Often times when there is a strike or disruption in a company’s normal course of operations, the financial press will outlay some details as a general public you may not know. This helps you enhance your knowledge of the industry and what to focus on if you decide you want to be an investor. An example this year is the UAW or United Auto Workers contract was up with the 3 largest American car manufacturers – GM, Ford and Stellantis or Chrysler. Vehicles still play an important part of the average working family and that makes it newsworthy. Ford and Stellantis have settled and GM is the last one to settle. In the meantime, the union increased its strikes at GM facilities.

In an article by Joseph White of Reuters, the UAW went on strike at GM’s Arlington, Texas factory which builds highly profitable Cadillac Escalades, Chevrolet Suburbans and other large SUVs.

The move to shut down one of GM’s most profitable plants will push the weekly cost of the union’s strike well above the $200 million a week rate GM executives outlined for investors.

GM’s 3rd quarter net income fell 7.3% to $3.06 billion while revenue rose 5.4% to $44.1 billion. The adjusted earnings per share was $2.28 which beat Wall Street expectations and up from $2.25 a year earlier. The buyback of shares helped the earnings per share number.

GM is reworking its EV strategy pulling back a strategy to challenge Tesla’s lead. The Chevrolet Bolt EV will be launched with a lower cost lithium-iron battery. The goal to build 400,000 EVs from 2022 to mid 2024 is cancelled because of lack of buyers. While the company agrees EVs are the solution in the future, it is lobbying Washinton to change the ambitious emissions and fuel economy aimed at pushing EVs to 2/3’s of the US vehicle market by 2032.

Linking to dividend paying stocks, all investors depend on the financial press, although most of the time the financial news in not on the front page. When the news is on the front page, everyone can see and talk about the event, but most do not know the details of the issue. Most of the time in the business side you will be given some details and then you can make some decisions. For example in the above article, the highly profitable Arlington Texas plant. The implication is if that strike goes on for a longer period of time and those SUVs are not sold, GM makes less money. In all likelihood, GM makes money it just makes less money. Ass investor you can wait till the share price falls, and when the strike is over, buy the shares to allow GM to meet the demand for its vehicles and profitability is restored. Patience is needed.

There are more questions than answers, till the next time – to raising questions.