By Nora Eckert and David Shepardson
DETROIT/WASHINGTON (Reuters) -Volkswagen said Wednesday it is offering its newly unionized workers at its Tennessee assembly plant a 14% wage increase over four years and profit sharing.
The automaker and United Auto Workers union, which won the right to represent workers at the Chattanooga, Tennessee facility in April, have been engaged in contract talks for several months. VW said the company's offer includes profit sharing for the first time and improves healthcare benefits for hourly workers at the plant.
UAW-VW Bargaining Committee member Yogi Peoples criticized the offer.
"We’ve been bargaining for months, and VW is still not taking our demands seriously. With the record profits they’ve made and the dividend schemes they’ve used to pad the pockets of shareholders, there’s more than enough money to meet our demands for a record contract," Peoples said in a statement.
UAW President Shawn Fain's victory at the VW plant made it the first auto plant in the South to unionize via election since the 1940s and the first foreign-owned auto plant in the South to do so.
Fain clinched the win after riding the momentum from a successful campaign in Detroit in late 2023. After a six-week strike against Ford (NYSE:F), General Motors (NYSE:GM) and Stellantis (NYSE:STLA) the union notched 25% general wage increases plus cost of living adjustments for their workers.
Fain and the UAW faced a setback in May, when workers at a Mercedes plant in Alabama voted against unionization. The labor group is attempting to organize more than a dozen non-union automakers across the nation, including Toyota Motor (NYSE:TM) and Tesla (NASDAQ:TSLA).
VW in Germany is also in a tense back-and-forth with unions after a record number of workers went on strike. The automaker is trying to cut costs to compete with Asian carmakers, warning of significant job losses or plant closures.