If you remember the auto workers strike at the big 3 – Ford, GM and Chrysler, many analysts were looking at Tesla and saying the gap between the big 3 and Tesla would widen and Tesla would have a competitive advantage in its electric vehicles. Part of the basis of the analysis was that Tesla is non unionized, but has competitive salaries. In every industry there will be unionized and non unionized workers, that does not mean that one is better than the other, it just means the owners or senior management has to deal with one or the other. Many years ago, my personal experience was working in a unionized environment and the wages were on the low end or very close to minimum. There are companies that do not want unions and others that tolerate or work with them.

In an article from the New York Times News Service, in Sweden, Tesla has about 120 mechanics working in the shops, however 90% of Sweden is unionized or covered by a collective agreement. The workers for Tesla went on strike which disrupts service to the owners of Tesla vehicles. Int addition, unionized dock workers said they would either stop or delay unloading shiploads of Tesla’s to support the mechanics. Other unions have called upon Telsa to bargain with the mechanics union.

Sweden has the world’s 3rd highest share of electric vehicle sales after Norway and Iceland, according to the World Resources Institute. Tesla’s vehicles are manufactured in Germany and the Model Y has been the top selling EV in Sweden this year.

Elon Musk has for years resisted efforts to unionize and in 2018 threatened to fire workers who wanted to unionize which is against US labor laws or Tesla was fined.

Linking to dividend paying stocks, there are advantages and disadvantages for companies to work with unionized workforces, although every company says they like the flexibility they have without unions. However, if you examine many companies, they will have settled lawsuits for unfair labor practices (is that a cost of doing business?). When companies are profitable and have very good margins, they are much more likely to work with whatever labor force they have or inherited. When companies want to cut costs, labor costs are high on the list and that is when unions tend to be needed by both sides who are open to changes in the processes of work. There are always better methods to be productive in both labor and management, hopefully the companies you own investments work with management and labor well.

There are more questions than answers, till the next time – to raising questions.