Tesla’s Labor Dispute Escalates; Nordic Policy Expert Hired Amid Collective Bargaining Standoff

By Moon Harper

Dec 21, 2023 12:26 AM EST

According to a job posting on its website, Tesla is looking to hire a Stockholm or Oslo-based Nordics public policy and business development manager as its ongoing disagreement with labor unions in the region continues without a resolution in sight. The manager will ensure that the political, regulatory, and fiscal frameworks in the Nordics support Tesla's mission.

Escalating Standoff

The company and members of the Swedish trade union IF Metall are in a standoff over Tesla's refusal to sign collective bargaining agreements. While the dispute started with 130 mechanics at 10 Tesla repair workshops in several Swedish cities, workers from various unions in Sweden and beyond have initiated solidarity strikes.

In recent weeks, Danish, Finnish, and Norwegian unions from various sectors have taken steps to push Tesla to provide collective bargaining rights to its Swedish staff. Additionally, several pension funds have sold their Tesla stock due to the company's refusal to negotiate with labor unions.

Last week, Sweden's Transport Workers' Union announced it would cease waste collection at Tesla's workshops in the country. This move followed similar actions by dockworkers, truck drivers, electricians, cleaners, and postal workers.

Labor Agreements since the 20th Century

In Sweden, labor relations follow agreements made in the 20th Century, and almost all pay is determined by collective agreements between companies and labor unions without government interference. Similar principles apply in other Nordic countries, where a significant portion of the population, crucial for Tesla's market, belongs to unions. The workers are not making specific pay or condition demands. Still, they are pushing the company to sign an agreement for doing business in Sweden and the surrounding region.

Tesla, Being an Anti-Union

Elon Musk, Tesla's CEO, is known for being anti-union and has criticized Swedish postal workers for obstructing the delivery of license plates to Tesla vehicles, calling it "insane." Tesla has not commented on this matter in response to a CNBC request. Strikes are expected in the coming days, and neither Musk nor the unions have signaled any intention to give in.

Sparking a Larger Movement

Dan Ives, managing director at Wedbush Securities, noted that the intense standoff at Tesla is becoming a significant concern in Sweden and the broader region. Ives emphasized that while the situation in Scandinavia is specific to Tesla, it holds more general importance as a union-related issue globally. He pointed out that following the recent UAW battle led by Shawn Fain in Detroit, where GM, Ford, and Stellantis gave in to union demands, the next potential battleground could be Tesla.

In November, the United Auto Workers (UAW) union initiated an unprecedented effort to organize 13 nonunion U.S. automakers, encompassing 150,000 workers, following successful contracts with Detroit car manufacturers. Analyst Dan Ives stated that it's unlikely for U.S. unions to target Musk and Tesla individually. However, he suggested that if Tesla yields to Scandinavian unions, it might spark a more significant movement reaching the UAW and the U.S. by 2024.

Tesla's Stance in Question

In a unique standoff, the world's wealthiest men, Elon Musk and Tesla face a challenge from Scandinavian organized labor principles. The outcome is uncertain, with experts suggesting two possibilities: Tesla yields or Scandinavian union solidarity weakens.

George Kochanowski, a global supply chain expert, anticipates Musk may eventually give in if energy costs rise in Europe, as reported by CNBC on Monday. However, questions arise about the ethical implications of selective strikes. Other global automakers are closely observing, but the limited scope of Tesla's products in Scandinavia might impact its bargaining power compared to more diversified conglomerates. The situation's implications on targeting a single company are significant, says Kochanowski, "because if the unions go take a lick of that lollipop and like it, they could think 'maybe I don't want to import this or that," potentially affecting import decisions based on union actions.