VW Chattanooga workers ratify first UAW contract 96-4

Workers at Volkswagen’s Chattanooga, Tennessee plant ratified their first collective bargaining agreement with the United Auto Workers (UAW) by 96% on 19 February, securing a compounded 21.6% wage increase over four years alongside major reductions to their healthcare costs. The contract takes effect on 23 February and runs through 2030, covering approximately 3,000 unionised employees and marking the conclusion of nearly two years of negotiations.

Production workers will see their top hourly rate rise by around US$7 to above US$39 by the end of the agreement, while skilled trades workers will reach approximately US$50. All members will receive a US$4,000 ratification bonus and US$2,550 annually for the life of the deal. Healthcare premiums will be cut by at least 20% and frozen for the contract period—a priority issue and sticking point during negotiations.

The agreement also includes job security provisions: 80% base pay during temporary layoffs, protections against the outsourcing of core UAW-represented work, and a commitment from Volkswagen to keep the plant open and maintain sufficient production volume for the duration of the contract.

“Today you showed the world Southern autoworkers are ready to fight,” UAW President Shawn Fain told workers in Chattanooga after the ratification result was announced. In a statement, Volkswagen Group of America spokesperson Michael Lowder said the deal “reflects our shared commitment to competitive wages, strong benefits, and the long-term success of our employees and operations”.

The outcome is a significant moment for the UAW’s broader southern strategy, although its ambitions in the region have largely stalled since the Chattanooga vote. A unionisation drive at Mercedes-Benz’s Alabama plant failed just a month after the Volkswagen win in 2024, and campaigns at other southern facilities have fizzled out. Fain has set a goal of adding 25,000 new members from foreign-owned southern plants by 2028, a target analysts have characterised as ambitious.

The political environment has also shifted substantially. The Trump administration has fired National Labor Relations Board officials and ended collective bargaining rights for more than a million federal workers. This stands in marked contrast to the climate during the Biden administration, wherein the former president made the historic step of joining UAW on the picket lines. 

The VW ratification also gives Fain a concrete win to point to as he faces internal leadership challenges and approaches his own reelection. Reports have swirled of discord within the union’s leadership ranks, as have allegations that Fain retaliated against the union’s treasurer following her refusal to approve expenditures for his inner circle. The next UAW leadership election will take place later this year.