How VW and Toyota became the targets of an emboldened US union

Workers at a Toyota plant on the far outskirts of St Louis, Missouri, said the carmaker usually raises pay in increments of 25 cents to 50 cents an hour. But each of the company’s past two pay increases topped $2 an hour.

“Toyota doesn’t do this stuff out of the kindness of their hearts,” said Paul Hohenshell, a production worker with 25 years of service.

Instead, Hohenshell sees a different motive: Toyota wants to halt the march of the United Auto Workers. “It’s a bribe,” he said.

The UAW, established in the 1930s, last year won record pay increases for 146,000 members whom the union represents at Ford, General Motors and Stellantis after it launched six weeks of strikes against the three legacy Detroit carmakers.

The union is now rolling out a three-year, $40mn campaign to organise workers at 13 carmakers where it has never gained traction, including some in states inhospitable to unions. Winning there has the potential to level the playing field between Detroit and foreign car groups and transform the economics of US carmaking.

A vote is scheduled this month at Volkswagen’s factory in Chattanooga, Tennessee, after more than 70 per cent of workers there signed union authorisation cards. Employees have started publicly campaigning to join the UAW at two plants in Alabama owned by Mercedes-Benz and Hyundai.

Last month, a union drive was announced at the Toyota plant in Troy, Missouri, where roughly 850 hourly employees turn out cylinder heads, an engine part that supplies the company’s nine North American car assembly plants.

The gains the UAW made last autumn impressed workers such as Kassie “KC” Albertson, who has been employed at Troy for a decade. He grew emotional as he recalled the “amazing, just breathtaking” feeling of uniting to try to improve pay and working conditions.

“It’s something you don’t see in that plant, ever,” he said. “You don’t see people come together like that.”

Hourly pay at the plant tops out at $31 after the latest rises, or $64,000 a year. That is less than both the wages at Toyota’s vehicle assembly plants and the $40 an hour recently agreed at Ford, GM and Stellantis. The Troy workers said that Toyota, which as the largest carmaker in the world is forecast to have earned more than $34bn in operating income for the fiscal year that ended March 31, can offer better terms.

“We knew they made a lot of money when compared to the Big Three . . . and how little we get paid,” said Hohenshell. “It stands out a lot to me.”

Many foreign carmakers, including Toyota, Volkswagen and Mercedes, have unionised workforces in their home countries, with an employee representative who sits on their boards to represent the union’s interest.

Yet in the US, some of the same companies have gravitated towards “right to work” states concentrated in the South. Laws there give workers the ability to opt out of paying union dues, making it more difficult for labour organisations to support themselves financially.

“Big Biz & their political lackeys are crying that the South’s economic model is under attack,” said UAW strategist Chris Brooks on X. “They’re right. The low-wage, high-profit model of exploiting Southern labour is being brought to an end by Southern workers.”

Some executives at the Detroit carmakers privately hope the union drive succeeds, as that will close the pay gap with their own plants and prevent their factories from becoming less competitive. The nearly 150,000 US factory workers employed by the 13 non-union carmakers targeted by the UAW roughly mirrors the size of their membership at the Detroit three.

While the UAW’s overarching goal is to unionise all the foreign carmakers’ plants, as well as newer electric-vehicle start-ups such as Tesla and Rivian, its campaigns are being fought one plant at a time in the hope of reaching the critical mass needed to force an employer to bargain over every worksite at once.

The UAW has tried and failed before, losing elections such as at VW-Chattanooga in 2014 and 2019, and at Nissan in Mississippi in 2017.

Its current campaign, far from the UAW’s heartland in the industrial upper Midwest, has again encountered pushback. Politicians said that unionising could dissuade the carmakers from expanding and make it harder to court other investments. The companies have in some cases become civic fixtures: Volkswagen manages a park adjacent to its Chattanooga plant, while Mercedes, whose plant is in Tuscaloosa, Alabama, sponsors the city’s primary concert venue and helped with the recovery from deadly tornadoes in 2011.

