US auto strike's economic fallout starts to hurt global businesses
By Shivansh Tiwary and Raechel Thankam Job
(Reuters) — Businesses ranging from airlines to auto parts makers are starting to feel the heat from the month-long strike by hourly workers at the Detroit Three automakers, with analysts warning that the financial hit could increase if the walkout does not end soon.
With the United Auto Workers (UAW) strike entering its 36th day and the total economic cost pegged at more than $7 billion, companies are counting the cost of lost revenue amid an uncertain economy and persistent inflation.
«The damage from the strikes will last long after UAW members return to work,» University of Michigan professor Erik Gordon said.
Workers will also be careful about how they spend their money since strike pay is lesser than regular pay, he said.
U.S. carrier Delta Air Lines (NYSE:DAL) earlier this month became one of the first big companies to flag a hit after it said the strike has curtailed a «significant» amount of business in Detroit.
Paints and coatings maker PPG Industries (NYSE:PPG) said earlier this week it had included a profit hit of a «few cents» per share in its fourth-quarter forecast, while railroader Union Pacific (NYSE:UNP) said the strike has had a small impact so far.
Analysts said trucking firms and suppliers that make parts for the General Motors (NYSE:GM), Ford Motor (NYSE:F) and Stellantis (NYSE:STLA) are among the most exposed to a strike, which has seen more than 34,000 workers walkout from their daily jobs.
«Trucking companies deliver a lot of the components that are assembled into cars. They and their workers will suffer,» Gordon said.
With major parts suppliers such as Aptiv (NYSE:APTV), Magna International (NYSE:MGA), Lear (NYSE:LEA), and American Axle (NYSE:AXL) set
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