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Auto suppliers feeling the strain as the UAW's Big 3 strike continues

Posted at 6:39 PM, Sep 25, 2023

STERLING HEIGHTS, Mich. (WXYZ) — More and more supplier layoffs are occurring as a result of the United Auto Workers' targeted strike, which remains underway.

On Monday, Wixom’s Eagle Industries, which specializes in foam products announced it will layoff more than 170 workers. Auto suppliers say more and more, they are feeling the strain of a UAW strike, one that does not have a clear end in sight.

President of Sterling Heights supplier Citic Dicastal Dale Hadel says he’s glad his company hasn’t laid off anyone. Yet, the entire industry is being impacted in some way already.

“It’s death by a thousand razor blade cuts now,” Hadel said.

What’s ahead are tough choices for many companies. With roughly three dozen sites of the strike spread across Ford Motor Co., General Motors and Stellantis, a variety of suppliers have already made layoffs in the hundreds across the country.

“I’ve had calls from all over the country from different people. People outside Detroit are asking me every day what impact this is going to have and for how long,” Hadel said.

David Zoia, an analyst for WardsAuto is also sharing his perspective. He sees the mounting pressure only growing as the strike grows larger.

“We’re seeing impact in other places. U.S. Steel had to shut down in Illinois. Dana Corporation had to lay off 875 people,” Zoia said.

He added, “The problem for suppliers is it’ll start to impact their cash flow, particularly if you get down the tiers, the smaller guys. You could have some that don’t survive.”

For Hadel, there’s also a lot of thought as far as how customers are affected.

“A bumper, headlight, fender, they’re not able to get them right now. It starts to affect the customer first, then the jobs associated with those distribution networks,” Hadel said.

Looking ahead, there’s hope among some that Ford could be the first to soon reach a tentative deal, with other carmakers to follow. That’s based on the fact the union has indicated talks with Ford are showing the most progress so far.