The UAW may carry out targeted strikes if deals with automakers are not reached

DETROIT — The United Auto Workers union plans to carry out targeted strikes at certain plants against Detroit automakers if tentative contracts with General Motors, Ford Motor Co. and Stellantis are not reached, union officials familiar with the matter said Tuesday night.

That plan could change depending on how negotiations proceed as of 11:59 p.m. ET Thursday, according to two sources who spoke to CNBC on condition of anonymity because the plans have not been announced to union members.

Targeted strikes refer to work stoppages only at some plants involving local contract issues that plague many, if not most, plants. This compares to national strikes where all union members walk out of plants, which occurred four years ago during the last round of negotiations against GM.

UAW President Sean Fine is expected to outline the strike strategy to members of the broader union at 5pm ET on Wednesday during a Facebook Live event.

Fine and other leaders have consistently said they have a plan if deals aren’t reached by the deadline, including potentially striking all three automakers and having the roughly 146,000 UAW members head to picket lines instead of factory lines.

Carrying out targeted strikes can be complicated, because it is not clear how one plant will affect others. These measures would potentially send non-striking union members to the unemployment lines, if their state allows them to collect any benefits due to being unemployed as a result of the strike.

Companies can also respond by choosing to lock out workers (refuse to hire) or by hiring permanent replacement employees for striking workers.

Targeted strikes will save the union money, as it will not have to pay “strike pay” to as many members from its $825 million strike fund.

The fund pays each eligible member $500 a week, meaning it has enough money to last about 11 weeks if everyone goes on strike. However, this does not include health care costs that the union would cover, such as temporary COBRA plans, which would likely exhaust funding much more quickly.

The UAW declined to comment on the strategy, which was first reported Tuesday By Detroit Free Press. The newspaper said that the plan was called “a standing strike instead of the sit-in strike in 1936 and 1937.”

After reports of the union plan, Ford CEO Jim Farley said late Tuesday night that the company remains “optimistic that we can reach an agreement with the UAW in the next couple of days.”

Farley said negotiators are sleeping in the company’s offices as they try to finalize an agreement with the union.