General Motors and its autoworkers appear to have struck a deal, after the country's largest labor strike in over a decade. But the agreement does little to address long-term changes to the industry, in terms of electrification and autonomy, or the possibility ot gas price hikes and economic recession.
Go deeper ... Buckle up: GM, Michigan and 2020
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The deal between one of Detroit's biggest automakers and striking workers is a calculated bet on a vision for the auto industry that's far from certain.
The big picture: GM can afford the rich contract terms negotiated with the United Auto Workers — as long as nothing goes wrong. Higher gas prices, an economic downturn or a new president with different priorities could throw off the entire equation and put GM and other domestic automakers in a financial bind.
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GM announced Tuesday that it had earned $2.3 billion in the third quarter, down 8.7%, adding that the 40-day UAW labor strike will reduce its 2019 earnings by about $2 per share — or nearly $3 billion.
Driving the news: About one-third of the strike impact was felt in the third quarter, which ended September 30. Workers returned to factories last Friday after ratifying a new four-year contract. GM said the financial results, driven by truck and SUV profits, demonstrate its ongoing resilience and said the labor agreement allows it to maintain its operating flexibility in the future.
Go deeper: GM, Michigan and 2020
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United Auto Workers union leaders said Wednesday evening that they had reached a proposed tentative agreement with Ford — just five days after autoworkers ended the longest nationwide strike against General Motors in half a century.
Why it matters: Negotiations had been ongoing at Ford even during the GM strike, so when that work stoppage ended, the deal at Ford came swiftly without any labor disruption. UAW leaders indicated the contract terms are similar to those reached at GM.