Tesla Strike Is a Culture Clash: Swedish Labor vs. American Management

 

Tesla Strike Is a Culture Clash: Swedish Labor vs. American Management

 

Workers seeking a collective agreement from the automaker say they are pushing for their rights, but car owners see them as taking the fight too far.

 

Melissa Eddy

By Melissa Eddy

Melissa Eddy spent several days in Stockholm and Malmo, Sweden, interviewing striking workers, Tesla owners and union leaders.

Dec. 27, 2023, 12:00 a.m. ET

https://www.nytimes.com/2023/12/27/business/tesla-sweden-strike-labor.html

 

The Tesla technicians who walked off their jobs in Sweden say they still support the mission of the American company and its headline-grabbing chief executive. But they also want Tesla to accept the Swedish way of doing business.

 

They call it the Swedish Model, a way of life that has defined the country’s economy for decades. At its heart is cooperation between employers and employees to ensure that both sides benefit from a company’s profit.

 

Instead, four technicians who walked off their jobs on Oct. 27 said, they have been subjected to what they described as a “typical U.S. model”: six-day workweeks, unavoidable overtime and an unclear evaluation system for promotion.

 

“Just work, work, work,” said Janis Kuzma, one of the technicians on strike.

 

The union representing the Tesla workers, IF Metall, won’t say how many of the company’s 130 technicians have walked out — it may be only a few dozen. The company’s 10 service centers remain open.

 

But as the strike moves into its third month, it is having an outsize impact on the Nordic region. At least 15 other unions have taken action to try to force Tesla to negotiate a collective bargaining agreement to set wages and benefits that reflect industrywide norms in Sweden. Daniel Ives, an analyst at Wedbush Securities, warned that the dispute was becoming “an important lightning-rod issue around unions globally” for Tesla and its chief executive, Elon Musk.

 

Polls show a majority of Swedes support the strike, widely viewed as a defense of the country’s consensus-based way of doing business. Nine in 10 people in Sweden work under a labor agreement, and strikes are relatively rare. But as the walkout continues, questions are being raised about whether Sweden’s reliance on labor-management agreements denies businesses flexibility and agility.

 

That divide can be seen in the reactions of some of the country’s roughly 50,000 Tesla owners, who see the walkout as a power play by a wealthy, politically influential union.

 

Mr. Musk has pushed back against efforts by his 127,000 employees around the world to unionize.

 

The company has declined repeated requests for comment. At a service center in Malmo this month, workers wearing Tesla shirts were busy moving cars in and out. Strikers on the picket line said some of those working appeared to be recent hires.

 

There is talk that some Tesla owners have been unable to find anyone to change their tires for winter — essential for driving in Sweden this time of year.

 

But fearing that the walkout has been little more than a nuisance for Tesla, IF Metall has called for support from other unions.

 

Unions in Denmark, Norway and Finland, as well as Sweden, have rallied around IF Metall. This means dockworkers have stopped unloading Teslas arriving by ship; union members at independent repair shops have stopped servicing Teslas; postal workers have quit delivering Tesla’s mail, including license plates; and electricians have pledged to no longer repair Tesla’s charging stations.

 

It may be too early to tell how much these measures are hurting the company. So far, registration numbers for new vehicles do not show the strike is denting sales — Tesla’s Model Y is poised to become the most popular vehicle in Sweden for 2023, with more than 14,000 cars sold through October, according to official statistics.

 

The company also appears to have found a loophole to get around a postal workers’ blockade by ordering license plates to be mailed directly to customers.

 

Still, some prospective buyers are concerned that despite Tesla’s pledge of business as usual, they will not get their cars in the five to eight weeks promised.

 

“I don’t want to commit yet,” said John Khademi, a Tesla owner who decided to put off ordering a new one. “I will wait to see how it plays out.”

 

The solidarity strikes have proved divisive. Some firms with no direct stake in the walkout, like independent auto repair shops, have lost business because they have collective agreements with IF Metall that require them to turn away business related to Tesla. Under Swedish law, if a union calls a solidarity strike, its members have to go along with it.

 

“Then those companies lose a lot of money and they are really frustrated,” said Mattias Dahl, the deputy vice president of the Confederation of Swedish Enterprise, which represents 60,000 companies.

