Nearly 1,000 United Auto Workers members walked off the job at midnight Sunday at American Axle's Three Rivers plant, threatening production of GM's most profitable pickup trucks over wages that remain half their pre-2008 recession levels.
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UAW strikes GM axle supplier as 1,000 workers demand wage restoration
United Auto Workers President Shawn Fain called a strike at a Michigan factory that makes axles for General Motors pickup trucks, some of the automaker's most profitable vehicles, after contract negotiations failed to restore wages slashed during the 2008 recession.
"Workers at American Axle in Three Rivers make axles for the GMC Sierra and the Chevrolet Silverado — GM's half-ton pickup trucks," Fain said in a social media livestream Sunday night, two hours before the midnight deadline. "No contract, no axles."
The walkout involves roughly 1,000 members of UAW Local 2093 at the Dauch Corp facility, formerly known as American Axle & Manufacturing. The plant is the company's largest manufacturing site in Michigan and a critical node in GM's supply chain: the Sierra and Silverado are assembled in Flint using axles produced in Three Rivers. A prolonged strike could halt production lines for GM's highest-margin vehicles, which generate tens of billions in annual revenue for the Detroit automaker.
At the heart of the dispute is a wage structure frozen in time. During the 2008 recession, with American Axle on the brink of closure, workers accepted pay cuts from $29 an hour to $14.50 an hour to keep the plant open. Eighteen years later, the top wage for union members has recovered to only $22 an hour — roughly half the inflation-adjusted equivalent of $44 an hour that the pre-recession wage would command today, according to Bureau of Labor Statistics data. The union says American Axle has returned to profitability and generated $8.4 billion in profit over the past decade.
A Decade of Profit, a Generation of Concessions
Josh Jager, Local 2093 bargaining chair, was among the workers who took the 2008 pay cut. "We did it to save the company, we did more than save them — we made them billions of dollars," Jager said. "So tonight, it's about getting our fair share."
Workers voted 98% in favor of authorizing a strike in early May, signaling deep frustration with the pace of negotiations. The UAW's Department of Bargaining Strategies and Fain's office both participated in talks but were unable to secure a deal. The union has accused American Axle of failing to bring a meaningful offer to the table over the past three weeks.
American Axle did not respond to requests for comment. The company, which rebranded as Dauch Corp, supplies driveline and axle components to several automakers, but GM is its most significant customer. The last time a strike hit a critical GM parts supplier was during the UAW's 2023 stand-up strikes against the Detroit Three, which cost the automakers billions in lost production.
Supply Chain Risk and the Broader Labor Landscape
The strike comes at a moment of heightened labor activism in the auto sector. Fain, elected in 2023 on a reform platform, has used social media livestreams and aggressive bargaining tactics to press for wage gains across the industry. The 2023 strikes against Stellantis, GM and Ford secured 25% wage increases over four years, but those gains largely bypassed parts suppliers like American Axle.
For GM, the timing is particularly sensitive. Pickup trucks are the backbone of its North American profits, with the Silverado and Sierra generating estimated margins of more than $10,000 per vehicle. Any disruption to axle supply could force the Flint assembly plant to idle, reducing GM's earnings before the company reports second-quarter results in July.
The broader auto supply chain remains vulnerable to labor disruptions. The last major strike at American Axle, in 2008, lasted 86 days and cost the company $200 million in lost revenue before workers accepted the wage cuts that are now at the center of the current dispute. If history is any guide, a prolonged walkout could ripple beyond GM to affect dealership inventories and parts availability across North America.
This article is for informational purposes only and does not constitute investment advice.
