Autoworkers strike cuts into GM earnings, company sees further loses if walkouts linger

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A strike by autoworkers against General Motors is expected to cut the automaker's pretax earnings by $800 million this year, and another $200 million per week after that. That's according to the company’s chief financial officer. And those figures just include factories that are on strike now by the United Auto Workers union.

FILE- In this April 23, 2018, file photo, the logo for General Motors appears above a trading post on the floor of the New York Stock Exchange. General Motors reports earnings on Tuesday, Oct. 24, 2023. FILE - United Auto Workers members hold picket signs near a General Motors Assembly Plant in Delta Township, Mich., Sept. 29, 2023. As the auto workers strike approaches the one-month mark, more Americans sympathize with the striking workers than with the three big car companies that employ them.

Jacobson said the third-quarter strike loss was $200 million, since the walkouts were only in effect the final two weeks of the period. He predicted another $600 million of losses from October through December. He said many have expressed concerns about the company taking on higher labor costs, but GM has planned for it by cutting in other areas. For example, GM’s annual fixed costs will be $2 billion lower than 2022 by the end of 2024, Jacobson said. The company also is slowing electric vehicle production to adjust to slower short-term growth in demand.at one Michigan electric pickup truck factory from this year until late 2025 to keep manufacturing in line with demand.

Demand for vehicles and prices remained strong through the third quarter, which helped keep GM’s profit high. The company’s U.S. sales rose 21%, and Jacobson said the average U.S. selling price for GM vehicles was $50,750, down only slightly from the previous quarter.

 

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Autoworkers strike cuts into GM earnings, company sees further loses if walkouts lingerA strike by autoworkers against General Motors is expected to cut the automaker's pretax earnings by $800 million this year, and another $200 million per week after that.
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