Tesla CEO Elon Musk is no fan of unions, but right now he might be quietly cheering on Shawn Fain. The United Auto Workers leader shows no signs of backing down from Detroit’s Big 3 automakers as he imposes ‘bold’ contract demands. If no deal is reached, about 146,000 UAW workers are likely to go on strike Friday.
That would help Tesla at a time when traditional automakers are moving more aggressively into electric vehicles.
“If a strike were to occur, production and the EV roadmap could ultimately be pushed to 2024 and delays would be on the horizon during this crucial period for GM, Ford and Stellantis,” Wedbush analyst Dan Ives wrote in a research note. Tesla is well-positioned to benefit from any work stoppages at its rivals, he added.
“I think this is going to be the most serious and dramatic strike in 50 years,” Erik Gordon, a business professor at the University of Michigan, told WNEM. Barclays analyst Dan Levy, meanwhile, called a strike “very likely.”
In addition to slowing down Detroit’s automakers, a strike would also hurt their bottom line. One against GM, Ford and Stellantis that would last 10 days would cost them almost a billion dollars, according to the Anderson Economic Group.
While Detroit automakers had nearly 2 million vehicles in stock at the end of July, “a work stoppage of three weeks or more would quickly drain excess supply, raise auto prices and spur more sales to non-union brands,” said analyst Sam Fiorani. told the Associated Press.
One of those brands is of course Tesla.
Musk has taken a tough stance against organized labor. Tesla employees earn about $45 an hour in wages and benefits, while UAW-represented employees at the Detroit Three earn about $64 to $67 an hour, according to Reuters. The gap gives Tesla a competitive advantage, as do different production strategies and not having to share profits with dealers.
In March, a three-judge panel ruled that Musk had unlawfully threatened employees with the loss of stock options if they chose to be represented by a union. In July, a federal appeals court said it would reconsider the ruling.
The heart of the matter was a 2018 tweet in which Musk wrote: “There is nothing stopping the Tesla team at our car factory from voting for a union. Could do this if they wanted to. But why pay union dues and give up stock options for nothing? Our safety record is two times better than when the plant was UAW and everyone already gets health care.”
In February, workers at a Tesla factory in Buffalo were fired shortly after they began unionizing. Workers United said the terminations were an illegal form of retaliation. Tesla denied this and wrote on its blog that it had decided to fire the workers in advance due to poor performance.
Tesla has pressured other automakers with dramatic price cuts this year, often angering its own customers who bought vehicles at higher prices weeks or days before the cuts — or who were about to sell a used Tesla that suddenly lost value .
Also worrying Detroit’s major automakers are EV rivals emerging in China and exporting to Europe and elsewhere – but not yet to America. “The Chinese will be the powerhouse,” Ford CEO Jim Farley said at a financial event in May.
Ford Chairman Bill Ford Jr. added in June: “They are not here, but they will come here… and we have to be ready.”
Tesla may be more ready than its Detroit rivals, and there’s no strike on the horizon.
This story originally appeared on Fortune.com
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