Having left Sweden on October 27, the social conflict between Tesla and the mechanics of its repair shops has spread to Denmark and Norway. The American electric car manufacturer still refuses to sign the collective agreement for its Swedish employees. Several powerful Nordic investment funds, shareholders of Tesla, have called Elon Musk to order.
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Elon Musk did not expect to suffer such a setback after refusing to sign the collective agreement which sets the minimum wage for 130 mechanics in his repair shops in Sweden. Six weeks after the start, on October 27, of a strike movement in around ten Tesla repair workshops in seven Swedish cities, the movement has taken on an international dimension. And the sale of the famous American electric car brand is blocked in Sweden.
“Tesla’s mistake is to have attacked the collective agreements which set minimum wages sector by sector in Sweden. A country where 70% of the population is unionized, compared to the 8% of French people who belong to a union (in the private sector)”, comments political scientist and Scandinavia specialist Yohann Aucante, researcher at EHESS Paris. These texts, which cover almost 90% of all employees in Sweden, form the basis of the Nordic labor market model.
Anxious to protect this social model, around fifteen Swedish unions followed the strike movement at the call of the powerful union IF Metall. Dockers have stopped unloading cars, transporters have stopped transporting vehicles, electricians have refused to repair electric charging stations, cleaning agents have stopped cleaning the brand’s showrooms, and garbage is piling up in front of them. Tesla centers since the garbage collectors refused to pick them up.
The Swedish Post Office even joined this solidarity strike, preventing the delivery of license plates, essential for putting the new Teslas into circulation. At the other end of the chain, dealerships stopped offering the brand to their customers and taxis in Stockholm suspended their Tesla purchases.
Elon Musk angry
This revolt aroused the ire of Elon Musk. “It’s insane” commented the billionaire on his social network X on November 23.
In response, Tesla filed a request to force the Swedish postal operator to deliver the license plates, and sought compensation for a loss of more than 87,000 euros. But his request for prosecution was rejected on December 7 by a Swedish court.
Far from stopping there, the “sympathy strike” extended to neighboring countries. With the marketing of its vehicles in Sweden blocked, Tesla had considered shipping its cars through Denmark and Norway. But dockworkers from these three countries have joined the movement.
After the largest Danish union, 3F, declared a solidarity strike with Swedish workers on December 5, the largest private sector union in Norway warned on December 6 that it would block the transit of Tesla cars to Sweden if the American manufacturer does not reach an agreement with its Swedish workers by December 20.
“There are also powerful collective agreements and unions in Norway, and particularly in Denmark, where most of the labor law is set by these texts. Therefore, Norwegians and Danes stick to this model where unions have a minimum negotiating power with employers”, explains Yohann Aucante.
This “sympathy strike” tool is rarely used, he explains. The last major mobilization dates back to 1995, when the toy company Toys’r’us tried to bypass the unions and impose its own wage rules. The American brand finally gave in, after three months of strikes in Sweden and Europe.
Tesla’s attitude deemed “very worrying” by its Nordic investors
Another threat, even more serious for Elon Musk, several powerful pension funds in the region, including the Norwegian KLP, have criticized Tesla, deeming its “attitude towards the right to collective bargaining” “very worrying”. In a letter they plan to send this week to the automaker’s management, they defend the region’s labor market model. “This model has enabled the Nordic countries to become one of the most prosperous and harmonious regions in the world,” said the letter seen by Reuters.
These pension funds, including Folksam in Sweden, as well as PFA and PensionDanmark in Denmark (holder of 255 million euros of Tesla shares at the end of June), plan to request a meeting with the manufacturer. “It’s not just about the working model in the Nordic countries, but also about basic human rights,” said Kiran Aziz, head of responsible investments at KLP, holders of around 195 million euros in Tesla shares.
The Norwegian sovereign wealth fund, Tesla’s seventh shareholder with a stake of around 6.3 billion euros, has so far not planned to sign the letter, but said last week it would continue to put pressure on the company to respect labor rights such as collective bargaining.
Hard blow for Tesla’s image
For Tesla the stakes are high. “As the Scandinavians are the first consumers of Tesla in Europe, the company has no interest in prolonging a conflict which will seriously damage its image,” notes Yohann Aucante, who believes that Tesla will have to pay the price. “With this trend towards greening economies, it is ‘bad style’ to produce your automobiles in China when you are building an electric car whose aim is to limit the carbon impact. This is why Tesla is trying to repatriate part of its production in Europe, but the labor cost is not the same and there are more rules here.”
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If the strike currently only concerns northern European countries, it could give ideas to the brand’s 11,000 employees in Berlin, where the Gigafactory, its first production site in Europe, is located. German employees there obtained a 4% salary increase at the beginning of November, the result of pressure from German unions.
But this concession from management could also be linked, according to the Washington Post, to the fear of contagion from the strike started in the Nordic countries. Tesla also fears that its workers in the United States will unionize more through a boomerang effect.
With AFP