The United Auto Workers’ strike against the Big Three U.S. carmakers has given rise to a lot of talk about the future of the auto industry, and the fate of autoworkers in a world of electric vehicles. Republican politicians have tried to pin the autoworkers’ grievances on the Biden administration’s proposal for an electric-vehicle mandate (a proposal yet to be adopted). Ford, GM, and Stellantis (which owns Chrysler), meanwhile, have warned that the UAW’s demands could jeopardize their future EV investments.

The reality, though, is that this strike is not about the future. In an important sense, it’s a battle over the past. The UAW is looking, in effect, to win back the concessions it made in the late 2000s, which fundamentally transformed work at the Big Three, even as the companies insist that they cannot afford to return to the way things were.

The UAW’s first round of concessions came during contract negotiations in 2007, when the Big Three were losing billions of dollars a year, and watching competitors gobble up market share. The union agreed to let the companies establish a two-tier wage system, which meant that starting pay for workers hired after 2007 would be significantly lower than it had been for current employees. New workers would also have less generous health benefits, and would not get defined-benefit pensions or health care as retirees.

[Read: The real issue in the UAW strike]

Two years later, the financial crisis and recession of 2008–09 nearly put the Big Three out of business altogether (and did force GM and Chrysler into bankruptcy), while high unemployment reduced whatever leverage the union had. So, as part of the government bailout of GM and Chrysler, the UAW agreed to further concessions designed to narrow the labor-cost gap between the Big Three and their international competitors (whose plants in the U.S. are all nonunion). The union also agreed not to strike for the next six years. Older workers were offered buyouts, enabling the companies to bring in younger (and cheaper) workers. And automatic cost-of-living wage increases were suspended.

Over the 14 years that followed, the UAW won small wage increases in contract negotiations, and smoothed the path for workers hired after 2007 to reach top-tier status. Even so, the premier wage today—about $32 an hour—is worth considerably less, in real terms, than it was in 2003, while new workers begin at roughly $17 an hour (which is about the starting wage at my local Target). And, largely because older workers make up a declining share of the overall workforce at the Big Three, autoworkers’ average real hourly earnings have fallen almost 20 percent since 2008, according to the left-leaning Economic Policy Institute.

The UAW wants to change all that. It’s looking for a 40 percent across-the-board pay increase over the next four years, a restoration of cost-of-living increases, and enhanced pensions and retiree health care for all autoworkers. And the union’s not stopping there: It’s also demanding that autoworkers get a 32-hour workweek (while still being paid for 40 hours). The UAW is asking, in other words, for something like a return to the pre-financial-crisis bargain, plus a little more.

[Steven Greenhouse: Biden’s labor-climate dilemma]

The UAW’s president, Shawn Fain, has acknowledged that these demands are “ambitious.” But tight labor markets have given unions more leverage than in the past—as evidenced by the Teamsters recently winning a 48 percent pay increase over five years for part-time workers at UPS, and the American Airlines pilots’ union gaining a more than 46 percent pay increase over four years for its members. And the UAW’s strategy for the strike—which has so far involved walkouts at only three factories, with the threat of escalating the action to other plants if no deal is reached—has so far minimized the economic costs of the dispute for its members.  

Still, few observers expect the union to get the automakers to return to anything like the old status quo, particularly when it comes to pensions and retiree benefits. That’s because—despite a recent return to profitability—the past decade has been dismal not only for labor at the Big Three, but also for capital.

That may sound improbable. After all, Ford, Chrysler, and GM now have much lower labor costs, thanks to a combination of downsizing, their greater reliance on entry-level workers, and automation. The gap between the Big Three’s hourly-wage costs and those of their nonunion rivals, such as Toyota and Honda, has narrowed dramatically. (Estimates suggest that the discrepancy now stands at about $9 to $12 an hour, largely because of the cost of paying for retirees.) And the automakers have made hefty profits over the past decade: Ford posted a 34 percent increase since the last round of contract talks, in 2019; GM realized a 50 percent jump over the same period (comparable figures for Chrysler are hard to come by, because it’s a single company within the Stellantis conglomerate, which also includes Jeep and Dodge). The Big Three have also spent billions on share buybacks and dividends.

Those profits, though, have not translated into any real benefits for shareholders. Even with the buybacks, the annual return on GM’s shares since 2013, including dividends, has been just 1.9 percent, while Ford’s has been just 1.5 percent. (Stellantis stock has done better, though, again, Chrysler’s impact on that is hard to determine.) The S&P 500, by contrast, has risen by an average of more than 10 percent a year over that period, and just buying a 10-year government bond would have given you a better return than investing in Ford or GM stock.

