(Bloomberg) -- Tesla Inc. Chief Executive Officer Elon Musk blasted the United Auto Workers Tuesday, saying the union’s demands would “drive GM, Ford and Chrysler bankrupt in the fast lane.” Most Read from BloombergChina Puts Evergrande’s Billionaire Founder Under Police ControlDimon Warns 7%...
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(Bloomberg) -- Tesla Inc. Chief Executive Officer Elon Musk blasted the United Auto Workers Tuesday, saying the union’s demands would “drive GM, Ford and Chrysler bankrupt in the fast lane.”
Tesla and other pure electric vehicle companies like Lucid Group Inc. and Rivian Automotive Inc. are not unionized. They typically use restricted stock units and employee stock purchase plans for a big part of overall compensation. The UAW worries that EVs, which typically require fewer moving parts and fewer workers to make, will cost them jobs and reduce wages.
Musk is not alone in saying that a big win for the UAW could mean trouble for Detroit’s automakers.
“If the UAW gets everything they are asking for, it will very clearly damage the competitiveness of the Big Three companies materially,” Patrick Kaser, portfolio manager for Brandywine Global, said in an interview last week.
If you are the Detroit Three, you are running two operating systems,” said K. Venkatesh Prasad, senior vice president of research and chief innovation officer for the Center for Automotive Research in Ann Arbor, Michigan, in a phone interview. “The profits you make on ICE vehicles is what is funding the transformation to EVs, which are not going to be profitable for a while.”
“The biggest competitive advantage Tesla has it they are not managing two systems,” he added. “They only have one.”
