Counting the costs of the UAW strike
With no respite in sight in the US autoworkers strike, GM and Ford say they will furlough another 500 workers due to the industrial action. We look at how much the strikes will cost the US car industry.
(Video summary)
GM and Ford's stocks plunge amid continued UAW strike
The ongoing strike by the United Auto Workers (UAW) is causing big problems for the car industry in the United States.
General Motors (GM) and Ford have recently announced that they will be temporarily laying off an additional 500 workers because of the strike. This means that these workers will not be able to work and earn money until the strike is resolved.
If we look at the stock market, we can see that GM's stock has been going down as the strike continues. On the other hand, Ford's stock has shown a slight increase, but it still follows a similar pattern to what it was in mid-July.
The UAW workers are refusing to go back to work until they reach an agreement with the car companies. Negotiations are ongoing, but no deal has been made yet. As a result, the longer the strike continues, the more money both Ford and GM are losing. JPMorgan estimates that Ford has already lost $145 million in operating profit during this past quarter, and GM's estimated loss is even higher at $191 million. It's clear that the strikes are causing major financial problems for both Ford and GM.
Resolution
If the strikes continue, the companies are expected to lose even more money. This is why it is crucial for the UAW and the car manufacturers to come to an agreement as soon as possible. They need to find a resolution that will minimise the losses and help both parties get back to business.
Overall, the strike by the United Auto Workers is having a significant impact on the car industry in the United States. If the strike goes on for much longer, it will only result in more financial losses for the car companies. It's important for all parties involved to find a solution quickly to avoid further damage to their profits.
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