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The UAW warned earlier this week that more U.S. factories would go on strike if no progress is made in talks with the automaking giants. In a video message on Monday, UAW president Shawn Fain flagged that recent negotiations had proved fruitless, adding that the union was not going to allow the so-called Detroit Three car companies to “drag this out.” The union and the firms are at odds over pay and employee benefits.
More work stoppages could be announced on Friday, Fain said. Walkouts at plants in Michigan, Ohio and Missouri have already halted production of popular models like the Ford Bronco, Jeep Wrangler and Chevrolet Colorado.
In a note to clients, the Barclays analysts argued that these strikes have so far targeted output of the carmakers’ midsize pickup and sport utility vehicles, and left the firms’ more profitable large truck sites as leverage should the talks not make any “serious” headway.
The analysts added that they assume the next possible round of strikes could begin to affect some of these truck plants.
However, they said that the auto companies appear to be prepared for this situation “given robust ingoing inventory.” At the end of August, the Detroit Three all held more than 65 days of inventory, which the Barclays analysts highlighted as “quite elevated” compared to the companies’ post-COVID objective of 50 to 60 days.
