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UAW strike costs GM nearly three billion dollars

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General Motors headquarters in Detroit

General Motors reports the 40-day strike by the United Auto Workers will result in a nearly $3 billion profit loss in 2019.

The automaker's output also dropped by about 300,000 vehicles because of the strike.

The company says it will be unable to make up much of that lost production because its SUV and pickup truck facilities were already operating at full capacity before the strike.

Patrick Anderson of Anderson Economic Group says the end result of the strike was a contract that had both pluses and minuses for the company.

"This particular labor agreement was expensive to reach," says Anderson.  "It doesn't reduce the cost gap between General Motors and its competitors."
 
Anderson says that could become important if there is a recession during the term of the four-year contract.
 
On the other hand, Anderson says, GM was able to hold its ground on the closures of three plants in the U.S. - one in Warren, Michigan, one in Baltimore, Maryland, and one in Lordstown, Ohio.
 
"They now have a much more flexible operating structure by closing three plants that they really can't operate profitably," he says.

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