President Biden joins the picket line as manufacturers scramble for parts. So far, the strike impact is minimal but that can change fast.

Picket line image from YouTube video below

UAW Strike Sends GM, Stellantis Scrambling to Keep Repair Parts Flowing

The Wall Street Journal reports UAW Strike Sends GM, Stellantis Scrambling to Keep Repair Parts Flowing

General Motors and Chrysler-parent Stellantis have devised plans for white-collar workers to staff parts-distribution centers as they aim to blunt the fallout from the United Auto Workers’ walkout.

Ahead of the strike, Stellantis additionally leased a nonunion warehouse and banked 30 days of inventory for 2,500 different types of parts, which are used for customer maintenance and repairs at dealerships, according to a document seen by The Wall Street Journal.

A Stellantis spokesman declined to comment on plans to use a warehouse or salaried workers to process parts, adding that the company is disappointed the union “chose to disrespect our customers” by striking at the parts hubs, and that it has contingency plans to meet customer demands.

GM also has made plans to use white-collar workers to handle parts shipments, people familiar with the plans said. The company used the same strategy during a 40-day strike in 2019 to keep components flowing to dealerships. “We have contingency plans for various scenarios,” a GM spokesman said. “We are evaluating if and when to enact those plans.”

“These distribution centers are really a key function to the supply chain,” said Jeff Schuster, an analyst at industry research-firm GlobalData. “Dealers who didn’t prepare for this are probably already starting to feel the pinch on their parts availability,” said Brad Sowers, a Missouri dealer who sells GM and Stellantis brands. Most dealerships typically get parts shipments daily, on a just-in-time basis.

Last week, GM idled a Kansas plant that relied on work from the company’s other facility targeted by the UAW, resulting in 2,000 temporary layoffs. Stellantis also temporarily laid off 68 workers at a machining plant affected by the UAW’s strike at a Jeep factory in Toledo, Ohio, and said an additional 300 workers could be affected at a facility in Kokomo, Ind.

“Keep ‘Em Guessing”

On September 17, I asked Was Anyone Surprised by the UAW’s Alleged Surprise Attack Strike?

UAW Shawn Fain’s allegedly brilliant strategy to “Keep ‘Em Guessing” so far looks like a big dud. The companies prepared as mush as they could, and so did many dealers.

The dealers who didn’t stockpile might be in trouble.

Artificial Boost to GDP

That stockpiling undoubtedly led to surges in orders artificially boosting GDP.

The downside whiplash has now begun and will show up in future orders.

Upping the Pressure

Fain says he will up the pressure. OK. But what about the consequences?

If the Big 3 cannot get parts, then it will shut down plants. Laid off workers do not get strike pay but they do get unemployment benefits.

How much are unemployment benefits compared to regular wages?

Tick Tock

Clearly upset at how negotiations are going, UAW president Shawn Fain posted a profane movie clip. “Tick tock mother******”

Image clip from the movie “The Hitman’s Bodyguard,” via Shawn Fain Tweet.

For discussion, please see Tensions Flare at UAW in Shawn Fain’s Quick Update Tweet

Does the UAW United Auto Workers Union Merit a Huge Raise?

Let’s get to the heart of the matter: Does the UAW United Auto Workers Union Merit a Huge Raise?

The US big 3 automakers have just two of the top ten 10 dependable brands ranked by J.D. Power and just one of the 10 best cars picked by Consumer Reports, note Greg Ip at the Wall Street Journal.

Beyond autos, Boeing has been plagued by production and quality issues. Airbus delivered three times the number of aircraft than Boeing.

Elon Musk Taunts the UAW, “Tesla Pays Workers More and We Have Fun”

Production costs are far cheaper at Tesla and nonunion plants.

For discussion, please see Elon Musk Taunts the UAW, “Tesla Pays Workers More and We Have Fun”

The unions want protection from foreign competition, from Tesla, from EVs in general, and higher wages to boot while producing lower quality cars.

A huge UAW pay increase will only exacerbate the problem.

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