Ford, GM, Chrysler brace for strikes
The Big 3 could face production halts next week if they can't reach an agreement with Canadian workers.
However, the automakers may have bigger issues in the autumn months as strike preparations are underway in Canada that threaten to stop production on more than a dozen popular models.
According to The Detroit News, a lengthy strike by the Canadian Auto Workers (CAW) union could, "ripple and hinder production by Detroit's Big Three in the U.S." A CAW strike in 1996 lasted more than three weeks.
Vehicles that could eventually be impacted by such a strike include Chrysler's Town & Country minivan, General Motors' Chevrolet Equinox/GMC Terrain SUV and even the highly popular Ford Edge and Lincoln MKX. The CAW is set to begin striking sometime after 11:59 p.m. on Sept. 17 if a contract agreement is not reached between the union and the Detroit automakers before then.
The Detroit automakers have not made public production plans in case of a strike. "Ford, GM and Chrysler have remained silent on contingency plans should more than 18,000 CAW members strike; all three have options should a strike drag out, although those options are limited," The Detroit News reported early Thursday morning.
In addition to the union problems in Canada, Ford faces problems in Europe and may be closing a factory in Belgium to address near-term European challenges.
Ford introduced 15 new models overseas last week in order to increase consumer demand. The restyled vehicles will make their debut over the course of the next five years, with the company noting that they are investing in the future, despite the current economic crisis.
"Ford [management] downplayed the likelihood of a European downturn as deep as the U.S.'s during the financial crisis," analysts at Jefferies said following a meeting with Ford executives.
"There does seem to be at least some variable capacity that Ford can take out. We got the sense that Ford is targeting a restructuring plan that will result in break-even operations at current industry production volumes."
As revamped models and plant closings find their way onto Ford's European to-do list, it appears that a restructuring plan is well underway there. Ford and its competitors will have to explore options to combat what might be an ugly fight in neighboring Canada if the pending strike occurs.
Both Ford and General Motors were down slightly in midday trading.
More from Benzinga
MORE ON MSN MONEY
VIDEO ON MSN MONEY
A union in Canada is going to strike! We the taxpayers of THE UNITED STATES OF AMERICA bailed out GM and this is what we get for our money. It was a UNION NOT AUTOMAKER BAILOUT. GET REAL!
Also,we might need to separate private and public unions that are paid by the tax-payer (teachers,police,firefighters). Do union bashers enjoy less money and benefits? Companies can make record profits but for workers,it seems like a race to the bottom.
Still sucking on that TAILPIPE... the US is getting exactly what it deserves in the middle east...even after President Bush said, America is addicted to OIL people are not demanding the Electric car to balance out the greed on both sides.
The Saudi Royals are getting over $100 dollars a barrel for 1 barrel of crude...they have been in heaven since 9/11 and what does the Americans and the rest of the free world do give OPEC MORE...
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
[BRIEFING.COM] Equity indices closed out the month of August on a modestly higher note. The Russell 2000 (+0.6%) and Nasdaq Composite (+0.5%) finished ahead of the S&P 500 (+0.3%), which extended its August gain to 3.8%. Blue chips lagged with the Dow Jones Industrial Average (+0.1%) spending the bulk of the session in the red.
The final week of August represented one of the quietest stretches for the stock market so far this year. The first four sessions of the week produced the ... More
More Market News
|There’s a problem getting this information right now. Please try again later.|