[James Surowiecki: A strike scripted by Netflix]

Upper management at the Big Three has done very well over this period, as the UAW regularly points out. GM’s CEO got a salary package last year valued at nearly $29 million; Ford’s CEO got one worth almost $21 million. As the UAW’s Fain put it during a Facebook appearance in August, “While Big Three execs have used those extreme profits to pump up their pay, our members have fallen further and further behind.” This seems unlikely to be a convincing argument to shareholders who have seen their investments in GM and Ford go almost nowhere.

Stagnant stock prices are not the fault of workers; nor is it the UAW’s job to worry about shareholder interests. So the union is right to be using this moment when it has maximum leverage to try to get all it can. (That’s especially true given that no one knows what the transition to electric vehicles will mean for the UAW, whose master agreement with the Big Three does not cover their battery-cell factories.)

Arguably, the union has the easier message to sell to the public, though it will probably need more than that to move the automakers. A good compromise is one that leaves both sides unhappy, runs the maxim, but the trouble here is that both sides are already unhappy. That’s why finding a compromise could take longer, and inflict more economic pain, than anyone wants.

The Jeep Wrangler was built to drive out past where the power lines end. Watch any ad for the car, and you’ll surely see it surmounting boulders and conquering muck in places far from the beaten freeway. Electric-vehicle chargers may be scarce in the wilderness, but even a military-derived four-by-four must keep with the times. To the delight of Earth-loving off-roaders, Jeep has announced that the first all-electric Wrangler is in the works. The icons of combustion are going electric, if they haven’t already. Over the next few years, a battery-powered Chevy Silverado, GMC Sierra, and Ram 1500 will join the Ford F-150 Lightning as electric pickup trucks, adding to the several dozen other EVs that are now for sale in the United States. Even the Corvette, America’s paragon of V-8 bombast, will soon plug in to power up.

Things are very different from just a few years ago, when Tesla dominated EV sales. Now these zippy, battery-powered cars don’t seem quite as special. GM used a Super Bowl ad starring Lebron James to hype its new $100,000 Hummer EV; Elon Musk’s car company hasn’t released an entirely new model in three years. Publicly, at least, this stretch has been rough for Tesla: The company has been beset by production delays with its War Rig–like pickup truck, and its self-driving mode has been linked to hundreds of crashes, some fatal. Then there is Musk’s erratic behavior: According to a recent Bloomberg survey, the biggest reason Tesla Model 3 owners got rid of their car was “disapproval of Elon Musk.”

The legacy carmakers would be salivating if they didn’t have bigger problems. Nearly a week in, the strike launched by members of the United Auto Workers against Ford, GM, and Stellantis (the parent company of Chrysler, Dodge, and Jeep) does not seem to be close to a resolution. Just three plants—which collectively produce just one hybrid car and no fully electric ones—are currently affected by the stoppage, but the workers’ legitimate gripes are closely tied to electrification. It has become something of an existential crisis for companies built around the gas engine, a transition that’s more onerous than anyone in Detroit may have bargained for. Regardless of how this strike ends, the EV world is still Tesla’s until the car-buying public says otherwise.

The autoworkers’ demands are not a screed against the climate-saving potential of EVs. In fact, there is no explicit mention of electric vehicles at all. “We support a green economy,” UAW president Shawn Fain said this past weekend. “You know, we have to get behind this. We have to have a planet that we can live on.” Rather, the strike is mostly about bedrock union fare: Workers are asking for a 40 percent raise to match what the union says their CEOs have received over the past four years, as well as benefits such as more paid time off. (The car companies have countered by offering raises of roughly 20 percent.)

Yet beneath the surface of the strike lies a sinking feeling that the EV is not good news for autoworkers. They have good reason to be reluctant: The electrified age has redefined the task of building a car. Batteries are complex and difficult to manufacture, so the big carmakers source many of their EV batteries from plants run cooperatively with tech companies. GM and LG, for example, together operate or are building three battery factories nationwide. Once you have the battery in hand, assembling an electric car is a simpler task than building its gasoline counterpart, says Jeremy Michalek, an engineer at Carnegie Mellon University who runs its Vehicle Electrification Group. EVs still need to be welded together and painted, but they don’t need the spark plugs and engine cylinders and hoses and belts found under the hood of a typical vehicle.

