Central Florida Auto Workers have joined the nationwide strikes against Ford, General Motors and Stellantis. Dozens of workers walked out of a Stellantis distribution center in Orlando last week.
WMFE’s Brendan Byrne spoke with Richard Lewin, professor of finance at Rollins College, about the economic impact and historical perspective on the strikes expanding to Florida.
Brendan Byrne: How extraordinary is it to see this strike down here in the southeast of the country?
Richard Lewin: First of all, it's fairly rare. This is area eight of the UAW's region. They have had an extensive membership in the Detroit, Michigan area and most of their activities have been there. Historically, car plants were centered around Detroit. Over the last sort of 50 or 60 years, we've seen a slow expansion south, lots of foreign automobile makers decided to create plants in the southern U.S., in part because it was not historically unionized. So in many respects, it is quite surprised to see a non unionized state of Florida is right to work state.
We have the ability here yet to still have strikes by the UAW. I think our UAW president Sean Fain, who's fairly recently elected, is probably having a bit of a Zelenskyy moment — he can probably see that the guerrilla tactics are starting to work and he wants to be able to extend the reach beyond the Northeast. And so I think that's one of the reasons why we're seeing strikes at the Boggy Creek Road [distribution plant], which is just adjacent to our Orlando International Airport. It is the Stallantis distribution or parts facility that is going on strike.
That is the surprise. First of all, it is not completely unionized, but it does have some union members. I think this is part of a sort of a new type of tactic that's being operated.
Byrne: And it is a distribution center, right? It's not a factory line. How much of an impact does this strike have on the industry at large? And does that help leverage some of these negotiations?
Lewin: I think it's a very smart scare tactic. First of all, you've got to think in terms of the fact that the supply chain now for an automobile might includes 30,000 components. And you can probably realize that you can't actually buy a new car unless all 30,000 components are present at the same time. And therefore, it's an unusual tactic that you hit the logistics and distribution side of it. But actually, it's very effective, because the union probably knows what inventory the major car manufacturers have available local to the actual assembly at the assembly plants. They're probably looking back along the supply chain, with their workers and with their intelligence and knowledge and saying, "where can we create the greatest disruption for the minimum cost?"
And as I mentioned before, it's kind of the Zelenskyy moment in the fact that they didn't attack the whole of the Russian fleet, they just attacked the front vessel because they knew it was the most important, the most prestigious, and it would have the biggest impact, in the same way increasing the scale of the UAW strike. More importantly, the scope of that strike — I think that's the big economic message.
Byrne: Locally here in Central Florida, could there be local impacts because of the strike here? Or is this more of a something that is going to help [strike] efforts at large?
Lewin: Well, from the consumer side, what you're going to notice is the challenges for dealerships to get stock, because obviously, the three automobile makers with the different brands that they represent, require new stock ahead of the new year. This distribution disruption could potentially reduce the number of new vehicles available. Many dealers often are looking to move inventory in the run up to the new year.
I think that's really the tactics — they're ratcheting up in places which they know will have the maximum impact for the minimum cost to the Union. And that's a very smart strategy.
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