Hyundai has now joined Toyota and Honda in raising wages for factory workers after the United Auto Workers won a new contract agreement. Like the Big Three, Hyundai has plenty of factories in America and was likely worried about the strike eventually affecting Hyundai dealers around the country if it continued. Hyundai will raise wages by 25% by 2028.
Hyundai Raises Appear Higher Than Toyota and Honda
Compared to Toyota and Honda, Hyundai has agreed to raise factory worker wages by a higher amount. Toyota is planning to raise wages by 9% or 10% starting in January, and Honda said it would increase wages by 11% during the same period. The increases are likely aimed at stopping the UAW from organizing workers at plants run by foreign automakers.
Toyota’s pay increase was the lowest of the three foreign automakers that participated and is being succinctly referred to as the UAW bump. Roughly 146,000 UAW members are voting on contracts with the Big Three that will give them the 25% wage increase by 2028. This amount actually rises to 33% when cost of living wages are included.
Toyota and Honda decreased the time it takes for a new employee to reach the top pay rate, which matches or comes close to the time in the new UAW contracts. It’s obvious to most experts that the UAW settlement is the main reason behind nonunion raises.
Hyundai Stays Mum
Hyundai didn’t say how much the hourly wage currently is at its Montgomery, Alabama factory, nor did the automaker say how much it will pay workers at the upcoming EV factory being built in Savannah, Georgia. However, Hyundai did say that by early 2024 it will have increased factory worker pay by 14% over the past year.
Estimates say that Hyundai likely pays around $25 per hour and the nonunion benefits for health care and retirement aren’t as good as what UAW members get. Hyundai made a statement that the company strives to provide competitive wages and similar benefits to rivals in the industry.
Meanwhile, the strike isn’t anticipated to have any effect on your local Hyundai dealer, though there was concern early on that the strike could have affected inventory at dealers across the country.
UAW Wins Through Leverage
On the Toyota and Honda fronts, Toyota’s top pay will be $34.80 per hour in January. Honda did not reveal what it pays, but experts think it’s similar to Toyota. The new UAW contract likely won’t help nonunion workers to join as the plants tend to be in areas that are suspicious of unions.
As previously mentioned, the nonunion workers are getting some mirrored pay raises as the foreign automakers want to stay competitive and keep up with rivals. However, experts don’t think that this will cause nonunion workers to organize or join UAW. There simply isn’t enough interest in many cases.
It’s not clear what, if any, effect the new pay raises will have on prices at your Hyundai dealer or any other dealer. Voices on the side of the Big Three initially expressed skepticism that the contract would be good for their own economic condition.
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