United Auto Workers President Accuses Stellantis CEO of Price Gouging Consumers and Contract Violations
ICARO Media Group
In an escalating war of words, United Auto Workers (UAW) President Shawn Fain has unleashed scathing criticism against Stellantis CEO Carlos Tavares, accusing him of price gouging consumers and failing to honor parts of the union's labor contract with the automaker. Fain's comments come as the latest episode in the ongoing feud between the CEO and the union leader following contentious collective bargaining talks last year.
In a video posted on Friday, Fain wasted no time in launching his verbal attack. "Something is rotten at Stellantis," he declared. Highlighting a decline in sales and profits coupled with a substantial increase in CEO pay, Fain shifted blame away from the market and the auto workers, squarely placing it on Tavares. He accused the CEO of resorting to price gouging to boost profits, pointing out that Stellantis has been selling fewer cars while making more money, a clear sign of unfair practices.
But Fain didn't stop there. He also alleged that Stellantis was in breach of the company's worker contract. Specifically, he claimed that the automaker was reneging on commitments made in the last agreement, including their decision to halt plans of reopening the Belvidere Assembly in Illinois. These accusations mark a significant escalation in Fain's criticism, targeting Tavares for his actions on both consumer pricing and workers' rights.
Neither the union nor the automaker has responded to Fain's allegations and video at the time of writing. While some of the criticisms, such as job cuts and Tavares' pay, have been previously raised, Fain's recent comments take it a step further, portraying the CEO as engaging in consumer exploitation for financial gain. Moreover, the UAW president asserts that Stellantis is failing to uphold their contractual obligations, potentially causing turmoil within the worker community.
This exchange between Fain and Tavares is emblematic of a troubled relationship, with both sides laying blame on each other. Tavares, in recent statements, criticized the UAW-Stellantis workforce, citing quality issues at a truck plant in metro Detroit. The company has also announced significant layoffs in the face of declining sales and strategic changes. Tavares insists that these cost-cutting measures are necessary to fulfill his ambitious plan to increase profits and double revenue by 2030.
Stellantis, formed through the merger of Fiat Chrysler and PSA Groupe in January 2021, has been implementing extensive cost-saving measures, including supply chain and operational reshaping, as well as workforce reductions. Public filings reveal that the company has already reduced its headcount by 15.5% (approximately 47,500 employees) between December 2019 and the end of 2023, with a 14.5% reduction in North America alone. Despite criticisms from executives about the extensive nature of the cuts, Tavares defends the company's cost-cutting efforts, denying any direct connection to its current challenges.
As the feud between Fain and Tavares continues to intensify, the future relationship between the UAW and Stellantis remains uncertain. The accusations of price gouging and contract violations add fuel to the ongoing discord, raising questions about corporate responsibility, worker rights, and the overall integrity of the automotive industry.
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