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Hyundai’s Wage Increase Triggers Concerns of Worker Unrest Amid UAW Influence

Hyundai, the South Korean automaker, recently announced a significant wage hike for its factory employees, a move following in the footsteps of agreements reached by Honda and Toyota after negotiations with the United Auto Workers Union (UAW) in Detroit.

On Monday (Nov. 13), Hyundai revealed plans to raise wages for its factory workers by 25% by 2028, aligning with the general wage increases agreed upon by the UAW. Toyota also joined in, announcing an increment of 9-10% in factory employee hires starting January 2024, while Honda stated its intention to elevate wages by 11% within the same timeframe.

Labor experts have highlighted that the wage hikes by Hyundai, Toyota, and Honda are strategic responses aimed at countering the UAW’s push to reorganize US auto plants operated by foreign automakers, including Tesla. This move is intended to bolster the bargaining power of labor unions.

Executives at non-union auto plants are swiftly raising wages in response to concerns about heightened UAW influence. Toyota’s wage increase, in particular, is perceived as a preventative measure against UAW’s expanding clout within the industry.

Approximately 146,000 UAW members are currently in the process of voting on new contracts with General Motors, Ford, and Stellantis, contracts that would lead to a 25% general wage increase over the next 4 years and 8 months. Factoring in the cost of living, employees stand to witness a total salary surge of around 33%. The top-tier production line workers could potentially earn up to approximately $42 per hour.

The series of wage increments across automakers reflect a strategic tug-of-war between management and labor unions within the auto industry. As negotiations continue and contracts are decided upon, the potential for a shift in the dynamics of worker influence remains a central concern for both automakers and labor organizations alike.

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