Detroit 3 fall as UAW begins strike
The stock prices of Detroit automakers General Motors (NYSE:GM) and Ford (NYSE:F) have declined in pre-market trading Friday, while Stellantis (NYSE:STLA) has seen a slight increase. This shift in stock prices follows reports of an impending walk-out and strike by the United Auto Workers (UAW) union against the Big Three companies.
Before the September 14th deadline at 23:59 ET (03:59 GMT), negotiations between the UAW and the management teams of Ford, General Motors, and Stellantis failed to reach an agreement on new contract proposals. Consequently, the union has initiated a series of strikes at specific plants. UAW President Sean Fain has characterized this as a «stand-up strike» aimed at disrupting the operations of all three OEMs simultaneously.
The initial round of strikes targets specific facilities, including the Ford Michigan Assembly Plant in Wayne, the Stellantis Toledo Assembly in Ohio, and the General Motors Wentzville Assembly in Missouri.
“strikes targeting specific plants could turn into a logistical nightmare for The Detroit Three as it relates to the supply chain,” CFRA analysts wrote in a note.
«This strategy will keep the companies guessing. It will give our national negotiators maximum leverage and flexibility in bargaining. And if we need to go all out, we will. Everything is on the table,» said UAW President, Sean Fain.
After speaking with investors, Morgan Stanley analysts wrote that they only expect a “small negative market reaction” to the Ford, GM, and Stellantis share prices early on. According to the analysts, a strike outcome was the overwhelming consensus, as an investor survey showed 82% of respondents expecting a strike.
“Moving forward, we expect all three stocks to be sensitive to UAW
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