DETROIT, MI – If the United Auto Workers (UAW) union fails to come to an agreement with Detroit automakers by the looming deadline of September 14, 2023, the resultant 10-day strike could have a financial impact upon UAW members – which includes Stellantis, Ford, General Motors and related businesses such as their franchised dealers – in the amount of up to $5 billion in losses, which would have a trickle-down effect upon practically every aspect of the automotive industry.
The previous most recent instance of UAW failing to come to an agreement with an automaker over a contract occurred in 2019. At that time, the union went on strike for 40 days, ultimately costing GM $3.6 billion. However, according to Michigan-based consultancy firm Anderson Economic Group (AEG), that particular strike did not have a tremendous impact on the overall retail automotive industry due to the large inventory of vehicles available at that time.
That would not be the case this time around if a strike were to occur in September, AEG vice president Tyler Theile noted, as the inventory of vehicles available on the market is currently at a much lower level than it was four years ago, giving the industry a much smaller safety net than during the last strike.
With current inventories hovering around only 55 days, the industry looks different than it did during the last UAW strike,” he said.
The reason for the greatly reduced inventory can be attributed to the COVID-19 pandemic, which caused global supply chain issues that translated to shortages of new cars being produced, and automakers are still struggling to get their output back up to pre-pandemic levels. Therefore, if UAW does indeed go on strike in September, it could result in a far more complicated – and costly – situation this time around, as inventory sold during that period of time would be unable to be quickly replenished due to workers being off the job and on the picket line.
Christopher Boyle is an investigative journalist, videographer, reporter and writer for SEARCHEN NETWORKS® as well as other independent news and media organizations in the United States. Christopher works on a wide variety of topics and fields, has been featured in print and online in a variety of publications, from local to national, and helps keep a keen-eye on what’s happening in the automotive world for Auto Buyers Market.