UAW Strike: What will this cost GM per day?
The longer the United Auto Workers strike lasts, the bigger the losses that General Motors will have to face.
The strike could cost GM at least $77 million a day, Morningstar analyst David Whiston told FOX Business on Tuesday.
"That number assumes all variable costs would go to zero, which wouldn't be the case. GM is still spending money on advertisements, salaries for people on the corporate side," Whiston said. "When you factor in some variable costs, a number above 80 million is probably more likely."
GM declined to comment on analysts' estimates of its daily losses.
Whiston was not surprised by the strike that started Sunday.
"I don't think it goes just a couple days because I think the union wants to make a point," he said. "I think they want to show GM they can stand up to them."
However, in a research report concluded on Sunday, Whiston pointed out that workers likely see their position as stronger than that of striking workers in 2007, the last time there was a nationwide strike.
"GM today is in much better financial health that old GM was in 2007, so we think workers expect GM to be able to offer more concessions than it has in this summer's talks," he wrote. "The UAW struck GM for 67 days during the 1970 contract talks, but we don't see this strike lasting that long."
Talks between GM and UAW were set to resume Tuesday after a pause overnight.
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UAW has organized major work stoppages at GM facilities 21 times since 1994, according to the Bureau of Labor Statistics. This is the first strike against GM in 12 years. UAW is demanding a bigger share in the company's profits, including annual pay raises, while GM says it has already given workers a "strong offer."