How a protracted UAW strike could impact what people pay for new and used cars
LEILA FADEL, HOST:
Autoworkers and the Big Three Detroit automakers seem to be stuck at an impasse six days into a historic strike.
(SOUNDBITE OF ARCHIVED RECORDING)
UNIDENTIFIED AUTOWORKERS: (Chanting) No more tiers. No more tiers. No more tiers.
A MARTÍNEZ, HOST:
Ford, GM and Chrysler parent company Stellantis are negotiating with the United Auto Workers union, but there's no indication of an imminent deal. And now the UAW is threatening to expand its strike unless there's progress in the talks. So what does this mean if you're thinking about buying a new car?
FADEL: NPR's Camila Domonoske joins us now to talk about this. Hi. Good morning.
CAMILA DOMONOSKE, BYLINE: Good morning, Leila.
FADEL: So you talk to car shoppers all the time. Is this something people are worried about?
DOMONOSKE: It's on people's minds, for sure. Last week I was reporting on these strikes, but I also swung by the Detroit Auto Show and spoke with some people who were there, you know, thinking about buying a new car soon. That includes Chris Deneau. And he summed up his view on the strikes like this.
CHRIS DENEAU: Is it solvable? Absolutely. When will it be solved? I don't know. Am I too worried? Not really.
DOMONOSKE: On the other hand, there was also Sameer Joshi.
SAMEER JOSHI: It's going to drive down the supply of cars. So again, the dealerships are going to, you know, gouge people for more money. They'll sell them over MSRP.
JOSHI: Again, yeah.
DOMONOSKE: Over MSRP - he means sell them over sticker price, like they were doing not too long ago. Both those men, for the record, are pretty much right.
FADEL: OK. How are they both right? One's worried, one isn't.
DOMONOSKE: Yeah. Well, let's start with the case for not worrying. And to be clear, I'm talking about as a car shopper here, right? The strike has other economic impacts that we're not talking about right now.
But it's just a numbers game, right? Inventories - that's the vehicles that have been built and are ready to be sold - they're at their highest level in two years. And the number of plants that are on strike right now, it's just not huge. The unionized automakers decades ago - they were like 90% of the car market, right? Today, it's a different picture. They're less than 40%, and most of their plants are still running. The union strike strategy here has been to start small, pick a few plants to strike and then threaten to expand from there.
So right now, in terms of vehicles that are directly affected by the strike, you're looking at the Jeep Wrangler and Gladiator, GMC Canyon, the Chevy Colorado, and you've got the Ford Bronco and Ranger. And that's it, right? Now, it does depend on the vehicle whether that's going to have an impact on supply in the near term. Right now, there are a lot of Jeep Wranglers on lots. There are not a lot of Broncos out there. I feel like there's probably a cowboy joke in there, if I could make it work. But in general, this is not about to cause a sudden shortage of cars across America.
FADEL: OK, so that's the case for not worrying. What's the case for worrying?
DOMONOSKE: So it's about looking ahead, right? The union has threatened to put more plants on strike this Friday. More plants could shut down because of ripple effects. And if it lasts a really long time, we might see sales go away - not a lot of discounts this holiday season. You know, this could affect used cars, too, maybe. It will be slow if that happens. But car prices are already so high, some people are worried.
FADEL: NPR's Camila Domonoske, who will be back with her cowboy joke, maybe. Thanks so much.
DOMONOSKE: Thanks, Leila. Transcript provided by NPR, Copyright NPR.
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