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The impact of the UAW strike against American Axle & Manufacturing continues to reverberate through the industry and the supply base as nearly thirty General Motors facilities including vehicle, powertrain and component operations are now affected. Lost vehicle production now exceeds 5,300 units per day and is expected to climb higher as additional facilities are faced with shortages in the coming days.
Output at GM’s Wentzville operation ended on Thursday of last week beginning with the second shift, ending output of full-size vans. GM’s Arlington facility remains in operation and reportedly has adequate part supplies to maintain production for over two weeks through the end of March. The impact at Janesville is unique as they currently operate on a four day work week and are set to work a short shift scenario through 14 March, before output is expected to stop completely during the week of 17 March. Furthermore, the facility had already planned to be down for the first week of April as the plant prepares to adjust its line rate lower. Output at Shreveport continues without interruption, yet, we continue to monitor the affects due to the closures of powertrain and component operations. All production facilities are scheduled to be off on Friday, 21 March, proceeding the Easter holiday.
CSM forecasts that the impact of the strike will now spread to Chrysler during the week of 17 March, beginning with short shifts at its Newark assembly plant that builds the Dodge Durango and Chrysler Aspen SUVs.
Both sides are holding steadfast in their positions and at this point a breakthrough appears unlikely in the coming days. The cumulative strike impact in terms of lost output is estimated to surpass 48,000 units by the end of this week. Barring an agreement, the cumulative impact of lost volume by the end of next week will climb to just under 75,000 units. In light of heavy inventories on full-size full frame light trucks, much of the production lost will not be replaced, leading to a constrained production outlook for 2008 at 14.3 million units.
For questions, please contact Mike Jackson,
Director, North American Vehicle Forecasts,
at mikejackson@csmauto.com or +1 248 465 2833
For questions, please contact Joe Langley,
Senior Market Analyst, North American Vehicle Forecasts,
at joelangley@csmauto.com or +1 248 465 2832