Expanded U.S. EV battery production is a cornerstone of the Biden administration's effort to grow the economy while shifting it to less carbon-intensive pursuits. But a new Bloomberg report highlights a potential issue with that plan.
As it negotiates new contracts with the Detroit Three U.S. automakers, the United Auto Workers (UAW) is not happy with the current state of the EV shift, according to the report. And UAW leadership believes that could become a factor in the 2024 Presidential election. Former President Donald Trump has already made the Biden administration's EV policy a talking point, claiming it will "decimate" auto industry jobs.
Site of planned Toyota Battery Manufacturing North Carolina (TBMNC) battery plant
"I have cautioned everybody in Washington, D.C., that they better understand one thing—our workers' experience right now with this EV transition is not a good thing," UAW president Shawn Fain said in an interview with Bloomberg. "So when somebody else comes along and says 'Get ready to watch your jobs disappear,' that is gonna resonate."
The main issue, according to the report, is whether workers at new battery plants being built—many in red states—to support expanded EV production will earn comparable wages to assembly-line workers. Employees at the GM-LG Ultium Cells LLC joint venture battery plant in Ohio start at $15.50 an hour, half the top wage at assembly plants, according to the report. Low wages could be a hedge against overall battery costs, which have soared due to increasing raw materials costs.
Artist's impression of Ultium Cells' battery plant in Lordstown, Ohio
Unionized GM assembly plants currently build the Chevrolet Bolt EV, Cadillac Lyriq, and GMC Hummer EV, and will soon build the Chevy Silverado EV and GMC Sierra EV pickups. Unionization has been slow to materialize at the various new battery plants. A planned Ford battery plant in Michigan may be one of the first under the UAW aegis.
President Biden has said from the start he wants good union jobs for these new roles in making EVs. But so far job counts have gone down in vehicle assembly, and if lower wages at mostly non-unionized battery plants are the prevailing trend, that won't be an adequate replacement for lost assembly jobs.