Unfazed by union strikes: General motors outperforms with robust Q3 sales amid industry challenges

In the midst of an ongoing strike by the United Auto Workers (UAW) union, General Motors (GM) has reported a minimal direct impact on its third-quarter U.S. new vehicle sales. Despite the labor unrest, GM witnessed a 21.4% surge in sales from July through September, outpacing auto analyst predictions for the overall industry of 15% to 16% for the same period. The robust sales performance comes even as the industry continues to grapple with supply chain issues. Every brand under the Detroit automaker banner registered sales growth compared to last year. However, not all auto manufacturers enjoyed similar success in Q3. Toyota Motor reported a 12.2% increase; Hyundai Motor roughly 9%; Kia about 14%; Mazda about 22%; and Honda approximately 53%. On the other hand, Stellantis experienced a slight dip in sales by 1.3%, not likely linked to UAW strikes but rather their strategy of retaining high profits by not heavily discounting vehicles as in previous years. Despite the current resilience, GM and other companies could encounter sales and supply chain hiccups if the UAW strike extends or intensifies. Approximately 17% of UAW members covered by expired contracts with GM, Ford Motor and Stellantis are currently participating in work stoppages. The UAW has been incrementally escalating strikes since they commenced on September 15th after negotiations failed to reach agreements by September 14th. Rather than launching nationwide walkouts, targeted or “stand up” strikes are being implemented to safeguard union funds and prolong work stoppages, aiming to destabilize automakers’ operations. While immediate impacts have been subdued, repercussions of the strike will likely start reflecting from October on certain vehicles such as Chevrolet Colorado and GMC Canyon midsize pickups whose production has been impacted by work stoppages. GM’s Q3 performance was buoyed by rising sales of newer, entry-level models such as the Chevrolet Trax and Buick Envista, imported from South Korean plants. The automaker also launched new electric versions of its Chevrolet Blazer SUV and Silverado pickup during this period, contributing to over 20,000 electric vehicle sales, a 28% increment compared to Q2. However, their electric vehicle sales still lag behind those of Tesla.