New York (CNN) — For five decades, the southern United States has been an attractive location for foreign automakers to open plants thanks to generous tax breaks and cheaper, non-union labor.
Now, the United Auto Workers has dealt a serious blow to that model: winning a landslide union victory after decades of failing to unionize automakers in the South.
The UAW easily won a historic victory Friday at Volkswagen’s plant in Chattanooga, Tennessee, with 73% of workers voting in favor of the union. It’s the UAW’s first win in trying to represent workers at a foreign car manufacturing plant in the South.
While a single win won’t alter the union landscape in the South overnight, labor experts say the Tennessee victory may be a turning point in the least unionized part of the United States. (South Carolina and North Carolina have the lowest union rates in the US; Louisiana is the sixth-lowest.)
For one, it may provide momentum for current union drives at foreign auto plants in the South and spill over into organizing efforts in other industries, said Stephen Silvia, a professor at American University and author of “The UAW’s Southern Gamble: Organizing Workers at Foreign-Owned Vehicle Plants.”
The UAW’s win at Volkswagen “itself will not realign the South. But it’s an important building block for southern realignment,” Silvia said, adding that the win “challenges the southern growth model.”
The UAW has announced an effort to organize workers at 13 carmakers, including foreign automakers such as Volkswagen, Mercedes, BMW, Honda, Hyundai, Mazda, Nissan, Subaru, Toyota and Volvo. The union is also aiming to organize three American EV makers – Tesla, Rivian and Lucid. Of those three, however, only Tesla has a plant in the South, in Texas.
The first test of the UAW’s momentum comes next month, when a union vote at a Mercedes plant in Vance, Alabama, is set to be completed. The plant has about 6,000 hourly workers.
But the South’s history of difficult structural dynamics for unions is entrenched. And union wins in the auto industry are likely to generate significant political backlash.
South Carolina Gov. Henry McMaster said earlier this year he would “fight” unions “to the gates of hell,” and Alabama Gov. Kay Ivey said “the Alabama model for economic success is under attack” by unions.
“Unions are an existential threat to the political economy of the South,” said Erica Smiley, the executive director of progressive advocacy group Jobs with Justice. Union members are more active politically, studies show, and likelier to push for pro-worker policies. This poses a challenge to the anti-union political and business consensus of the region.
Auto industry moves to the non-union South
Detroit and other industrial cities in the North dominated the auto industry for much of the 20th century, but the US auto industry has increasingly shifted to the South in recent decades.
Nissan opened a plant in Smyrna, Tennessee, in 1983, followed by BMW opening in Spartanburg, South Carolina, in 1994. Mercedes-Benz came to Vance, Alabama, in 1997. Honda moved to Lincoln, Alabama, in 2001. And Volkswagen, Toyota, Hyundai and Kia built factories the South in the 2000s.
Since 1990, the South’s share of auto jobs has doubled from around 15% to 30% today, according to S&P Global Market Intelligence. Meanwhile, the Midwest’s share has declined from 60% to 45%.
The transition to electric vehicles is poised to speed up this trend. Mostly nonunion EV jobs and manufacturing investments are surging in Southern states led by Republicans. The region has picked up 66% of planned EV jobs, according to a report by the Environmental Defense Fund.
Part of the reason foreign automakers have moved to the South is to escape unions. Before Friday’s win, the highest profile union election held in the South in recent years was the attempt to organize Amazon warehouse workers in Alabama in 2022. The union lost two separate votes there, although there is a hearing set for later this week about objections to that election that could order a third vote or certify the union’s loss.
Every state in the South has a “right to work” law, which allows workers to opt out of paying fees to a union at their workplace, even if they benefit from union bargaining agreements, undercutting a union’s financial resources to strategize and collectively bargain.
Southern political leaders have also used tax breaks and other subsidies to draw auto investments to states. These incentives have been predicated on companies keeping out unions.
“In the South, you’ve had the political and economic establishment that have built an economic model based on low wages and little worker voice,” Silvia said.
“When UAW has tried to organize, they’ve tried to fight against it.”
GOP leaders have stepped in to block unions and preserve this model.
Tennessee Gov. Bill Lee in 2019 visited Volkswagen’s plant in Chattanooga to encourage workers to reject the union, and former South Carolina Gov. Nikki Haley said in 2015 she was a “union buster” when recruiting automakers to the state.
Southern states such as Georgia have passed laws threatening to cut off subsidies to companies that voluntarily recognize unions.
Overcoming union opposition
A major deterrent to unionizing efforts in the South is the ties between unions and the Democratic party.
Rank-and-file workers who supported the UAW effort at the Volkswagen plant in Chattanooga told CNN that one problem they faced when trying to drum up union votes was their co-workers’ dislike of Biden — who supported the union in its auto strike last year and whom the union has endorsed.
But the Volkswagen win, said UAW President Shawn Fain to CNN, shows that politics are not an insurmountable obstacle when it comes to organizing in the South.
“Trump will win Tennessee by a pretty big margin, I would guess. You know what, we just won by 73% in Tennessee,” Fain said. “I’m not worried about the political aspect of this, because our campaign is about bringing justice to workers.”
In the wake of the UAW’s victory at Volkswagen, labor advocates expect to see other states pass measures to deter union efforts — but workers may be energized.
“I think we’re going to see a lot of efforts to revitalize labor in the South. The gains in Chattanooga won’t stay in Chattanooga,” said Harley Shaiken, a labor historian at the University of California, Berkeley.
Erica Smiley from Jobs with Justice said “unions must stop seeing the South as no man’s land” where they can’t win and invest in efforts to organize southern industries.