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UAW Strike: Report estimates $4 billion in losses as impact spreads

The United Auto Workers (UAW) strike has triggered nearly $4 billion in losses across the automotive industry in the first two weeks of the union’s stoppage in protest of America’s “Big Three” automakers, according to a report released Monday.

Economic consulting firm Anderson Economic Group (AEG) estimates that the UAW “stand up” strike, which began September 15, has led to roughly $1.2 billion in direct losses for Ford, General Motors (GM) and Stellantis. The work stoppage has also led to $325 million in direct wages lost, $1.29 billion in supplier losses and $1.2 billion in losses for automotive car dealers and customers.

AEG’s evaluation does not account for the new strike sites announced on Friday, when an additional 7,000 UAW workers joined the picket lines at a Ford plant in Chicago, Illinois, and a GM facility in Lansing, Michigan. In total, more than 25,000 union members in 21 states are on strike, which comprises about 17 percent of the UAW’s membership.

“Suppliers were particularly hard-hit by the UAW’s strategy of announcing specific plants to be struck just hours before they were shut down,” AEG CEO Patrick Anderson said in a statement attached to Monday’s report. “The shutdown of 38 parts distribution centers also crimped dealership service operations and, of course, caused more UAW workers to lose wages.”

Looking forward, AEG predicts that the third week of the strike will be “significantly more costly for Ford,” which was spared when the UAW expanded its targets on September 22. The new targets added Friday, however, will likely result in Ford dealerships and customers “losing” some of the company’s most profitable vehicles, including the Ford Explorer and Lincoln Aviator, read the report.

“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,” Anderson added.

According to a poll from the group Navigator Research, most Americans are supportive of the UAW’s strike. In a survey of roughly 1,000 registered voters, on September 21 to September 25, 78 percent of respondents indicated that they viewed the walkouts favorably, compared to 22 percent who said they did not support the strike.

GM and Ford announced on Monday that the companies are laying off additional workers as a result of the strike. According to a report from Reuters, Ford is furloughing a total of 330 workers at its plants in Chicago and Lima, Ohio, while GM let go of 170 employees from its plants in Parma, Ohio, and Marion, Indiana.

GM previously laid off about 2,000 workers at an assembly plant in Fairfax, Kansas, citing a “shortage of critical stampings” due to workers who went on strike at a different facility in Wentzville, Missouri, CNBC reported. That same week, Stellantis let go 370 workers at factories in Ohio and Indiana.

During a press briefing on Friday, Ford warned that hundreds of thousands of jobs could be threatened due to the auto industry’s “fragile supply chain.” A spokesperson for Ford told Newsweek via email Monday that the company’s “focus remains on working diligently with the UAW to reach a deal that rewards our workforce and enables Ford to invest in a vibrant and growing future.”

Stellantis declined to comment on the AEG report, but said that conversations with UAW are ongoing.

In a statement to the Detroit Free Press on Monday, UAW President Shawn Fain said, “The decision to lay off workers is not a ‘ripple effect,’ it’s a decision made by the company to put the squeeze on our members to accept a weak contract,” Fain said. “GM owns it, and GM owns the fact that they took over a month to respond to our proposals, and have taken over another month to make serious progress.”

The union’s demands to auto manufacturers include wage increases, cost-of-living adjustments and a four-day workweek.

Newsweek reached out via email Monday night to the UAW and GM for comment.

Update 10/03/23, 4:20 p.m. ET: This article has been updated with additional comment from Stellantis.

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