United Auto Workers members overwhelmingly approved a four-year contract with Volkswagen AG, a groundbreaking win for the union that has struggled to organize southern auto plants.
Employees at an assembly plant in Chattanooga, Tenn., voted 96% in favor of a tentative agreement with Volkswagen, the union said Thursday. The contract, reached earlier this month, secured a 20% across-the-board wage increase and job protections for about 3,000 members over the life of the contract.
The approval is a milestone victory for the UAW that has long tried, with little success, to organize foreign-owned auto makers in the South. UAW President Shawn Fain revived the union’s southern organizing drive after it secured record-making contracts with the Detroit Big Three automakers in 2023.
“Volkswagen workers have moved yet another mountain,” Fain said in a statement following the vote. “From having the courage to stand up and form their union, to having the backbone to authorize a strike and hold out for a contract that honors their worth, VW workers are leading the way for the entire labor movement and non-union autoworkers everywhere.”
Fain’s efforts to expand UAW’s geographic blueprint are an attempt for the union to regain momentum after years of decline. Membership has fallen from a peak of about 1.5 million in the 1970s to roughly 400,000 today.
The UAW hopes the win will revive its southern organizing drive, which stalled after workers rejected unionization at a Mercedes-Benz Group AG facility in Alabama in 2024. However, the union faces stark hurdles—including cultural opposition to organizing in the south and a cooling labor market—that are likely to complicate its ability to capitalize on the contract, labor observers told Bloomberg Law earlier this month.
The company looks forward to building a strong working relationship with the UAW going forward, said Michael Lowder, a Volkswagen Group of America spokesperson.
“This milestone reflects our shared commitment to competitive wages, strong benefits, and the long‑term success of our employees and operations,” Lowder said.
Workers will receive a $4,000 ratification bonus with a $2,550 annual bonus, according to the union.
(Adds Shawn Fain comments in the 4th paragraph and Michael Lowder comments in the 7th and 8th paragraphs. Adds details from UAW about bonus structure in final paragraph.)
To contact the reporter on this story:
To contact the editors responsible for this story: