakdown is:
- seven to Los Banos Unified School District in Los Banos, California
- two for the Hood River County School District in Hood River, Oregon
- two for the Casa Grande Elementary School District in Casa Grande, Arizona
Those two BEAST electric school buses for Arizona will join another 90-passenger BEAST that was delivered to Phoenix Elementary School District #1, which operates 15 schools in the center of Phoenix, late last year.
“As school districts continue to make the change from NOx emitting diesel school buses to a cleaner, healthier means of transporting students, school district transportation departments are pursuing the gold standard of the industry – the GreenPower all-electric, purpose-built (BEAST) school buses,” said Paul Start, GreenPower’s Vice President of Sales, School Bus Group. “(The) GreenPower school bus order pipeline and production schedule are both at record levels with sales projections for (2025) set to eclipse the 2024 calendar year.”
GreenPower moved into an 80,000-square-foot production facility in South Charleston, West Virigina in August 2022, and delivered its first buses to that state the following year.
Electrek’s Take
Since the first horseless carriage companies started operating 100 years ago (give or take), at least 1,900 different companies have been formed in the US, producing over 3,000 brands of American automobiles. By the mid 1980s, that had distilled down to “the big 3.”
All of which is to say: don’t let the recent round of bankruptcies fool you – startups in the car and truck industry is business as usual, but some of these companies will stick around. If you’re wondering which ones, look to the ones that are making units, not promises.
SOURCE | IMAGES: GreenPower Motors.
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While some recent high-profile bankruptcies have cast doubt on the EV startup space recently, medium-duty electric truck maker Harbinger got a shot of credibility this week with a massive $100 million Series B funding round co-led by Capricorn’s Technology Impact Fund.
It’s been a rough couple of weeks for fledgling EV brands like Lion Electric and Canoo, but box van builder Harbinger is bucking the trend, fueling its latest funding round with an order book of 4,690 vehicles that’s valued at nearly $500 million. Some of the company’s more notable customers including Bimbo Bakeries (which owns brands like Sara Lee, Thomas’, and Entenmann’s) and THOR Industries (Airstream, Jayco, Thor), which is also one of the investors in the Series B.
Other prominent investors include Tiger Global, the Coca-Cola System Sustainability Fund, and ArcTern Ventures.
As for what makes Harbinger such an attractive investment prospect, Dipender Saluja, Managing Partner of Capricorn Investment Group’s Technology Impact Fund explains that, “Harbinger has demonstrated a remarkable ability to reach significant milestones far quicker than other EV companies … the market has been impressed by their ability to develop large portions of the vehicle in-house to drive down unit costs, while remaining capital efficient.”
The company plans to use the funds to ramp up to higher-volume production capacity and deliver on existing orders, as well as build-out of the company’s sales, customer support, and service operations.
“Harbinger is entering a rapid growth phase where we are focused on scaling production of our customer-ready platform,” said John Harris, co-founder and CEO. “These funds catalyze significant revenue generation. We’ve developed a vehicle for a segment that is ripe for electrification, and there is a strong product/market fit that will help fuel our upward trajectory through 2025 and beyond.”
The company has raised $200 million since its inception in 2021.
SOURCE | IMAGES: Harbinger.
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