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Tesla (NASDAQ:TSLA) faces additional pressure from prominent Nordic investors such as Norway’s largest pension fund KLP, Sweden’s Folksam and Denmark’s PFA and PensionDanmark over the company’s approach to working with unions. The original standoff with a small number of repair shops in Sweden has now escalated to the point that well-known investors are taking notice.
The group of large Nordic institutional investors has reminded the electric vehicle maker in clear terms that the Swedish labor market model has enabled the Nordic region to thrive. Notably, the model has seen employers and unions agree to negotiate conditions and salaries without involving the governments. “We as Nordic investors acknowledge the decade old tradition of collective bargaining, and therefore urge Tesla to reconsider your current approach to unions,” stated one of the investor groups.
In Sweden, 15 unions have joined the strike at the request of the IF Metall union and transporters are refusing to deliver vehicles. Over the last week, more unions in other parts of Scandinavia are pledging not to unload or transport Tesla vehicles bound for customers in the Swedish market.
Wedbush Securities analyst Dan Ives warned that while the Scandinavian situation might look like a geographically-contained situation that Tesla (TSLA) is battling, it also could be an important lightning rod issue for unions globally as it plays out further.
“If Tesla gives into the unions around this ongoing dispute it could create a growing brush fire that eventually gets to the UAW and U.S. into 2024,” he noted. However, the alternative of playing hardball in Scandinavia also has risk to the Tesla (TSLA) brand and eventually European sales.