Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
An escalating strike against Tesla by a group of Swedish unions has been branded “insane” by Elon Musk as the industrial action threatens to disrupt the US carmaker’s operations in other parts of Europe.
Around 130 mechanics in Sweden, who belong to the IF Metall union and service the electric cars, went on strike last month after Tesla turned down their request for collective bargaining.
Dockworkers and car dealers have since refused to work with the brand, in sympathy strikes that threaten to harm the company’s business in Sweden and potentially further afield. The latest strike by postal workers means that Tesla cars will not have their licence plates delivered to customers.
Musk, Tesla’s chief executive and a staunch critic of unionisation, wrote that the situation “is insane”, in a post on the X social media platform he owns.
Tesla has so far avoided collective bargaining in its global operations despite opening a factory in Germany, where auto unions are powerful.
“This has been a huge cultural shock to Elon,” said Matthias Schmidt, an independent European auto analyst. “He has gone out of his way to avoid unionisation, but this is a huge wake-up call.”
The largest risk to Tesla now is that unions in other nations, especially Germany, opt to join the strike in solidarity with their Swedish counterparts, said analysts.
While the company once relied on imports from China, Tesla’s Berlin factory now accounts for almost three-quarters of the models it sells in the region.
“It could snowball into different countries and be replicated elsewhere,” warned Schmidt. “The biggest risk is obviously Germany. We expected something similar to happen in Germany when they opened their plant there, with the unions being so strong.”
Sweden is a modest market for the carmaker, and dwarfed by its main markets of UK, Germany and France.
Trade unionists and academics in Sweden believe their decades-long labour model could be undermined if Tesla is allowed to operate without a union agreement. “Our Swedish labour model with collective agreements is a competitive advantage in the global market, not a threat,” said Marie Nilsson, president of the IF Metall union.
Tesla may also face rising demands for unionisation elsewhere in its global network.
The United Autoworkers Union, the influential US union, is targeting Tesla as it aims to widen its base beyond the traditional Detroit carmakers of Ford, General Motors and Chrysler following its historic pay deal reached last month.
Read the full article here
