Tesla crisis in Sweden

The IF Metall union, which went on strike at factories in Sweden after electric car giant Tesla, whose CEO is Elon Musk, refused to sign a collective agreement, said Tesla risks damaging the Swedish model, which has been the basis of decades of the country’s economic success.

Marie Nilsson, president of the IF Metall union behind the Tesla strike, told the Financial Times that the Swedish model, developed in the 1930s, is at the heart of the country’s prosperity, with employers and unions making joint decisions in the working market.

“If you look at this from a long-term perspective, it could be a threat to the Swedish model,” Nilsson said. “This is really important to us,” she said.

WHAT IS THE SWEDISH MODEL?

This system, developed between unions and employers in 1938 and in which labor market conditions, including wages, are determined by both parties, not the government, is called the “Swedish model.”

Both union and business leaders attribute the low level of strikes to this system and believe it is crucial to the success of Sweden, a country of 10 million people that is home to manufacturers such as Volvo, Atlas Copco and Northvolt.

‘THE BIGGEST DANGER IS THE EU DIRECTIVE’

The European Union agreed that the minimum wage should be at a level that provides an adequate standard of living in 2022, but decided that the directive would not be implemented in countries where more than 80 percent of the workforce is covered by collective agreements.

Since approximately 90 percent of employees in Sweden, one of the countries with the highest unionization rate in Europe, have a collective agreement, Sweden obtained an exception to the EU minimum wage directive.

Nilsson stated that one of the biggest threats to the Swedish model is the EU directive, which will impose a certain level of minimum wage instead of ensuring it is provided by an agreement between employers and unions, and said Tesla could damage the culture of the collective bargaining.

“If Tesla shows that it is possible to operate in Sweden without a collective agreement, other companies may want to do the same,” Nisson said. We have a successful model in Sweden. We try to explain this. “This type of conflict occurs very rarely.” saying.

Union leaders said they have enough funds to support striking workers, who currently receive about 130 percent of their salaries from unions, including vacation and pensions, for decades because the emergency fund used for payments is rarely tapped. uses. “We could continue the strike for a long, long time,” Nilsson said.

THE DISPUTE INCREASED, MUSK WON THE FIRST VICTORY

The conflict between Tesla and Swedish unions has escalated in recent days after 130 workers affiliated with IF Metall, one of the country’s largest unions, went on strike at 8 Tesla factories in Sweden on October 27.

The incident, which began with the strike of the IF Metall union, spread to postal workers, dockworkers and cleaners who took action against the car manufacturer.

Postal workers in Sweden announced Monday that they would support the union’s strike by not returning license plates produced for Tesla vehicles to their owners. Tesla CEO Musk called the postal workers’ actions “insane.”

The American automaker has filed two lawsuits against Sweden and its postal service, asking judges to allow it to buy license plates directly from the Swedish Transport Agency. Tesla achieved its first victory when the court ordered the Swedish Transport Agency to hand over the license plates to Tesla within 7 days.