The United Auto Workers’s historic stand-off with Detroit’s three car-making giants is centred on an age-old tension: The union says corporate greed is keeping workers from earning fair wages while Ford Motor, General Motors and Stellantis say they cannot afford union demands.
While both arguments have some merit, one fact stands out: The 10 people who have served as chief executive officers of the companies since 2010 have collected more than $1 billion in compensation. Meanwhile, the wages of US car workers – unionised or not – have declined by about 17 per cent in that time frame.
This reality underpins the strike now entering its fifth week that is playing out against the backdrop of growing income inequality and rising executive compensation.
“We went backward in wages in the last 15 years,” UAW president Sean Fain told reporters last month. “Hell, most of our members can’t even afford to buy what we make.”
The $1 billion total that Detroit automotive chief executives have taken home includes salaries, bonuses, the value of stock awards, fringe benefits and special payouts linked to retirement or corporate transactions.
A representative for Stellantis noted that recent mergers resulted in large one-time pay packages for the previous chief executives.
The median worker at GM and Ford earned $80,034 and $74,691 in 2022, respectively. Stellantis, which is based in the Netherlands, paid its average employee €64,328 ($67,800) last year.
At both GM and Ford, that puts chief executive-to-worker pay ratios higher than the average among the biggest publicly traded US companies, according to data compiled by Bloomberg.
Stellantis said that it has distributed more than €2 billion in profit-sharing to employees under the current chief executive Carlos Tavares.
In filings, each of the companies say that most chief executive awards are tied to performance targets. If results worsen, payouts shrink. GM chief executive Mary Barra said as much in a recent interview, noting that 92 per cent of her pay was based on performance of the company.
However, each of the current chief executives gets an annual salary of at least $1.7 million, regardless of performance.
While the amounts make for good picket-line material, they are not unique. Corporate boards across industries have for decades doled out bigger and bigger packages to chief executives, leading to a growing divergence between how corporations in the US and beyond have rewarded workers relative to their top bosses.
Wages are one of the major sticking points in union negotiations. The UAW initially asked for 40 per cent increases and wants to emerge from its strikes with at least 30 per cent raises, sources said.
So far, Ford says its offer of a 23 per cent raise is as high as it can go while GM and Stellantis have been reluctant to offer much more than roughly 20 per cent increases.
There is good reason for the ask: Since 2003, the average hourly wage for US car workers has declined about 30 per cent, according to the Bureau of Labour Statistics.
Among the factors contributing to this trend was the rise of non-unionised car production in the US and the UAW agreeing in 2007 to lower wages for new hires at the Detroit Three's plants.
While Fain has described what some of his members make as “poverty wages”, those employed in vehicle manufacturing still make more than the average private-sector worker – albeit by a narrowing gap.
UAW members also make more than non-unionised workers in the sector.
GM’s chief executive Barra has said the company’s labour costs are already $22 an hour more than electric-vehicle leader Tesla, and that this competitive disadvantage would only grow as a result of the UAW’s requests.
Fain has made it part of his mission to undo concessions agreed to during the Great Recession. Among the benefits sacrificed were pensions – any worker hired before 2008 has one; anyone who has joined since does not.
Legions of companies across industries have scrapped or frozen pension plans because they are costly. One study found that companies save 13.5 per cent on long-term employee payroll costs when they freeze defined pension benefits.
Specs
Engine: Dual-motor all-wheel-drive electric
Range: Up to 610km
Power: 905hp
Torque: 985Nm
Price: From Dh439,000
Available: Now
What sanctions would be reimposed?
Under ‘snapback’, measures imposed on Iran by the UN Security Council in six resolutions would be restored, including:
- An arms embargo
- A ban on uranium enrichment and reprocessing
- A ban on launches and other activities with ballistic missiles capable of delivering nuclear weapons, as well as ballistic missile technology transfer and technical assistance
- A targeted global asset freeze and travel ban on Iranian individuals and entities
- Authorisation for countries to inspect Iran Air Cargo and Islamic Republic of Iran Shipping Lines cargoes for banned goods
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
The Travel Diaries of Albert Einstein The Far East, Palestine, and Spain, 1922 – 1923
Editor Ze’ev Rosenkranz
Princeton
The Florida Project
Director: Sean Baker
Starring: Bria Vinaite, Brooklynn Prince, Willem Dafoe
Four stars
SHOW COURTS ORDER OF PLAY
Centre Court (4pm UAE/12pm GMT)
Victoria Azarenka (BLR) v Heather Watson (GBR)
Rafael Nadal (ESP x4) v Karen Khachanov (RUS x30)
Andy Murray (GBR x1) v Fabio Fognini (ITA x28)
Court 1 (4pm UAE)
Steve Johnson (USA x26) v Marin Cilic (CRO x7)
Johanna Konta (GBR x6) v Maria Sakkari (GRE)
Naomi Osaka (JPN) v Venus Williams (USA x10)
Court 2 (2.30pm UAE)
Aljaz Bedene (GBR) v Gilles Muller (LUX x16)
Peng Shuai (CHN) v Simona Halep (ROM x2)
Jelena Ostapenko (LAT x13) v Camila Giorgi (ITA)
Jo-Wilfried Tsonga (FRA x12) v Sam Querrey (USA x24)
Court 3 (2.30pm UAE)
Kei Nishikori (JPN x9) v Roberto Bautista Agut (ESP x18)
Carina Witthoeft (GER) v Elina Svitolina (UKR x4)
Court 12 (2.30pm UAE)
Dominika Cibulkova (SVK x8) v Ana Konjuh (CRO x27)
Kevin Anderson (RSA) v Ruben Bemelmans (BEL)
Court 18 (2.30pm UAE)
Caroline Garcia (FRA x21) v Madison Brengle (USA)
Benoit Paire (FRA) v Jerzy Janowicz (POL)
Dubai Creek Open in numbers
- The Dubai Creek Open is the 10th tournament on this year's Mena Tour
- It is the first of five events before the season-concluding Mena Tour Championship
- This week's field comprises 120 players, 21 of which are amateurs
- 15 previous Mena Tour winners are competing at Dubai Creek Golf and Yacht Club
The past winners
2009 - Sebastian Vettel (Red Bull)
2010 - Sebastian Vettel (Red Bull)
2011 - Lewis Hamilton (McLaren)
2012 - Kimi Raikkonen (Lotus)
2013 - Sebastian Vettel (Red Bull)
2014 - Lewis Hamilton (Mercedes)
2015 - Nico Rosberg (Mercedes)
2016 - Lewis Hamilton (Mercedes)
2017 - Valtteri Bottas (Mercedes)
Skoda Superb Specs
Engine: 2-litre TSI petrol
Power: 190hp
Torque: 320Nm
Price: From Dh147,000
Available: Now
RoboCop%3A%20Rogue%20City
%3Cp%3E%3Cstrong%3EDeveloper%3A%20%3C%2Fstrong%3ETeyon%3Cbr%3E%3Cstrong%3EPublisher%3A%20%3C%2Fstrong%3ENacon%3Cbr%3E%3Cstrong%3EConsole%3A%3C%2Fstrong%3E%20PlayStation%205%2C%20Xbox%20Series%20X%2FS%20and%20PC%3Cbr%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E3%2F5%3C%2Fp%3E%0A
What can victims do?
Always use only regulated platforms
Stop all transactions and communication on suspicion
Save all evidence (screenshots, chat logs, transaction IDs)
Report to local authorities
Warn others to prevent further harm
Courtesy: Crystal Intelligence
