Catherwood LibraryILR School

The UAW reached new tentative contract agreements with each of the Big 3 Automakers: Stellanis, General Motors, and Ford. The tentative contracts significantly increase worker salaries, improve employee benefits, and strengthen job security. It is estimated that these changes will result in over one billion dollars of costs for each automotive company. The companies will work to internalize the costs and reduce costs elsewhere by making processes more efficient and less costly. These companies may also increase the prices of their vehicles and pass a portion of the costs onto consumers. It is not clear how much prices will increase due to these tentative agreements, but consumers already witnessed a 25 percent increase in vehicle prices due to the COVID-19 pandemic. Economic research has indicated that consumers may not readily accept price increases, as other vehicles in the market will be maintaining the same price, and would therefore look cheaper in comparison to a vehicle made by one of the Big 3 Automakers