As GM announces quarterly results, all eyes are on strike’s effects
As GM announces quarterly results, all eyes are on strike’s effects
General Motors reports quarterly results on Tuesday, as the United Auto Worker strike continues into its sixth week. Ford will also offer an update on its finances on Thursday, and investors will be scrutinizing the numbers for clues about how the extended work stoppage is affecting the companies.
Only two weeks of the strike were in the third quarter, noted analyst David Whiston at Morningstar.
“So, because of that, the [Q3] numbers may not be that bad,” he said.
It’s the forecast for the rest of the year that’s the issue, according to economist Ned Hill at the Ohio State University. “This really is like a game of I don’t know if it’s ‘Jenga’ or ‘Rubik’s Cube.'”
If it goes on long enough, the strike could eventually cut into sales, and it’s likely the resulting contract will raise labor costs.
The UAW is pushing for wage increases and they can use healthy profits as leverage, said Michelle Kaminski, a professor of labor relations at Michigan State.
“They’re saying, ‘We helped you earn this money and we believe we deserve a share of it,'” she said.
The union is also demanding new EV battery plants be unionized. Ford recently paused construction of one in Michigan and GM said it will delay production of an electric pick-up over uncertainty about the EV market.
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