What do you think?
The United Auto Workers union strike is quite the controversial topic these days. While some are characterizing the assembly line workers who walked out of three factories last week as lazy bums, others see them as valiant warriors striving against a system which unfairly profits from their labors. Central to all this is the executive pay structure at Stellantis, Ford, and GM, including Mary Barra’s $29 million salary for 2023.
Find out why GM lashed out at the Biden Administration here.
As laid out nicely by Business Insider, Barra, who is CEO of General Motors, has been given a 34% pay increase over the last four years. Like most CEOs, her pay is ostensibly tied to company performance, a point she used in her defense during an interview with CNN.
She asserted that 92% of her compensation is performance-based. From there, she touted the 20% pay increase GM proposed for UAW members (instead of the 40% increase the union has demanded) and the profit-sharing payouts to line workers.
On top of all that, Barra says GM has “a competitive offer on the table” for UAW members, what with the “world class healthcare” and such also extended to employees. Not everyone agrees.
— CNN (@CNN) September 15, 2023
UAW’s president asserts that all three big American automakers can easily afford to bump pay up by 40%, thanks to record profits. After all, when the companies are rolling in the dough they should spread the wealth, right?
CEOs and other executives like Barra certainly have been enjoying those gains. However, the situation with covid created a unique and non-repeatable dynamic for automakers and dealerships. With supply increasing in the new car market as interest rates keep climbing, those record profits are likely in the rearview mirror.
Some have asked an interesting question: would UAW workers be okay with 92% of their pay being tied to the company’s performance? And would that be fair? After all, if a recession kicks off shortly and GM takes a bath as consumers pull back from buying new vehicles, would line workers be okay with seeing their pay whittle down?
There’s a big chasm between UAW and the Big Three at the moment, one that stands to cost the automakers billions. Some believe this stalemate could even push us into a recession. But who’s right? Let us know what you think.
Images via GM