The mounting costs of strikes and eventual contract settlements are putting plans for EV development and shareholder profits at risk, say analysts.
"Reduction in capital spending, delayed EV targets, greater sharing of costs, and other changes to the corporate 'portfolio' could be on the horizon,"will report third-quarter results Oct. 24, with Ford following on Oct. 26. GM has already telegraphed a $200 million hit to third quarter profits from strike-related costs.
After a senior Ford executive said the automaker had reached the limit of what it could spend on a new union contract, Fain replied:"Go get the big checkbook. The one Ford uses when it wants to spend millions on company executives or Wall Street giveaways." Fain points to a 1,500% increase in the money spent on share buybacks by the Detroit Three over the past four years to argue the automakers can afford substantial UAW wage increases.
In July, GM trimmed its planned spending this year on electric vehicles and battery plants to between $11 billion and $12 billion. Previously, the company had said it could spend up to $13 billion this year on EV and battery plant development. The company also raised its cost-cutting target through next year by $1 billion. on a planned $3.5 billion battery plant in Marshall, Mich.
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