“The Alabama model for economic success is under attack,” wrote Alabama governor Kay Ivey on the state commerce department’s blog in January, calling car manufacturing one of Alabama’s “crown jewel industries” and saying that the union was an “out-of-state special interest group” that threatened jobs both at the plant and at nearby suppliers.

At Mercedes, union supporters said that managers pulled workers from assembly lines to ask them about union activities. Alabama business groups have also rented billboards attacking the union along the highway connecting the plant to the rest of Tuscaloosa.

The UAW on Wednesday said it had filed charges against Mercedes in Germany, arguing that the company had violated a new German law that prohibits employers from launching anti-union campaigns anywhere in their supply chains, after having filed similar complaints with American labour officials last month.

Mercedes said in a statement that it “has not interfered with or retaliated against any team member in their right to pursue union representation”.

Mercedes’ global chief executive Ola Källenius has worked at its Alabama factory twice — once in 1998, and again in 2009 as head of its US business. Unionising is “ultimately a decision that the team members make”, he said in an interview this year, and “if and when they do that, we just want to make sure they make an informed decision”.

Missouri, a Midwestern state, lacks a right-to-work law but union organisers are facing other forms of resistance. A screen inside the Toyota plant recently told workers that “a third party, the union alone, would be authorised to speak on your behalf” and Toyota would be “forbidden” from discussing pay and working conditions directly with workers, according to photographs taken by workers. Another slide described a UAW wage comparison between Toyota’s plant and GM as “bad info”, while a poster said “a union couldn’t stop . . . lay-offs” at the Detroit carmakers.

Outside the plant, the anti-union Center for Union Facts has a billboard inviting viewers to “Learn the truth about the UAW” and directing them to a website with claims about the union’s “broken promises” and “anti-Israel stance” after it called for a ceasefire in Gaza, a point that resonates in a Bible Belt town.

Toyota said that the company respects “team members’ rights to choose whether they want to join or not join a union”.

Labour experts said that success for UAW would be the most pivotal moment in US labour history since GM workers struck at a Flint, Michigan, plant in 1936, establishing the UAW and ultimately unionising the entire domestic car industry.

Last autumn’s strike against the Big Three carmakers is similar to the long-ago Flint strike, said Joshua Murray, a Vanderbilt University professor who studies car industry unionisation, because it “showed people this union strategy works, and it may be actually worth it for us to stick our neck out and join”.

In Tuscaloosa, the allure of working at Mercedes has faded in recent years as annual pay rises fell behind inflation and the plant hired more staff on temporary contracts, said Michael Innis-Jiménez, a professor at the University of Alabama. Jobseekers can earn $2 an hour more in the fast-food industry than those who sign on for temporary roles at $16 an hour to build luxury SUVs, according to recent job postings on Indeed.

Jeremy Kimbrell, who has worked at Mercedes since 1999, said that headlines about the pay and benefit increases in the UAW’s contracts with the Big Three made the plant’s 6,100 workers more eager to organise than in the past.

“We’re not Ford, GM and Chrysler building these $30, $40 or $50,000 cars,” he said. “Our cars are $100,000-plus. So why would we not deserve this? Because we live in Alabama? That’s the oldest, most pitiful argument I’ve ever heard.”

At the Troy plant, workers said their campaign was in part motivated by issues such as at-will employment, which allows Toyota to dismiss them at any time, and searing temperatures inside the plant during the summer. Many workers also said favouritism inside the plant influenced promotions and the handling of work-related injuries.

Toyota said the company provided stable employment, followed “standardised promotion processes” and had invested to improve “safety, efficiency and the overall work experience for our team members at our Missouri facility”, including spending millions in additional heating, ventilating and air conditioning capacity.

The workers also want higher pay even after the recent rises. Troy employees, said James Lehman, a worker at Toyota’s plant, are “to Japan what Mexico is to us: cheap labour”.