A lot of pressure has mounted up on United Auto Workers and General Motors to reach a final agreement to end the strike by the union against the famous automakers which is now in its 19th consecutive day.
General Motors stock has been falling in double digits ever since the strike started, and another nail to the coffin was the weakened auto sector. Nearly all the North American plants of the company are doing no production whatsoever. These plants also include their most profitable SUV and pickup truck production. This strike will soon be reflected on the dealers.
According to Art Wheaton, who is a labor expert, both sides are facing a lot of issues but GM is under more pressure due to the financial losses they are incurring. He also said that currently the public is favoring the UAW’s case which is putting more and more pressure over the automakers.
Experts believe that GM currently has enough cash in their inventory to continue like this for months but recovering from these loses is getting tough day by day specially for their pickup and SUV manufacturing.
According to a statement from Lightbody, both sides are currently at a standstill position during their talks. He believes that in the end it will come down to which side sees loss and compromises for better.
The main motive of GM for this negotiation is to bring their per hour labor cost to $63 per worker so that they can be competitive to other manufacturers in America as well as foreign. According to the report from Lightbody GM currently pays their worker $13 per hour more than other manufacturers, this converts to a big disadvantage for the company as it totals up to $5 billion for 4 year contracts. Their competitors Ford pay $61, Chrysler pays $55 according to Centre for Automotive Research.