GM Could Lose $15 Billion From Strike

Tense discussions and terse words as GM strike talks move on

Labor leaders for the United Auto Workers are expected to resume talks with representitives of General Motors later today.  After 22 straight days of talks failed to bring the two sides to a contract agreement, 73,000 union workers walked out of 80 GM plants across the United States.

Bosses at UAW say the sticking issue is job security.  While companies like Toyota have hired more workers in the United States over the last decade, American automakers - including GM - have been making cuts.  The workers want GM to agree in writing that future models of cars and trucks will continue to be build in American facilities, decreasing the chances of more job losses.

Negotiators left the bargaining table at 8 p.m. Detroit time on Monday.  They are expected to return Tuesday morning.

A UAW strike of less than two weeks is not expected to criple GM, which currently has a stock of about 950,000 vehicles.  However, should the work stoppage last longer GM could be out billions of dollars at a time when the company was beginning to pick up some steam.  Three GM vehicles, the Buick Enclave, GMC Acadia, and Saturn Outlook, have all been earning well for General Motors, but the supply of these crossovers is running low.

In a letter to investors, one Lehman Brothers analyst estimates a monthlong strike to cost GM $8.1 billion dollars.  Two months could cost the car maker over $15 billion.

This strike may be especially damaging to auto parts suppliers, many of which have been in-and-out of bankruptcy court recently.  

"Every car that's not built means there's 10,000 components that don't get sold and don't get put on the car," Neil De Koker told the Associated Press.  De Koker is president of the Original Equipment Suppliers Association, an industry trade group.

"If it's four or five days it won't be nearly as traumatic as four to five weeks.''

The strike will also hit the pocketbooks of striking UAW members.  They will receive $200 per week, plus healthcare coverage, from the union's strike fund.

This is the first nationwide United Auto Workers strike in three decades, and the first against GM in 37 years.