UAW’s strikes take financial toll on US economy, exceeding USD9B in losses

(MENAFN) The United Auto Workers' (UAW) concurrent but geographically limited strikes against Ford, General Motors, and Stellantis have taken a significant financial toll on the U.S. economy, exceeding USD9 billion in losses. This astounding figure represents more than double the previous record for a strike in the auto industry within this century. Fresh data, recently disclosed by Michigan's Anderson Economic Group (AEG) on a Monday, reveals that the UAW's labor actions against Detroit's Big Three have caused substantial economic consequences for the auto industry, tallying up to approximately USD9.3 billion as of October 19th, marking the fifth week of the strike.

Breaking down the cost, the UAW's strikes have affected various stakeholders in different ways. Workers have suffered a collective loss of USD488 million in wages, while the automakers themselves have reported combined losses amounting to roughly USD4.18 billion. Dealers and customers have shared a financial burden, with losses reaching USD1.86 billion, and suppliers have been dealt a severe blow, facing losses exceeding USD2.78 billion.

Patrick Anderson, the Principal and CEO of AEG, expressed concern over these staggering figures. He pointed out that the cost of the ongoing strike has now doubled that of the 2019 UAW strike against General Motors. Furthermore, he emphasized that the impact extends beyond the Big Three automakers and is causing significant layoffs among supplier companies.

Two weeks ago, AEG had already issued a warning, predicting that if the strike persisted, manufacturers would have no choice but to postpone or even cancel planned investments. Sadly, their predictions have come true, as both GM and Ford have announced such actions. Anderson anticipates that more announcements of this nature will follow should the strike continue unabated.

The UAW's strike began on September 15th, initially targeting one major assembly plant at each of the three automakers. As the labor dispute has unfolded, the UAW has expanded its strike efforts, gradually adding more striking locations. This escalation underscores the complexity and severity of labor disputes within the automotive industry, demonstrating the economic stakes involved for all parties and the broader implications for the U.S. economy.

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