UAW strike costing GM $200m a week

UAW in the US have extended their strike once more in the few hours following General Motors’ (GM) alert to investors about the unpredictability of the costs associated with the labor action.

The American automaker estimated that the work stoppage would cost the business about $200 million (£164 million) every week.

Executives refused to speculate on when the dispute over compensation and perks would finish.

In September, the United Auto Workers (UAW) union started going on strike against Ford, GM, and Stellantis.

Now over 45,000 workers are taking part in the walkout, which is the first time in the union’s history that all three companies are being targeted simultaneously.

With their most recent declaration, the UAW extended the work stoppage to a GM assembly plant in Texas, employing roughly 5,000 union members. The website produces well-known automobiles like the SUV Chevy Tahoe.

GM expressed its disappointment with the strike’s escalation, labeling it “unnecessary and irresponsible”.

“It is harming our team members who are sacrificing their livelihoods and having negative ripple effects on our dealers, suppliers, and the communities that rely on us,” the business stated.

“It is time for us to finish this process.”

GM executives had previously informed investors that the strike had already cost the company roughly $800 million. The union has been steadily growing the strike since its inception.

They stated that going forward, they anticipated the measure to cause weekly output losses of roughly $200 million. General Motors has withdrawn its annual profit projections because of its inability to estimate the timing of the end of the standoff.

The automaker stated that in an attempt to mediate the conflict, which is currently in its sixth week, it had extended an offer of a “record” labor deal.

As disclosed by the corporation last week, the agreement involves a 23% salary increase, the return of inflation-linked pay adjustments, and other benefits.

According to GM, the proposal would result in an average worker’s compensation of approximately $84,000 at the conclusion of the four-year contract.

The union has criticized GM CEO Mary Barra for taking home a salary deal of over $28 million last year, but Barra acknowledged that investors were “concerned about the impact of higher labor costs”.

Let me deal with this directly. Since Covid, it has been evident that rising inflation and other causes will need wage and benefit increases throughout the US economy, the speaker stated.

The current GM approach, according to Ms. Barra, “rewards our team members but does not put our company and their jobs at risk”.

More than 140,000 employees of GM, Ford, and Stellantis are represented by the UAW.

UAW President Shawn Fain provided an update to union members last week, stating that while negotiations were moving along, he thought there was still “more to be won”.

“We have cards left to play and they have money left to spend,” he said, urging the workers to be firm during the negotiations.

The strike’s expenses had an adverse effect on GM’s earnings, which decreased by around 7% to $3.1 billion from July to September of last year.

The sales increased by more than 5% to $44.1 billion from the previous year, but the decline was not as severe as analysts had predicted.

GM stated that it was trying to save $2 billion in expenses.

It announced that it was delaying the inauguration of some of its plants, partly due to lower-than-expected sales of electric vehicles. It stated that by 2025, it still hoped to produce one million electrified vehicles in the US.

Credits: BBC

Read more at News Intercept:

UAW targets 38 facilities at GM and Stellantis, skips Ford

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