WASHINGTON, June 23 (Reuters) – United Auto Workers (UAW) union President Shawn Fain on Friday harshly criticized the U.S. Energy Department plan to lend $9.2 billion to a joint venture of Ford Motor (F.N) and South Korea’s SK On to build three U.S. battery plants.
Fain called the loan a massive “giveaway” with “no consideration for wages, working conditions, union rights or retirement security” that would help create low-paying jobs adding, “Why is Joe Biden’s administration facilitating this corporate greed with taxpayer money?”
The wages of workers at battery JV plants are expected to be a key issue in contract talks that start next month with the Detroit Three automakers.
The $9.2 billion low-cost government loan for the BlueOval SK joint venture is the biggest ever from the government auto lending program that will help finance construction of three plants in Kentucky and Tennessee. SK is a unit of South Korea’s SK Innovation (096770.KS).
The joint venture is building battery plants in Kentucky and Tennessee.
Ford on Friday said it “expects that BlueOval SK will pay competitive wages and benefits to attract and retain the workforce needed to build high-tech batteries” and added that workers “will be able to choose whether they organize, a right that Ford fully respects and supports.”
The White House said Biden and UAW are working toward the same goal — “to ensure the future of the auto industry is made here in America, with good-paying, union jobs. … The president respects the UAW for working hard for the interests of the working people they represent, and the president will keep working hard toward that goal as well.”
The UAW in May said it was not yet endorsing Biden for reelection, citing his electric vehicle policies.
“Not only is the federal government not using its power to turn the tide – they’re actively funding the race to the bottom with billions in public money,” the UAW said on Friday.
The UAW and Senator Bernie Sanders in April criticized a General Motors (GM.N)/LG Energy Solution (373220.KS) joint venture battery plant for paying workers much less than GM assembly plant employees even though it benefits from hefty U.S. government tax credits.
The starting salary for workers at a Warren, Ohio, JV Ultium Cells plant is $16.50 an hour, which rises to $20 an hour after seven years. Union workers at a nearby Ohio GM assembly plant that closed in 2019 made at least $32 an hour.
The Energy Department last year awarded $2.5 billion to help finance construction of Ultium’s new lithium-ion battery plants, including Warren, from the same program used for the Ford loan.
