Could workers in a Southern state join an auto union?

A worker checking a Volkswagen Golf model on a production line.

Workers at the Volkswagen plant in Chattanooga, Tennessee will vote on whether they want union representation on Wednesday through Friday. Gov. Bill Haslam* and Sen. Jack Johnson (who is also chair of the state's Commerce and Labor Committee), both oppose the union moving in.

There are two big reasons foreign auto makers who want to build cars in the U.S. look to the Southeast: cheaper labor and generous state incentives. The United Auto Workers union has tried to organize in America's foreign auto plants in previous years, without much success.

"One of our big selling points is that we are right-to-work, and quite frankly I don't think they need that union organization for the benefit of the employees," Johnson argued.

As far as pay disputes and potential strikes? That's going to be tricky for United Auto Workers. 

"I think the UAW does not have an incentive to go in there and jam up wages super-high in such a way that it makes Volkswagen fail," says Aaron Sojourner, a labor economist at the University of Minnesota. Sojourner says if that happens, the union can kiss goodbye any hope of getting into more foreign-owned factories, especially in the South.


*CORRECTION: An earlier version of this article incorrectly identified the governor of Tennessee. It's Bill Haslam. The text has been corrected.


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What sort of one-sided journalism is this, Marketplace? Of course the UAW and the manufacturing employees ought to unionize the Chattanooga Volkswagon plant.
What was not mentioned at all in the report is that nearly all auto workers in Germany are union members. According to Forbes, in 2010, "the average auto worker in Germany made $67.14 per hour in salary and benefits; the average one in the U.S. made $33.77 per hour." This at a time when Germany manufactured more than twice the automobiles of the United states while reaping a handsome profit. By comparison, "At Volkswagen’s Chattanooga plant, the nonunionized new employees get $14.50 an hour, which rises to $19.50 after three years."
What the UAW needs to do is hire experienced German union negotiators to reach an equitable compromise with VW. It is important, culturally, because the union-management relationships in Europe are more collaborative than those in the states.
Volkswagon does not pay its non-union workers so little to meet the going rate - Volkswagon pays its non-union American workers a fraction of what they pay their European workers is simply because they can.

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