The United Auto Workers (UAW) strike has cost the economy $4billion in lost wages and losses to manufacturers, dealerships and customers, a new report has found.
Workers lost $325 million in direct wages and Detroit’s big three – Ford, General Motors, and Stellantis (Chrysler) – lost $1.12 billion.
Suppliers lost $1.29 billion due to a decrease in demand for automotive parts and components, and auto dealers and customers lost $1.2 billion.
‘Suppliers were particularly hard-hit by the UAW’s strategy of announcing specific plants to be struck just hours before they were shut down,’ said Patrick Anderson, AEG’s principal and CEO.
Workers stand on the picket line outside the General Motors Lansing Delta Plant in Michigan. Anderson Economic Group (AEG) estimates the strike has cost the economy nearly $4 billion
UAW members striking at the Stellantis Toledo Assembly Plant in Ohio. The AEG report found that workers lost $325 million in direct wages
Workers take part in the strike at the Ford assembly plant in Chicago. On Monday, General Motors and Ford indefinitely laid off an additional 500 workers due to the strike
‘The shutdown of 38 parts distributions centers also crimped dealership service operations and, of course, caused more UAW workers to lose wages.’
Anderson noted that when distribution centers were shut down, the strike’s impact spread past the parties involved in negotiations and trickled down the dealers, customers and additional suppliers.
‘When the innocent bystanders begin to feel it, it will affect the generally supportive sentiment Americans have been expressing about the UAW’s demands thus far in the strike,’ he said.
The analysis did not include additional plant closures or strikes announced on or after September 29.
Union members have been on strike at Ford, Stellantis and General Motors plants in Michigan, Missouri and Ohio since September 15.
On Friday, UAW president Shawn Fain announced an additional 7,000 workers will join the picket line, bringing the total number striking to over 25,000.
AEG predicts the third week of strikes will significantly impact Ford, the newest round of strikes will impact production and sales of some of their most profitable models, the Ford Explorer and the Lincoln Aviator.
General Motors and Ford said on Monday they will be indefinitely laying off another 500 workers at four Midwestern plants due to the impacts of the strike.
On Friday, Ford Motor Chief Executive Jim Farley accused the UAW of holding negations hostage to force them to pay workers at a new battery plant.
A Scabby the Ray inflatable is driven by the Stellantis Toledo plant. The AEG report said manufactures lost $1.12 billion
Picketers get creative with their apparel while striking. The report found suppliers lost $1.29 billion and auto dealers and customers lost $1.2 billion
A UAW member is seen wearing a Jason mask while picketing. Automaker leaders have accused the UAW of holding the negotiations hostage
‘We believe the UAW is holding up the deal over battery plants that won’t come online for another two to three years,’ Farley said.
A statement from General Motors CEO Mary Barra on Friday nearly accuses Fain of negotiating in bad faith.
‘UAW leadership continues to expand the strike while upping the rhetoric and the theatrics. It’s clear that there is no real intent to get to an agreement,’ said Barra.
‘By their own admission, the UAW leadership’s plan from the beginning has been to drag their membership into a long, unnecessary strike to further their own personal and political agendas.’
‘It is clear Shawn Fain wants to make history for himself, but it can’t be to the detriment of our represented team members and the industry,’ she added.
UAW President Shawn Fain (right) posing with a supporter at the Stellantis Toledo plant. On Friday, Fain announced an additional 7,000 workers will join the picket line
President Joe Biden made history last week becoming the first modern president to join striking workers
President Joe Biden joined the picket line for 12 minutes last week, becoming the first president in modern history to join striking workers.
The union and automakers remain far apart on key economic issues. The UAW is asking for a 40 percent pay increase and an end to the two-tier wage system.
Automakers have countered with offers with a pay increase around around 20 percent.