President Biden joins the picket line as manufacturers scramble for parts. So far, the strike impact is minimal but that can change fast.
UAW Strike Sends GM, Stellantis Scrambling to Keep Repair Parts Flowing
The Wall Street Journal reports UAW Strike Sends GM, Stellantis Scrambling to Keep Repair Parts Flowing
General Motors and Chrysler-parent Stellantis have devised plans for white-collar workers to staff parts-distribution centers as they aim to blunt the fallout from the United Auto Workers’ walkout.
Ahead of the strike, Stellantis additionally leased a nonunion warehouse and banked 30 days of inventory for 2,500 different types of parts, which are used for customer maintenance and repairs at dealerships, according to a document seen by The Wall Street Journal.
A Stellantis spokesman declined to comment on plans to use a warehouse or salaried workers to process parts, adding that the company is disappointed the union “chose to disrespect our customers” by striking at the parts hubs, and that it has contingency plans to meet customer demands.
GM also has made plans to use white-collar workers to handle parts shipments, people familiar with the plans said. The company used the same strategy during a 40-day strike in 2019 to keep components flowing to dealerships. “We have contingency plans for various scenarios,” a GM spokesman said. “We are evaluating if and when to enact those plans.”
“These distribution centers are really a key function to the supply chain,” said Jeff Schuster, an analyst at industry research-firm GlobalData. “Dealers who didn’t prepare for this are probably already starting to feel the pinch on their parts availability,” said Brad Sowers, a Missouri dealer who sells GM and Stellantis brands. Most dealerships typically get parts shipments daily, on a just-in-time basis.
Last week, GM idled a Kansas plant that relied on work from the company’s other facility targeted by the UAW, resulting in 2,000 temporary layoffs. Stellantis also temporarily laid off 68 workers at a machining plant affected by the UAW’s strike at a Jeep factory in Toledo, Ohio, and said an additional 300 workers could be affected at a facility in Kokomo, Ind.
“Keep ‘Em Guessing”
On September 17, I asked Was Anyone Surprised by the UAW’s Alleged Surprise Attack Strike?
UAW Shawn Fain’s allegedly brilliant strategy to “Keep ‘Em Guessing” so far looks like a big dud. The companies prepared as mush as they could, and so did many dealers.
The dealers who didn’t stockpile might be in trouble.
Artificial Boost to GDP
That stockpiling undoubtedly led to surges in orders artificially boosting GDP.
The downside whiplash has now begun and will show up in future orders.
Upping the Pressure
Fain says he will up the pressure. OK. But what about the consequences?
If the Big 3 cannot get parts, then it will shut down plants. Laid off workers do not get strike pay but they do get unemployment benefits.
How much are unemployment benefits compared to regular wages?
Tick Tock
Clearly upset at how negotiations are going, UAW president Shawn Fain posted a profane movie clip. “Tick tock mother******”
For discussion, please see Tensions Flare at UAW in Shawn Fain’s Quick Update Tweet
Does the UAW United Auto Workers Union Merit a Huge Raise?
Let’s get to the heart of the matter: Does the UAW United Auto Workers Union Merit a Huge Raise?
The US big 3 automakers have just two of the top ten 10 dependable brands ranked by J.D. Power and just one of the 10 best cars picked by Consumer Reports, note Greg Ip at the Wall Street Journal.
Beyond autos, Boeing has been plagued by production and quality issues. Airbus delivered three times the number of aircraft than Boeing.
Elon Musk Taunts the UAW, “Tesla Pays Workers More and We Have Fun”
Production costs are far cheaper at Tesla and nonunion plants.
For discussion, please see Elon Musk Taunts the UAW, “Tesla Pays Workers More and We Have Fun”
The unions want protection from foreign competition, from Tesla, from EVs in general, and higher wages to boot while producing lower quality cars.
A huge UAW pay increase will only exacerbate the problem.
I read today that already the UAW has backed off the 40% raise and is saying 30% will do.
The big 3 need to keep playing hardball.
Obtaining parts was not a problem back in the day –
link to m.youtube.com
Back in the day, is so long ago now.
Biden’s handlers could have set up the picket line on the southern border and kill two flies with one strike. It would show Biden supporting the unions, and also no illegal border crossing would happen while he is shuffling there. A win-win.
Those warehouses store parts that Ford GM and Stella use for just in time production.
Good!
So the Workers are getting just what they voted for. Soon they will face more layoffs, and eventually they will start complaining, as is typical for people who chase something for nothing.
I feel bad for people that are stuck awaiting parts, but that really has much less to do with reality, and more to do with fear. They need pressure on the Government (Who backs the Union Demands stupidly), and people crying to the MSM or they will just make it up anyway.
They are going to go bankrupt if this passes, and everyone will be getting paid by Taxpayers, as Biden Inc. pays them to stay home on the Public’s dime of course.
Keep it up…
They’re going bankrupt anyway. This will just speed it up. They can’t compete with Tesla and Chinese auto makers. They don’t know how to make EVs. You can’t make them the same way you make gas vehicles and it’s too late for them to change.
Basically Tesla has a quasi-monopoly set up in EVs when it comes to market share and profitability worldwide. What is incredible is that he has done the same thing with SpaceX. SpaceX accounts for something like 83% of all tonnage sent into orbit this year and risks going even higher when the Starship comes online. Its a quasi-monopoly in market share and profitability. Starlink is not there yet but it looks like it will be the market leader and the most profitable. It’s like game over before you knew there was a game. In one sector OK but in three at the same time?
If he figures out Twitter/X maybe it will be 4. Then there’s neuralink.
The left says climate change is our biggest threat. Elon is in favor of free speech. So, they hate the person who’s done more to fight climate change than anyone else, by far. Seems eliminating criticism/opposing viewpoints/people knowing the truth is their actual biggest threat.
Big 3 could end this on the cheap with free fast food twice a week. It’s obvious they like their junk food. My wife’s company does this with hourly workers.
Just don’t mess up their orders and absolutely no healthy stuff like tuna or samon wraps. The new HR person tried to order them healthy food one week. All hell broke lose like a real strike from the 30’s or something. Not this Disney Fain strike.
Funny!
Protection from Tesla is going to be very difficult. They are by far the low-cost producer and make more when no one else can. Likely the government will try to impose unionization in its plants but that will go nowhere. In two moves the king is in checkmate.
Tesla is way smarter than everyone else. Even if they’re forced to unionize, they’ll figure out a way to implement it way smarter than the big 3.
You can’t force unionization in right to work states. There is a reason Musk setup his facilities where he did and why other foreign car makers also make cars in non-union states.
It’s far more likely that Tesla would be broken up via anti trust as AT&T was in the 80s and Microsoft was forced to back off in the late 90’s during their browser anti-trust trial.