Just how many jobs are at risk is hard to pin down, but “jobs at gasoline engine manufacturing plants will shift to jobs at electric motor and battery plants,” Michalek said in an email. To the consternation of unionized plant workers, most battery factories are not unionized, and the workers there make less, on average, than unionized autoworkers. In other words, EV production looks less like Henry Ford’s assembly line and more like the way the tech industry builds gadgets. That puts Detroit in a bind. The Big Three automakers don’t want to grant major wage hikes when they are already struggling to break even on electric cars. This year, Ford’s EV division will lose $4.5 billion, which from April to June meant about $32,000 for every EV it sold. (The company still plans to post $11 billion to $12 billion in profits this year due to sales of gas cars.) The sheer size of the losses points to how difficult it will be for the big firms to reinvent the way they’ve always done things.

Tesla, which only sells EVs, is already profitable, even as it has slashed vehicle prices multiple times this year. In the decade-plus since it launched the Model S, Tesla has cemented that advantage with a business model that Detroit still struggles to match. The company has defined the now-standard EV paradigm of cars that are seemingly little more than a battery, a few motors, and an enormous touchscreen controlled by sophisticated, walled-off software. The design points to Tesla’s Silicon Valley roots, as does its combustible figurehead and nonunionized employees. It relies on the tech industry’s signature obsession for efficiency, with Tesla’s giant new “gigacasting” machines able to stamp out bigger aluminum parts than was previously possible, lowering production costs for the Model Y by 40 percent, the company says. Crucially, the firm also pays less for labor: $45 an hour including wages and benefits, compared with $66 dollars an hour for the Detroit automakers, according to The Wall Street Journal.

In spite of its real struggles, Tesla remains surprisingly dominant. Earlier this year, its Model Y became the world’s best-selling car, only months after breaking into the top 10 in U.S. sales—both firsts for an EV. Even as everything turns electric, Tesla’s four core vehicles account for 60 percent of the EVs sold in America; Tesla sold 336,000 EVs in the first half of the year—nearly 10 times the sales of its nearest competitors, Hyundai-Kia and GM.

The company’s future looks bright too, and not only because the strike could stymie Detroit while Tesla forges ahead. (The union is threatening to expand the stoppage if no deal is reached by Friday.) Tesla also might be the car company best positioned to take advantage of President Joe Biden’s big climate bill. Before the Inflation Reduction Act, Tesla had maxed out on the tax credits it could offer to buyers. Now it can once again promise them a $7,500 price cut on most of its cars, a huge win as EVs remain more expensive than gas cars. And car companies qualify for the IRA tax credit only if they do much of their battery and vehicle manufacturing in North America—which includes the likes of Ford and GM but cuts off major Tesla competitors such as Hyundai and its popular Ioniq series.

Tesla is winning the charging war too. Until very recently, its sprawling Supercharger network served Teslas only, and its proprietary plug was locked in a VHS-versus-Betamax standoff against the standard used by everyone else. Last November, Musk rebranded his tech as the open North American Charging Standard, inviting his rivals to use his system. One by one, they did. The drivers of future Ford, Honda, Mercedes-Benz, GM, Rivian, Polestar, Nissan, and Volvo EVs that use Tesla’s plug will be able to charge at some Tesla-owned Superchargers—and send Musk their money.

No matter how the UAW strike ends, for now and probably for years to come, all electrified roads lead to Tesla. It faces unprecedented competition, but the legacy carmakers are stuck in neutral. No, its huge lead won’t last forever; the competitors still are catching up. And this is Elon Musk, after all. It’s always possible that he will pursue some unrelated grievance that threatens to distract him, like the several times his tweets about Tesla got him into legal trouble.

If Tesla drags the entire car industry toward the Silicon Valley business model, that may not be a cause for celebration. It could lead to streamlined EV production and cheaper electric cars, certainly a good thing for the automotive pivot away from fossil fuels. But efficiency comes at a cost. Tesla itself has been dogged by accusations of overworked employees suffering fainting spells and dizziness; workers have relayed stories about factories that resemble a “modern-day sweatshop.” (Tesla has repeatedly denied wrongdoing.) The tech industry prides itself on moving fast and breaking things—not the kind of culture that values the wages and job security that auto unions exist to protect. Big Tech has already devoured much of the American economy, and it seemingly dominates every corner of our lives. Now even the car industry can’t escape.