As GM-UAW Strike Enters Second Week, Both Sides Wait for the Other to Blink

Steph Willems
by Steph Willems

General Motors seems ready to wait out any resistance to its contract offer by UAW-represented workers, though a prolonged strike could still hurt the company. With the strike by GM workers in the United States now entering its second week, the automaker’s vehicle inventory is healthy enough to weather days and weeks of picketing, but the same cannot be of the personal finances of many striking workers.

At this point, no one’s predicting a quick resolution.

Bargaining teams from both sides may well be making progress behind closed doors, though the situation on the ground remains the same as last Monday.

CNBC reports that GM went into the strike with 77 days’ worth of vehicles in its inventory, well above average for the industry. That’s a fleetwide average, of course, and some models’ reserves aren’t quite as healthy. GM has a 57-day supply of the Chevrolet Tahoe, said Michelle Krebs, senior analyst at Cox Automotive.

In preparation for a possible strike, the automaker pinned the production accelerator to keep dealers satisfied and provide the company with breathing room during a work stoppage at its plants, CNBC reports. This also allows GM to hold the line at the bargaining table.

While some analysts questioned whether production of the C8 Corvette, due to hit driveways next year, could incur a delay as a result of the strike, GM Authority shot down this possibility. Basically, the strike would have to go really long before timelines get tinkered with at Bowling Green.

The first GM customers to feel the impact of the strike won’t be those looking to buy new cars, but those looking to repair existing ones. Dealers contacted by CNBC claim parts shortages could crop up as early as next week if GM and the UAW remain deadlocked. Then there’s the issue of deliveries of new supply to those dealerships. Over the weekend, the International Brotherhood of Teamsters, though its president, Jim Hoffa, said the union would not deliver GM products from factory lots to dealerships — an act of solidarity with the striking UAW members.

Failure to procure a new vehicle for a customer could easily see GM lose sales to its rivals.

On the finance side, both sides are well prepared, with Stephen Brown, senior director of U.S. corporates at Fitch Ratings, telling Automotive News that GM’s $34 billion in liquidity will “help them weather a prolonged stoppage if that’s what it amounts to be.” Even losing $50 to $100 million a day, GM won’t come under real pressure for some time. As for the UAW, its strike fund, valued at $700 million, is doling out $250 in strike pay to roughly 46,000 workers a week. That’s about $11.5 million a week.

Still, it’s hardly a lot to get by on if you’re one of the picketing workers, and it’s made all the more worse by GM’s elimination of health coverage for striking workers. Speaking to media, many workers, while remaining determined in their bid to achieve their goals, expressed worry about how a long-running strike might impact their families.

[Image: UAW]

Steph Willems
Steph Willems

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  • Akear Akear on Sep 23, 2019

    I am hearing now they are expecting the strike to go at least a 100 days.

  • Jkross22 Jkross22 on Sep 24, 2019

    Once GM imports more cars to the US than what they make domestically, will it be then that UAW members walk out and simply not come back? Most vehicles imported from China are made by American companies. If I was a plant worker and was seeing all of this, at what point do you just say "f this, I'm leaving and going to work for VW or Honda or Toyota in the US?" GM doesn't give a crap about you guys. They see you as expendable and easily replaceable by Chinese plants.

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