The FBI investigation into the UAW seems to be closing in on its president, UAW asks members to vote on Ford contract, who will lead the new FCA-PSA group, and Elon Musk logs off. All this and more in The Morning Shift for Monday, November 4, 2019.
1st Gear: UAW President Takes Leave Of Absence
In June 2018, the UAW executive board elected Gary Jones their new president. A big reason for doing so was the presumption he was not connected to the federal corruption investigation into the union. Turns out, not so much.
Over the weekend, Gary Jones took a leave of absence as president of the UAW, effective immediately.
Why did Jones step aside? Here’s what he had to say, through a statement, to Reuters:
“The UAW is fighting tooth and nail to ensure our members have a brighter future. I do not want anything to distract from the mission. I want to do what’s best for the members of this great union,” Jones said in the statement, which did not give a reason for his decision.
You may have noticed that was a bunch of words that didn’t actually say why he is taking a leave of absence. To boot, both the UAW and Jones’s lawyer declined to comment to Reuters. So, there’s really only one logical explanation at this point: he isn’t as clean as the executive board might have thought.
To be clear, Jones has thus far not been charged with any wrongdoing. But, in August, the FBI raided Jones’s home, and a source told Reuters Jones is the “UAW Official A” identified in previous criminal complaints in the UAW probe. What did “UAW Official A” do? As Reuters summarized, “The complaints said that officials took part in alleged schemes to embezzle funds from the union.”
Because it’s a leave of absence and not a resignation, Jones is on paid leave, at least for now. Replacing him is Rory Gamble, who led the negotiating team for the new Ford labor deal.
2nd Gear: UAW And Ford Look To Wrap Up Contract Without Fuss
After a prolonged GM strike, which was expected to be the toughest of the Big Three contracts, UAW is not looking for a repeat with Ford. The union is recommending its members ratify a contract with Ford, according to multiple outlets including the Detroit Free Press:
The union contract includes $6 billion in promised “major product investments” in U.S. facilities and the creation and retention of more than 8,500 jobs with 19 facilities receiving investments. You can see the summary online.
It also includes no changes to workers’ share of health care costs, a $9,000 ratification bonus for seniority employees and $3,500 for temporary workers.
Also included is closure of the Romeo Engine Plant.
The UAW managed to keep health care costs stable, which according to the Free Press was “viewed as the single most important issue for Ford.” GM, you may recall, also agreed to that provision in their contract, which set a precedent Ford would have had a tough time breaking.
As for what’s next, here’s the Free Press:
The proposed contract will now go before Ford’s 55,000 union workers to decide to ratify or reject it. Workers will proceed with informational meetings and ratification votes at all Ford local unions. They begin the process Monday and results are due into Detroit on Nov. 15.
There’s a lot more to the contract, of course, and you can check out the top line items of the new contract here.
3rd Gear: Peugeot’s CEO Will Take Over FCA-PSA Conglomerate
As Fiat Chrysler and PSA Group work to finalize their merger, the WSJ reports that, should the merger come to fruition, PSA’s 61-year-old CEO Carlos Tavares will take over the combined entity. And, based on their glowing profile of him, it’s easy to see why:
Peugeot was bleeding cash when it recruited Mr. Tavares in 2013. Under his leadership, PSA has gone from losing €5 billion (about $5.6 billion) in 2012 to last year reporting a net profit of €3.3 billion, with a margin of 8.4% in its core automotive business, making it among the most profitable mass-market car makers in the industry.
He achieved the turnaround in large part by slashing production and preaching the dangers of expanding too fast or chasing sales with discounts. He also trimmed the workforce without closing factories, negotiating an agreement with unions to cut the standard workweek for some employees and eliminate jobs through buyouts.
Tavares left the Ghosn-led Renault-Nissan to rescue Peugeot, and in the process spurned the Ghosn-eque growth-for-growth’s-sake philosophy. Plus, as far as automotive executives go, he sounds fairly chill:
While those auto executives were famous workaholics—jetting around the world to make factory visits—Mr. Tavares is a strict practitioner of work-life balance. His workday generally runs from 8 a.m. to 6:30 p.m., and he makes calls on the drive home before taking the evening off.
He spends many of his weekends at the track, racing cars and competing in events like the 24-hour Le Mans Classic. Last year, he ended that race by spinning off the track in his Lola T70, a classic British race car, before colliding with another car.
“I’m in favor of a life in which you’re not bored to death,” he told motor racing publication Endurance-Info afterward.
As the WSJ points out, rationalizing a global automotive behemoth is a very different challenge than a (basically) one-continent shop. Should the deal go through, all the best to Tavares and, for the love of God, make some damn small cars in the United States.
4th Gear: One Million EV Charging Points By 2030, Merkel Says
Germany should have one million charging stations for electric cars by 2030, Chancellor Angela Merkel said in a video message on Sunday, ahead of meetings on Monday with the car industry on how to speed the move to low-emission battery-powered vehicles.
“For this purpose, we want to create a million charging points by the year 2030 and the industry will have to participate in this effort, that is what we will be talking about,” Merkel said. Germany now has just 20,000 public charging points.
Sure, one million sounds like as good of a number as any, but I’m going to go out on a limb and say the primary barrier to EV adoption is cost of the vehicles, the secondary barrier is lack of charging infrastructure in apartment complexes with parking, and then we can start to talk about public charge points.
5th Gear: Musk Logs Off Years Too Late
Elon Musk had another normal one on Friday:
Godspeed, beautiful boy. We’ll be here when you come crawling back to the foul temptress that is Twitter. Everybody does.
Reverse: King Tut’s Tomb Discovered
Really weak day for history, if I’m being honest, but hey, tombs are cool.
Neutral: Do We Need Millions of EV Charging Points?
Most people who don’t own EVs think about charging them as if it’s like putting gas in a car, which is why they often cite a lack of charging infrastructure as a reason not to buy them. But most of the people I’ve met who actually own EVs think of it more like charging cell phones or laptops, in that they plug them in when they’re home and don’t use public charging stations very often. They also learn they don’t drive nearly as many miles every day as they think they do.
It’s definitely true we need more EV charging points, but in my experience driving them, it’s not so much that we need far more of them than they need to be in more strategic locations instead of wherever they can get plonked down.