Auto Workers Strike Could Cost GM Billions

AP:

If the United Auto Workers strike against General Motors Corp. lasts longer than a week or two, it could cost GM billions of dollars and stop the momentum the company was building with some of its new models, according to several industry analysts.

A strike of two weeks or less would not hurt GM's cash position and would actually improve its inventory situation, Lehman Brothers analyst Brian Johnson said Monday in a note to investors. But a longer strike would be harmful, causing GM to burn up $8.1 billion in the first month and $7.2 billion in the second month, assuming the company can't produce vehicles in Mexico or Canada, Johnson wrote.

Read the whole story: AP

Comments

[theeconomicfractalist]

06:38 AM on 09/26/2007

The GM Terminal Fractal Sequence

0639 26 September: with the coincidental conclusion of the strike, GM is completing a terminal 3/7/5 of 5-7 day fractal which concludes a 66-69/170/134 of 132-136 day Lammert growth fractal sequence. It is unlikely that the Wilshire will best its 19 July 2007 high which occurred in the 22nd month in the third fractal of a 11/27/22 month fractal growth series. Like the CRB, the Nasdaq 100 has bested its 19 July 2007 high but is approximately 55 percent lower than its March 2000 high. As a marker for the top of the NDX, look for a gap opening above the previous day's high with a close at the low of the trading day. That is likely to occur this trading day or within the next 3 trading days.

[totalliberal]

09:33 PM on 09/25/2007

This whole society is based on the premise that in order to be successful you must consume as much crap as possible.

On the other hand the capitalists who support this system demand that the workers take less and less in compensation.

Now how do they figure that this will bring economic prosperity to them, when the minions stop buying their crap because they can't afford it.

Yet Milton Friedman and his ilk demand that the workers take less, so that more money will be created.

Is he just stupid?

No, just incredibly short sighted.

[BDW]

03:51 PM on 09/25/2007

This strike affects a great deal of people. There are at least 3 times as many as those striking that will be burdened by this just for those who work at GM dealerships who need the timely flow of new product to maintain sales. Very few of the support staff of those dealerships earn anywhere near $25+ per hour.

The reason for the strike is that the union is demanding ten years of guaranteed job protection for giving up the pension and insurance benefits this past summer. I believe in unions and buying and making American produced vehicles, but this is not grounds enough for the strike when negotiations were said to be amicable. Note also that the union targeted to strike against GM instead of the other two because of their large cash reserves. The UAW also happens to have $9 billion in reserves for compensation during a strike.

"I THINK VEHICLES are SO OVER PRICED "

In real dollars adjusted for inflation, vehicles cost about as much today as they did in 1957.

[VEGAN]

03:17 PM on 09/25/2007

What is the STRIKE all about?

Sometimes when people strike they have a justified reason, other times they do not have a justified reason.(and they risk losing their job all together)

I THINK VEHICLES are SO OVER PRICED and not as many people are "going for it" like they use to... people are waiting for the industry to change...

Do you think that There are some people who do not have jobs in this WORLD MARKET and they would be GLAD to have the job that these workers "strike against", ?

[Portnoy]

02:13 PM on 09/25/2007

Know what a good idea would be? All you supporters of the UAW and not in unions, should walk out of your jobs today to support these people. If you all do it, its a revolution, right? And the majority of Americans support these workers, right? So...what is really to fear from walking out the door right now?

Well...?

[realitytrumpsbull]

01:30 PM on 09/25/2007

Robots work fast...

[totalliberal]

08:57 PM on 09/25/2007

["Robots work fast..."]


But they can't buy cars. Someone has to buy their crap.

[givemycountryback]

12:26 PM on 09/25/2007

These men and women are literally fighting for their jobs. Wouldn't anyone. GM does not want to offer any job security, that is the problem.And itis not just GM, its all the auto mfg. GM was the taget. Organized labor all over this country should back these workers. We are becoming a country of Mc jobs if you are lucky enough to get one. If management works with the union, I think they can bring GM out of its slump. But they are a very rich company. They do not just make cars. The outsourcing of mfg. jobs has to stop, if it is not too late. We should all be able to make a living wage and if the labor movement is broken, which is exactly what the repugs want, we have no chance. This will be a country of the haves and haves not. Oh I forgot, it already is.

[GhostofBillHicks]

11:30 AM on 09/25/2007

These workers are getting ready to get screwed.
This economy does not value WORK,only investments.
GM will have to make up their "losses" due to high gas prices.
Most of the used car lots where I live are full of SUVs and full-size pickups.

[Wiredwilly]

10:03 AM on 09/25/2007

Good for them. GM sold my 85 year old mother a new car and when she passed away tried to bill ME for the car so they could put it back on the lot and sell it again, in effect selling it twice, exploiting an old woman and her grieving family in the process.
You can imagine how I feel about GM.
I hope they organize China,India, Mexico while they're at it.

[wadenelson1]

09:15 AM on 09/25/2007

The automaker that convinced American consumers that driving a 11mpg Hummer is "cool" deserves nothing less then to hear the call of Schumpeter's trumpet.

[RabidRightRebel]

08:15 AM on 09/25/2007

It is about time that American workers started standing up for themselves. The future of this great nation does not depend on how much money a few executives can pay themselves but rather how well we treat our workforce. The consant outsourcing of American job must stop. While short term profits are critical to Wall street, long term sustatainable jobs are essential for the America.