As inventory begins to run out at GM dealerships, the automaker could lose its brand-loyal customers to competitors.
, the economic impact could be significant—affecting key indicators including jobs, industrial production, durable goods and shipments as well.
Michael Cosgrove, principal at The Econoclast, echoed the thought."If the strike did last two or three months, one could expect 4th quarter real GDP growth to slow from 2 percent to perhaps 1.8 percent," Cosgrove told Newsweek."It would be surprising if this strike lasted more than 30 days," he added.
In addition, large strikes have an impact on other industries' or companies' jobs downstream, and those affected could file for unemployment. Jobs at companies dependent on sales to GM will contribute to the job data, Englund said.Industrial production data will likely see a dip as well, and analysts have trimmed their forecasts for the September release.
Among other data releases, analysts expect a depressed reading of the shipments and inventory data in the durable and factory reports if the strike is not resolved in the next few days. "A week or two isn't a big deal, but a strike lasting longer than a month is where GM starts to lose larger amounts of sales. That's probably also around the time the difficulties increase more for those on strike," Yung-Yu Ma, chief investment strategist at BMO Wealth Management, said."If the strike drags on, you can expect competitors to roll out promotions and advertising campaigns to take market share.
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