Auto workers worry it takes less labor to build electric cars. Maybe not, some researchers say

By Peter Valdes-Dapena, CNN Business

(CNN) — A traditional car engine is a complex wonder of engineering, with pistons moving up and down, springs compressing and decompressing, spinning shafts, opening and closing valves and spinning gears meshing together. That’s not to mention a transmission, connecting the engine to the wheels, that’s a complex machine all its own. An electric motor, on the other hand, is really just some magnets wrapped in wires and it only needs a single speed transmission. That simplicity worries the United Auto Workers union.

A commonly repeated estimate is that, with fewer parts under the hood, EVs require 30% to 40% less labor than gasoline cars. It’s not that simple, though, and some researchers argue that the labor savings of electric vehicles have been greatly overstated.

People assume those estimates are true, said researcher Turner Cotterman, because they’re based largely on the number of moving parts in an EV. Since there are fewer parts in electric cars than in gas-powered ones, people figure that they’re less work to manufacture, said Cotterman, who worked on a Carnegie Mellon University report into the issue and is now an associate with McKinsey and Company.

“There was an assumption that there is a linear relationship between the number of parts and the labor to make them,” said Cotterman.

But making the powertrain of electric vehicles – the batteries, electric motors and power management systems – requires more total labor, not less, than that involved in making engines and transmissions, said Erica Fuchs, a labor researcher at Carnegie Mellon. She worked on the research paper with Cotterman that analyzed the labor requirements of electric versus gasoline powertrains.

Researchers at the Boston Consulting Group reached a similar conclusion. They found that manufacturing a complete electric vehicle – beyond just the powertrain – requires, in total, only slightly less labor than making a gasoline-powered car.

“When you look, like for like, at the vehicle today – an electric vehicle versus [internal combustion] – there is on the order of a percent or a couple percent difference, in the labor hours required to manufacture that vehicle,” said Nathan Niese, global topic leader for electric vehicles at Boston Consulting.

These were among several research reports that found little total difference in the labor hour requirements of EV manufacturing compared to gas-powered cars. GM executive vice president for manufacturing Gerald Johnson made a similar claim in a GM video posted to a company website concerning the labor negotiations.

“We’ve done our own analysis at General Motors, and there are other studies that have affirmed that the employee base needed in the future for EV production is very similar to what’s needed for a comparable [internal combustion] vehicle today,” he said.

Battery-powered

In EVs there is one big part, in particular, that requires considerable labor, the battery pack. The battery cells that go into a battery pack require more than half of the labor hours involved in making the powertrain of an electric vehicle, said Fuchs.

Boston Consulting estimates that making battery cells takes up about 8% of the total labor to produce an entire automobile. That’s slightly higher than the percentage of labor needed to produce a gasoline engine, he said.

The jobs needed to build EV batteries are one reason the Inflation Reduction Act, which sets rules around federal tax incentives for electric vehicles, offers consumers more credits if they purchase an EV with batteries made in the United States. And a number of automakers, both US-based as well as European and Asian manufacturers, including Toyota, BMW and Hyundai, have announced battery-manufacturing projects in the US.

The battery manufacturing process is highly automated, as is a lot of modern manufacturing, but that still leaves a lot of work for people, said Niese.

“Yes, a lot of the equipment is automated in several of the steps, but in terms of managing that automated equipment, quality checks, maintenance, on-site product engineering, supply chain, those aspects still exist,” he said. “You’ve got to load the front end with all your raw materials, then it runs through a process.”

Ford had said that its battery plant in Marshall, Michigan, on which the automaker recently paused construction work, would employ 2,500 people. Ford also expects to train 5,000 people to work at a joint-venture battery manufacturing facility currently under construction in Kentucky. GM employs about 1,300 at its joint-venture Ultium Cells plant in Ohio, where workers voted to join the UAW.

On Friday, UAW president Shawn Fain announced that, although contract negotiations are still on-going, GM had agreed to put its battery cell manufacturing plants under whatever broader UAW contract is ultimately agreed to.

“They agreed to put the future of this industry under our national agreement,” Fain said in an online address.

GM did not comment on this aspect of negotiations.

Building the rest of an EV

When it comes to the car itself, there are many parts to an EV that people tend to overlook. There are high voltage wiring systems, on-board chargers that convert alternating current power to direct current to charge the batteries. In many EVs, complex cooling systems are needed to maintain battery temperature. Many EVs also have a front trunk, or frunk, that’s used as functional space, requiring additional construction.

Also, because electric cars have heavy battery packs, the rest of the vehicle needs to be especially light. That means workers need to contend with materials like aluminum and composites. These can be more difficult to work with than the steel the industry has traditionally used, Boston Consulting’s report notes. And these features also require more careful quality management.

In fact, setting aside the labor to build the powertrain, Boston Consulting estimates the final assembly stage of building – the part where components are brought together to make a final vehicle – actually takes somewhat more work for an electric vehicle than a gasoline-powered car. (The overall slight reduction in total labor found by Boston Consulting comes down to the lower number of parts, many of which are made by supplier companies.)

Niese cautions, however, that electric-vehicle production is still relatively new, so automakers will find ways to be more efficient and cut out work. They’ve had over 100 years to squeeze as much work as possible from gas-powered vehicles.

It’s still only the beginning with EVs.

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