The number of vehicles on dealer lots will shrink the longer the walkout goes on. Dealers are likely to lose incentives that the manufacturers pay them to boost sales by cutting prices.Many analysts think it will take several weeks before dealer lots start to look a bit empty. Ford, General Motors and Stellantis built up inventories of vehicles ahead of Thursday night’s strike, and the UAW decided to limit the walkout to just three plants – at least for now.
Labor negotiations continue in good faith, said Mark Stewart, chief operating officer for North America at Stellantis. He detailed on Saturday his company’s latest offer to the union, which included cumulative raises of nearly 21% in hourly wages. That’s roughly in line with proposed wage increases from Ford and GM, though short of what the union wants.
If the strike isn’t ended soon, however, there could be shortages of some makes and models –big sellers or vehicles that are already in short supply, such as Chevrolet Silverado and Tahoe, GMC Sierra and Ford F-Series pickups. The car companies have plants in Mexico that could keep producing some models – as long as they have a supply of parts.
“You’ll start to see that pricing gets affected everywhere — and not just on the new end of the business,” Drury says. “Used-car values, which have been seeing a bit of a decline from last year’s highs, could start going back up” as consumers look for an affordable alternative to new vehicles. Car prices were rising long before the auto workers even raised the possibility of a strike. A chip shortage, disruptions in the global supply chain and strong demand pushed prices higher.
“It’s almost a foregone conclusion that the UAW will succeed in getting substantial wage increases,” says Patrick Anderson, the founder of Anderson Economic Group, a research firm that conducts market analysis. “Part of that is simply due to inflation, part of that is due to the profits of the automakers, and part of that is due to the leverage that the UAW has right now with a short inventory and an economy that still has a lot of people that want to buy cars.
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