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How The GM Strike Affects Car Owners, Workers, Dealers And GM

The GM strike is now in its second week, making for the longest nationwide UAW walkout since the ‘70s. Unsurprisingly, the strike has had wide-ranging effects, with impacts felt not only by General Motors, but also by car owners, workers, and dealers.

For example, with replacement part warehouses now shut down by picketing UAW members, dealers are running out of replacement parts to fix customer cars. This includes dealers in the Southeast region, which are no longer receiving parts from the parts depot in Charlotte, North Carolina, according to GM dealer owner Ed Williamson.

GM Flint Parts Processing prior to the strike

GM Spokesman Jim Cain addressed the issue, offering possible solutions like sourcing parts from management-staffed depots, other dealers, or directly from suppliers. “Obviously it’s a difficult situation, and we are working to find other sources of parts around the country,” Cain said.

Meanwhile, GM supplier companies are also feeling the effects, with thousands of employees furloughed without the strike benefits offered to other UAW members. Thousands of workers in Canada have also been furloughed.

Back here in the U.S., UAW members are offered  $250 in weekly strike pay, far below the estimated $1,200 weekly pay made on the job. Morningstar analyst David Whiston estimates the GM strike will cost the UAW around $31.5 million a week in strike pay and health care costs, with money pulled from the union’s $750 million strike fund.

At the dealer level, inventory remains high after GM stocked up on vehicles in anticipation of the strike, putting together a 77-day supply of vehicles at the end of August, more than the 61-day industry average. However, some dealers are starting to run low on certain models, such as the Cadillac XT5. That said, according to the executive analyst for Autotrader Michell Krebs, sales have slowed since August.

Then there’s the long list of restaurants and other businesses that serve workers at the factories, which are now closed down due to the GM strike.

As for General Motors itself, the automaker stands to lose millions of dollars, with some analysts predicting loses of upwards of $100 million a day. More than 30 U.S. factories across the U.S. are closed due to the GM strike.

Contract negotiations between the UAW and GM continue, with minimal reporting on progress, although previous reports indicate that talks have been slow-going in establishing a new labor contract.

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Source: Associated Press

Jonathan is an automotive journalist based out of Southern California. He loves anything and everything on four wheels.

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Comments

  1. The latest on the strike is that GM workers don’t really know what they want and the strike will continue until someone runs out of cash, the strikers or GM.

    Reply
  2. Disagree, the UAW wants: guaranteed employment, guaranteed colas n bonuses, and lower tiered employees elevated to a higher level. Everything they want is in addition to already the richest pay pkg in the US industry. These costs ALL would be permanent which increases GM’s costs of operations. It’s not a fluctuating number, it’s permanent fixed costs.

    GM simply cannot agree to any of this, none of it is acceptable for the long term health of the company. GM actually needs to cut costs and unfortunately that means moving more jobs out of the US. These employees are slitting their own wrists on this one, IMO.

    I think GM intends to break this cancer for good so it can operate like every other vehicle mfr in America (Ford & FCA need to follow suit)

    This is a global economy and in order to complete the chains need to go. Ultimately the death of the UAW will have a “good” effect on employment, wages, performance and mfg.

    Reply
  3. Today’s GM is not going to make the same mistake of agreeing to the union demands that contributed to their bankruptcy. No it was not the only reason but it did lock them into pay and benefits that could no longer be supported. Legacy cost of the contracts sealed their fate.

    The real victims here are the local business and suppliers. They are not going to make back their losses.

    If you want more money and pay get your degree or trade skill and get a better job. The economy as it is has great demand for skilled jobs that pay well.

    I had a co worker that was former GM worker. He complained to me that after his buy out they were only clearing $130,000 a year in the a Youngstown area. I had little sympathy.

    Reply
  4. Why is that Toyota doesn’t have any unionized plants, yet seem to make cars that not only hold their value better, but that people want without the need for rebates?

    If the UAW was proposing value-added skilled labour to the cars they build, it sure as hell isn’t showing in the market. What do they bring to the table that is supposed to make the products of their labour better than a non-unionized car?

    Reply

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