Tentative Settlement Reached in Strike by Teamsters Car Haulers : Auto Sales Cut by 20-Day Stoppage
A tentative settlement was reached Wednesday in the 20-day strike by 20,000 unionized car haulers, just as the walkout was beginning to have a major effect on auto sales. The strike, which began July 26 in a dispute over economic issues, has virtually halted the delivery of new cars to all of the nation’s foreign and domestic car dealerships.
With new-car inventories on dealer lots dwindling as a result, the U.S. auto makers reported Wednesday that their sales were down 10% in early August from last year’s levels.
Auto industry officials, who blamed the decline on the strike, had warned in recent days that sales would continue to worsen throughout the month if the strike wasn’t settled soon.
But, before the striking truck drivers actually start delivering new cars to dealerships again, the agreement between bargainers for the Teamsters Union and the National Automobile Transporters Assn., a management group, must be approved by local union leaders in a meeting in Washington on Friday and later by rank-and-file truck drivers from around the country.
No Details Released
Last month, an earlier tentative agreement, which included some wage increases, was overwhelmingly rejected in a rank-and-file vote despite being recommended for approval by the union’s leadership.
No details were released Wednesday on the tentative settlement, but an industry spokesman said it contained a “substantial improvement” for the truck drivers over their previous contract.
Meanwhile, the strike has already put a crimp in car sales, and the situation could get much worse if supplies don’t reach dealers in the next few days.
“Dealer inventories are drying up because of the strike,” said Ted Sullivan, an auto analyst with Data Resources, a Lexington, Mass., economic forecasting firm. “Consumers are postponing purchasing new cars.”
Import dealers have been especially hard hit so far, because they had fewer cars on hand than domestic dealers when the strike began.
Sullivan added, however, that he expects that sales lost due to the strike will be recaptured by the auto makers once the walkout ends and dealer stocks are replenished.
Chrysler, the only domestic firm to report an increase in early August, said its sales were up 15% for the Aug. 1-10 period. GM said its sales slipped 10%, and Ford reported a sales decline of 12.4%.
Auto analysts said Chrysler’s strong sales showing was due in part to the relatively large supply of cars that its dealers had on hand going into the strike.
By contrast, Honda’s sales of U.S.-built cars fell 82.8% in early August, a decline that analysts attributed entirely to the car-haulers strike. Honda dealers had extremely low inventories when the strike began.
On a seasonally adjusted basis, car sales in early August equaled an annual rate of 7 million, down from 7.9 million in the same period last year.
The annual rate is a reflection of the number of cars that would be sold if the early August pace continued for a year.
Auto Sales
Aug. 1-10 Aug. 1-10 % 10-Day 1985 1984 change GM 92,298 102,561 -10.0 Ford 37,135 42,373 -12.4 Chrysler 24,649 21,423 +15.0 AMC * 2,700 5,330 -49.3 VW U.S. 1,149 1,350 -14.8 Honda U.S. 771 4,145 -82.8 Nissan U.S. 545 -- -- TOTAL 159,238 177,182 -10.1
* Estimate
