Volkswagen workers in Chattanooga, Tennessee, voted to ratify their first union contract on Thursday, marking a major win for the United Auto Workers in the South. Under the four-year pact, workers are set to receive 20% wage increases, as well as improvements in healthcare and job security.
Earlier, workers had voted twice against joining the union before voting in favor in 2024. This made the VW plant one of the few to unionize in the South, and a rare one that is not part of the “Big Three” automakers — Ford, General Motors and Stellantis. This was two years ago, and negotiations have dragged on since, with workers at one point granting the union the ability to call a strike if necessary.
Contract talks were resolved in early February when the UAW and Volkswagen struck a tentative agreement, which the workers voted to approve. 96% of the workers voted “yes.”
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“Today you showed the world Southern autoworkers are ready to fight,” UAW President Shawn Fain said to workers after the results of the vote came in.
“And to all the other non-union autoworkers out there,” he continued, “come on in. The water’s fine.”
Volkswagen officials said in a statement after the tentative contract was announced, “These benefits recognize and reward the hard work and dedication our team members give every day.”
Workers will immediately get a $6,550 bonus when the contract goes into effect Monday as well as a 20% wage increase across the life of the contract, which ends in February 2030. By then, the top hourly wage for production workers will be $39.41, and $49.86 for skilled workers like machinists and electricians, whose jobs require more education and training. That top wage does not include cost of living adjustments that are also in the contract.
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Healthcare premiums will also be reduced by 20%, or more from some plans, and won’t go up for four years. The contract also gives workers two additional days off, and guarantees them some job security benefits.
Tony Bodewes, who worked at the plant for five years, and was part of the UAW’s bargaining committee said “It’s very important for us and for the company to show to the workers that they are committed to this city. They’re not going anywhere.”
The union reportedly aimed to match the gains recently seen in Detroit in 2023 that followed a six-week strike at Ford Motor , General Motors and Stellantis, and resulted in a 25% wage increase and cost-of-living adjustments.