UAW Workers Get 20% Pay Hike at VW Chattanooga Plant

It’s taken two years, but workers at the Volkswagen plant in Chattanooga, Tennessee are set to get a big payoff after voting to approve union representation. The question is whether they will approve their tentative new contract, reports Headlight.News.

In a historic move, workers at the Volkswagen plant in Chattanooga, Tennessee in 2024 voted to accept representation by the United Auto Workers Union. Now they’re being asked to vote again.

This time they’ll have a chance to approve the first contract settlement reached between the UAW and the German automaker. If workers give the agreement a thumbs-up they will receive a 20% wage hike, significant new bonuses and improve health care.

“This is a historic moment, not only for these members but our union as a whole and the entire working class,” UAW President Shawn Fain said during a live town hall on Facebook.

What workers get

As is the UAW norm, full details of the tentative agreement weren’t immediately released, the union expecting to announce more when it also sets a day for the ratification vote. But it did note that the settlement “reflects significant improvements over the company’s last proposal.”

Among other things, the union appears to have gained language ensuring the plant will continue to have enough product to keep its hourly employees busy. That had become a concern last year when VW pared back production of the ID.4 battery-electric vehicle due to weak sales. There is language in the agreement, it said, to protect workers in other circumstances, such as a plant closure.

On a cash front, general wages would rise 20% if the contract is approved, or about $10 an hour. There’s a $6,550 signing bonus, meanwhile, and UAW-represented workers will get annual bonuses of $2,550, as well.

A boost for both workers and the union

The win at VW in 2024 marked a significant milestone for the UAW which, at the time, didn’t represent a single foreign-owned “transplant” assembly line despite the dozens that have opened since the mid-1980s.

The union launched a major organizing drive following settlements with Detroit’s Big 3 automakers delivering major improvements in wages, benefits and job protection. Volkswagen was the first plant where that drive led to a representation vote and workers overwhelmingly approved the UAW despite pushback from the company and strong opposition by Tennessee lawmakers.

The union hoped that would give it momentum to move on to the other transplants, most of which have settled into the South where support for organized labor has been tepid, at best. That proved to be the case when it came to the next representation vote, workers at the Mercedes-Benz plant in Tuscaloosa, Alabama rejecting the UAW in a lopsided vote. Since then, the UAW has failed to line up elections at any other foreign-owned plant.

More Auto News

• More on UAW Win at VW Chattanooga
• GM Profit Sharing Checks Cut as Automaker Profits Fall
• UAW Hoped to Build on VW Vote Momentum at Mercedes Plant

Chattanooga

VW’s Chattanooga plant opened in May 2011 producing the Passat. It was the first time the automaker built vehicles in the U.S. in 23 years, having closed its original plant in Westmoreland, Pennsylvania, in part, due to strained relations with the UAW.

The relationship in Tennessee has been a bit more cordial since the 2024 election, though they threatened to fray considering the unusually long negotiations process which began in September 2024.

Following announcement of a settlement, VW said “All these benefits recognize and reward the hard work and dedication our team members give every day.” It declined to comment on the upcoming vote,

VW said it would not comment further on the deal, noted trade publication Automotive News. “out of respect for the process.”