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Swedish Union Causes Surprise for US Electric Car Manufacturer

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Swedish Union Causes Surprise for US Electric Car Manufacturer

Tesla Faces First-Ever Strike After Refusing to Negotiate With Swedish Trade Union

Tesla is experiencing its first-ever strike after refusing to engage in negotiations with the Swedish trade union IF Metall. The strike comes as no surprise, given that Sweden is one of the most unionized countries in the world. According to IndustriALL, this strike is the first formal labor action against Tesla globally.

The strike was initiated by IF Metall, which demanded a collective agreement for Tesla’s employees in repair shops across Sweden. After five years of refusal by Tesla’s Swedish subsidiary, TM Sweden, to negotiate such an agreement, the union issued a strike notice limited to its own members within the company. This initially impacted around 120 mechanics and service technicians, as there are no Tesla factories in Sweden.

However, when TM Sweden representatives withdrew from further negotiations after a meeting with IF Metall, the union expanded the strike notice to include all repair shops servicing Tesla vehicles in Sweden, not just Tesla’s own facilities. This broader phase of the strike will affect an additional 470 workers at 16 work sites, starting on Friday. Union members in the targeted shops will be prohibited from performing any work on Tesla vehicles, including servicing, repairs, or preparing new cars for shipment.

This strike is significant not only for Tesla but also for Swedish unions, as it aims to safeguard the country’s recognized labor-market model. The Swedish model relies on collective agreements, covering 90% of all employees and ensuring fair competition and decent working conditions. Refusing to negotiate collective agreements is seen as unfair competition and a potential threat to the model.

The conflict holds symbolic significance for Tesla as well. While the material cost of signing a union contract in Sweden is negligible for the company, the symbolic implications could be more substantial. A concession in Sweden might embolden union demands in other countries where a larger portion of Tesla’s employees work.

Tesla is also facing pressure from other unions. The president of the German industrial union IG Metall recently warned Tesla about the different labor rules in Germany, referencing the company’s opposition to union organizing near Berlin. In the United States, the ongoing strikes by the United Auto Workers against major vehicle manufacturers could also influence union interest among Tesla workers.

The outcome of the Swedish strike is uncertain, but it is evident that the union-busting methods employed by Tesla in the US will not be tolerated in Sweden. The conflict could have wider implications for promoting just transitions in the rapidly growing electric vehicle industry. Politicians are also recognizing the importance of union contracts in combating inequality and ensuring decent jobs in this sector. Overall, this seemingly small strike in Sweden holds considerable significance for Tesla and the broader labor movement.

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