UAW Strike Could Cost GM Up To $100M Per Day, Financial Experts Say1
The ongoing United Auto Workers/General Motors strike could cost the automaker up to $100 million per day, a Citigroup representative told the Wall Street Journal.
Financial experts are split on the matter, however, with Credit Suisse estimating GM will lose around $50 million a day in the labor row.
GM not only loses money over its idled plants, but could face competitive setbacks if the strike were to last weeks and have an impact on its inventories. GM is believed to have a 77 day supply of dealer stock, with more stock on storage lots around the country.
It’s not clear how long the strike is expected to last. USA Today says it spoke with people “close to the UAW,” who said they expected it to last two to four weeks. GM and the UAW are believed to be quite far from reaching a deal, though, with UAW spokesman Brian Rothenberg saying the two parties have agreed on 2% of the contract have “got 98% to go.”
Nearly 50,000 workers walked off the job starting Sunday at midnight after the UAW and GM failed to ratify a contract by the Saturday night deadline. The UAW claims GM waited until only two hours before the deadline to give it a complete proposal, leaving it little time to negotiate the details before midnight.
The situation seemed to be developing Tuesday when Politico published a report indicating the Trump administration had decided to step in and help mediate the negotiations. GM and the White House later denied the claims in the report, though the publication said it remained confident in its reporting.
“This story is false,” GM said of the White House mediation claims. “The Trump Administration, including Larry Kudlow and Peter Navarro, are not involved in the negotiations between the UAW and GM. As President Trump has said, we would like to see a fair and speedy conclusion to these talks.”
In a tweet sent out Sunday, Trump expressed disappointment in GM and the UAW urged the two to reach a deal.
Here we go again with General Motors and the United Auto Workers. Get together and make a deal!
— Donald J. Trump (@realDonaldTrump) September 15, 2019
Contract negotiations between GM and the UAW are ongoing.
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$50M a day? No problem they’ll just make it up on the profit from the trucks and SUVs.