Stock Market

UAW expands strike to 38 GM and Stellantis auto-parts distribution centers in 20 states

The United Auto Workers expanded its strike to 38 General Motors Co. and Stellantis NV auto-parts distribution centers in 20 states, hobbling the two carmakers’ repair networks.

UAW President Shawn Fain said that the union has made “some real progress” in negotiations with Ford Motor Co.
which agreed to cost-of-living increases, some job protections and other concessions, and it won’t be striking at additional Ford plants.

“Ford is showing us they are serious about reaching a deal,” Fain said.

Ford shares added to gains after the news, snapping a two-day losing streak, and were poised to notch their highest one-day percentage increase since June 7.

Nearly 13,000 UAW members have been on strike since last Friday at a Missouri GM plant making GMC Canyons and Colorados, an Ohio Stellantis plant making Jeep Wranglers and Gladiators, and portions of a Michigan Ford plant making Broncos and Rangers.

Joining them are 3,475 workers at 18 GM fulfillment centers and 2,150 workers at 20 Stellantis centers across the U.S. The workers at the auto-parts distribution centers started to walk off at noon Eastern on Friday.

GM said that the strike’s “escalation” was “unnecessary.”

“We have contingency plans for various scenarios and are prepared to do what is best for our business, our customers, and our dealers,” the company said in a statement. “We will continue to bargain in good faith with the union to reach an agreement as quickly as possible.”

Don’t miss: Tesla may be the winner of the Big Three labor woes

Progress with Ford negotiations is “encouraging,” suggesting that the Big Three could “perhaps reach a labor agreement sooner than some have been expecting,” measured in days and weeks and not months, Citi analyst Itay Michaeli said in a note Friday.

The new strikes at auto-parts distribution facilities would likely immediately impact “a relatively smaller yet high-margin revenue stream” for GM, Michaeli said.

A potential parts shortage could add pressure on the carmakers to reach an agreement sooner, he said. Compared with the possibility of strike at full-size truck plants, at the heart of the automakers’ profits, however, “today’s update seems somewhat more encouraging.”

Wedbush analyst Dan Ives called the UAW action “an aggressive move that essentially goes at the hearts and lungs of auto operations for GM and Stellantis.”

A settlement with Ford is likely over the coming week, Ives said. “The UAW and GM/Stellantis now have crossed the invisible line and the UAW strike is about to get a lot nastier.”

Since the strike began, the union and the automakers have said they are engaging in constant talks as they try to reach a compromise on a new national contract.

The union is demanding wage increases, an end to tiers, the restoration of pensions and cost-of-living adjustments and other concessions. Although both the union and companies have claimed progress during talks, GM President Mark Reuss said in a recent opinion piece in the Detroit Free Press that the UAW’s demands are “untenable.” That’s in line with Ford President Jim Farley’s characterization of the union’s wage proposal as “unsustainable” for the company before the strike deadline.

Fain mentioned Reuss’s “untenable” comment in his update Friday via webcast. GM and Stellantis “are going to need some serious pushing” to meet union demands, he said.

See: 5 things to know about the UAW strike


Checkout latest world news below links :
World News || Latest News || U.S. News

Source link

Back to top button