 

Some believe these solidarity actions have gone too far. “There is no longer equality here,” said PM Nilsson, chief executive of Timbro, a Swedish think tank that promotes libertarian ideals and the free market.

 

He pointed to Spotify, the streaming audio giant founded in Stockholm in 2006, as another company that has operated in Sweden without a collective agreement. Like Tesla, it comes from a start-up culture.

 

“Companies in the Swedish labor market should be allowed to exist without a collective agreement,” Mr. Nilsson said.

 

Neither side has indicated it is willing to back down. IF Metall, which represents workers in other heavy industries, has built up its war chest over decades. It is offering those on strike 130 percent of their pay.

 

Tesla also has deep pockets — the company is valued at about $817 billion — and it says it offers wages and benefits that are equivalent to or better than those in a collective agreement, including the offer of stock options as a lucrative incentive.

 

Tesla demonstrated its willingness to fight by suing both the Swedish agency responsible for automobile registrations and the postal company after its license plates were held up. The lawsuits, filed in November, are continuing.

 

Collective bargaining, not the law, governs workplace conditions in Sweden. The country has no statutory minimum wage.

 

Strikes are uncommon because once a labor agreement comes into force, the union cannot call one. This peace guarantee has helped to keep the number of strike days in Sweden to one of the lowest levels in Europe — a little more than two working days a year lost to strikes and lockouts per 1,000 employees from 2010 to 2019, compared with 55 in Norway and 128 in France, according to one study.

 

Marie Nilsson has been a member of IF Metall for more than 40 years and took over as its leader in 2017. She remembers joining the picket line in 1995 to support workers who went on strike against Toys “R” Us, the last major U.S. company that rejected a collective agreement. But the action against Tesla is the first time she has called a strike.

 

Marie Nilsson, the head of IF Metall, has been in the union for more than 40 years and remembers joining the picket line in 1995 to support workers who went on strike against Toys “R” Us.Credit...Felix Odell for The New York Times

 

“It’s the workers who form the union,” she said. “It’s not someone from the outside.”

 

She pushed back against Tesla’s argument that it provides terms that are equal to or better than what employees would get under a collective agreement. “This is never the case,” Ms. Nilsson said.

 

Four technicians who described their reasons for striking said they admired Mr. Musk. One raved about how the extended battery in the new Cybertruck will be a game changer, and Mr. Kuzma drives a Model Y. But each agreed that for all Mr. Musk’s genius in revolutionizing electric vehicles, he was picking a fight with a country that prizes consensus, and that it would be wrong to conflate the Swedish Model with the United Automobile Workers, the U.S. union that took a hard line against Detroit’s Big Three automakers in a recent strike.

 

“IF Metall is not the U.A.W.,” said one technician, who declined to give his name because he said he hoped to return to his job at Tesla after the strike and feared repercussions for speaking out. “You have to know how different unions work in different countries.”

 

The strike is regularly covered in the Swedish media and has featured in television debates. Discussions have become polarized, pitting Tesla fans and owners against the union and its members.

 

Some Tesla owners describe the strike as a publicity grab and a demonstration of the union’s overreach. They point to the dozens of technicians who remain on the job, including some who have not joined the union, as a sign they are happy with their jobs.

 

“If the working conditions are so bad, they would have all quit,” said Ulf Siklosi, who drives a Tesla Model S. “Or they would all join the union.”

 

Daniel Schlaug, a fellow Model S owner and an investor in Tesla, said the company had sent out letters telling owners that 90 percent of Tesla employees were still working, a figure that could not be confirmed.

 

Mr. Kuzma and several colleagues said they were frustrated by the criticism from Tesla owners. “They don’t understand it’s about them,” he said. “If the pressure on the workers is too much, they are not going to do a good job fixing their cars.”

 

Last week, institutional investors from Sweden’s Nordic neighbors — who together manage $1 trillion in assets — sent a letter to Tesla’s board saying they were “deeply concerned” about Tesla’s attitude toward worker rights in Sweden and asking for a meeting early next year.

 

Ms. Nilsson would also like to speak to Mr. Musk. Asked what she would say if he called her, she responded: “I would love it.”

 

“I would say, ‘Let me explain, and let me hear about your expectations,’” she said. “Let us talk about it.”

 

Christina Anderson contributed reporting.

 

Melissa Eddy is based in Berlin and reports on Germany’s politics, businesses and its economy. More about Melissa Eddy