Hyundai to hike US hourly wages 25% by 2028 after UAW wins deal

The Hyundai Motor Co. logo is seen on the front grill of a Santa Fe sports utility vehicle (SUV) at the Hyundai Motor Manufacturing Alabama (HMMA) facility in Montgomery, Alabama, U.S., on Wednesday, July 19, 2017. Luke Sharrett/Bloomberg via Getty Images

Hyundai Motor said on Monday it will hike wages for non-union production workers at its Alabama factory by 25 per cent by 2028, weeks after the United Auto Workers (UAW) won new contracts with the Detroit Three automakers.

The Korean automaker joins Toyota Motor and Honda Motor in raising U.S. factory wages after the UAW won a new contract with General Motors, Ford Motor and Chrysler parent Stellantis, which will result wage in increases of 25 per cent through 2028. The Detroit Three wage hikes amount to 33 per cent when expected cost-of-living adjustments are factored in.

Hyundai said that with a new raise coming in January, the 4,000 hourly workers at its Alabama factory will have received a wage increase of 14 per cent over the last 12 months. Hyundai Motor Group also plans higher wages at its electric-vehicle factory in the U.S. state of Georgia, set to open in 2025.

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Hyundai said that wages are being raised so that the company can “remain competitive and… recruit and retain top talent.” Hyundai builds the Santa Fe, Tucson, Santa Cruz and Genesis GV70 vehicles in Montgomery, Alabama.

On Friday, Honda said it would give U.S. production workers an 11 per cent pay hike starting in January and cut the time for factory workers to reach the top wage tier to three years from six, in line with a key concession won by UAW in its recent negotiations.

Honda and other non-union automakers in the U.S. have come under pressure to improve pay and benefits following the record contracts achieved by the UAW in late October, roughly six weeks after thousands of its members went on strike.

When U.S. President Joe Biden visited Illinois last week, he said he backed the UAW’s efforts to unionize Tesla and Toyota, adding that all U.S. auto workers deserve a deal similar to the UAW’s recent agreements with the Detroit Three.

Honda’s pay hike was announced after Toyota said it was raising the wages of its nonunion U.S. factory workers.

UAW workers are now in the process of voting on ratification of those contracts.

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