General Motors (GM) is facing a higher risk than its rivals Ford Motor and Stellantis of disruption to electric vehicle (EV) production due to an ongoing United Auto Workers (UAW) strike. However, some analysts argue that the strike might also provide GM with an opportunity to address and resolve some of its existing issues.
While Ford and Stellantis are focusing on introducing revamped combustion-engine models this fall, GM’s immediate attention is on EVs. The company plans to launch or increase production of at least five new EV models, including electric versions of its Chevrolet Silverado and GMC Sierra pickups.
GM has been encountering difficulties throughout the year, especially in battery manufacturing, EV supply chain, and logistics. Issues such as battery module assembly problems have affected the delivery of vehicles to dealers. In the second quarter, GM delivered fewer Lyriq and Hummer EVs than expected due to these challenges.
A prolonged strike could provide GM with an opportunity to address these ongoing issues. By temporarily suspending production, the company would have the chance to resolve bottlenecks in its EV and battery operations. It could potentially accelerate output once the factories resume operations.
However, some analysts believe that the strike will not work in GM’s favor. The potential loss of billions of dollars outweighs any potential benefits of resolving technical issues. The strike comes at a crucial period for GM’s EV plans, with increased competition and the need to iron out any kinks in their EV launches, distribution, and marketing.
Furthermore, the UAW strike in the United States could also impact the flow of essential auto parts to GM’s operations in Canada and Mexico. This would further impede EV production in those regions.
In conclusion, GM faces a higher risk of disruption to EV production from the UAW strike compared to its competitors. While a strike could provide an opportunity to address ongoing issues, the potential financial losses and the crucial timing of EV execution make it a challenging situation for the company.