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For Tesla and Musk, Auto Strike Carries Benefits and Risks [1]

['Jack Ewing', 'More About Jack Ewing']

Date: 2023-09-21

Yet labor organizing is arduous. Activists must get at least 30 percent of workers to sign union cards and force a vote overseen by the National Labor Relations Board. Companies often do all they can to dissuade workers from joining, hiring lawyers and consultants who specialize in defeating union campaigns.

Even if a majority of workers cast ballots in favor of a union, winning pay increases and better benefits comes only after negotiations that can drag for years. Amazon workers at a Staten Island warehouse voted in April 2022 to unionize, but Amazon has challenged the result and has yet to begin bargaining on a contract.

Still, Tesla would be a tempting target for unions. The company reported profit of $2.7 billion on sales of $25 billion in the second quarter, giving it a profit margin of about 11 percent. That profit margin is more than that of Ford or G.M., even after an exceptionally profitable period for those companies. Stellantis, which was created by the 2021 merger of Fiat Chrysler and Peugeot, reported an 11 percent profit margin in the first six months of the year, but lost market share in the United States.

Tesla’s stronger financial performance has allowed it to significantly cut car prices, making it harder for the established carmakers to gain ground in electric vehicles. The least expensive Model 3 sedan costs about $33,000 after federal tax credits, less than comparable gasoline vehicles.

The climate for organized labor is better than it has been for years. President Biden is a big supporter of unions. Hollywood writers and actors are on strike, a high-profile manifestation of labor activism. In August, United Parcel Service employees won their biggest raises ever in a contract negotiated by the International Brotherhood of Teamsters.

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[1] Url: https://www.nytimes.com/2023/09/21/business/tesla-musk-auto-union.html

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