Mack Truck Workers Strike Over 2023 Pay Deal

• More strikes from the United Auto Workers as employees at Mack Truck factories walk off the job over pay and conditions
• They’ve knocked back a pay raise of 19%, saying it doesn’t go far enough to compensate for increases in the cost of living
• It’s the latest in a string of auto strikes, with the Volvo Group owned truck manufacturer joining workers from Ford, GM and Stellantis in industrial action

The United Auto Workers strike has grown with the union workers voting down a proposed new 5 year deal with Volvo — the owners of Mack Trucks.

The deal included a pay rise of 19% over the five year period, but even so it was shot down heavily, with around 73% of the 4,000 strong voting down the proposal. The strike action adds to a growing list of industrial halts happening across the automotive industry, with ongoing contract talks with Ford, GM and Stellantis failing so far failing to lead to a deal.

Mack truck strike workers knock back proposed deal

As well as the 19% pay raise that had been on offer, had they agreed to the deal Mack workers would also have been in line to receive a $3,500 bonus, faster movement through pay grades, improved retirement benefits and an increase in vacation time for certain staff.

But it wasn’t enough. Inflation had been a major sticking point, with online discussion from workers centering around the argument that inflation had gone up by more than 19% in recent years.

In their view, this deal fell short of putting workers back to where they were before the covid pandemic and warped global supply chains sent costs through the roof.

United Auto Workers strike continues to grow

This is the latest shutdown that’s hit the US auto industry, with the United Auto Workers (UAW) strike growing seemingly by the day. Workers at plants all across the country have downed tools in a bid to get better pay and conditions.

On September 14th, 13,000 workers from GM, Ford and Stellantis (formerly Chrysler) went on strike, seeking an increase in pay of 40% over a four year period. Those figures are being negotiated, with the UAW reducing their demands to 36% a few days after the strikes began.

So far the best offer they’ve had is for a 23% bump from Ford, but this has been rejected by the UAW.

How the stock prices have reacted

Generally speaking, the current spate of strike action hasn’t been a huge blow to the stock prices of Stellantis, Ford or the owner of Mack Trucks, Volvo Group.

Stellantis has gained over 50% over the last 12 months, with the current price of $18.56 down just 0.50% from the day of the strike announcement.

Ford’s stock has also risen in recent months and is up 7.83% over the last year. It too has seen limited impact from the strikes, with the current price of $12.24 down just $0.40 from September 13th.

The performance of Volvo Group has been equally strong, gaining almost 40% in the last year and, surprisingly, jumping 2.37% today off the back of the new strike action announcement.

GM is the only one of the Detroit ‘Big Three’ who have seen their stock price take a hit in recent times, down just over 12% over the past six months. The closing price of $33.66 on September 13th has now dropped to $31.42.

The bottom line

Strikes are having widespread impacts on the auto industry, but so far it’s not impacting the stock price which is good news for investors. The end result of the deal is what will be more likely to do that, as an overly generous result could put the companies under profit pressure for years.

To that end, both the companies and the UAW will be prepared to dig in hard, meaning we may not see the end of the strike for some time yet.