In recent developments, the crisis in the Red Sea has had tangible consequences for the automotive supply chain, leading Tesla and Volvo to announce temporary production suspensions in Europe due to a component shortage originating from plants in Asia. Brian Fairchild, our Senior Director of Sales and Sales Operations, highlighted the ongoing challenges in the automotive supply chain, emphasizing that disruptions are becoming more manageable post-COVID. However, he cautioned about potential future disruptions, particularly in the realm of labor, as the United Auto Workers expand their influence beyond traditional associations.

Fairchild underscored concerns about potential wage increases impacting suppliers and a shift in focus by the UAW towards other manufacturing sectors. Border issues, particularly between the U.S. and Mexico, are also identified as a potential challenge, impacting customs checks and slowing the flow of components. The evolving dynamics with China and nearshoring, as well as the influence of political environments and ethical sourcing considerations, add further layers of complexity to the automotive supply chain. The overarching geopolitical concerns and the financial implications of significant investments in electric vehicle (EV) initiatives were also acknowledged, especially with the potential softening of demand and infrastructure challenges.

In the face of these challenges, Fairchild commended the resilience and adaptability of the supply chain but emphasized the ongoing need for careful management to navigate potential disruptions without compromising efficiency or accumulating excess inventory.

For further insights into Brian’s comments, you can refer to the Supply Chain Management Review piece following the link below.

The United Auto Workers (UAW) has reached a tentative contract deal with General Motors, the last of the Big Three automakers, marking the potential end of a historic six-week strike that has had significant economic and worker gains. The contracts, also tentatively agreed upon with Ford and Stellantis, are the most substantial compensation increases the UAW has secured in decades, including a 25% wage raise over 4.5 years.

The strike’s resolution is important for the automotive industry, contributing 3% of the nation’s GDP. President Biden, who actively supported the negotiations, sees the agreements as a testament to the power of workers and an economic boost. While these deals protect workers during the transition to electric vehicles, the specifics of wage implications remain unclear. Ratification votes are pending, and if rejected, workers may return to striking. These agreements coincide with increased workplace activism in the US, with workers across various industries striking and achieving significant gains. UAW’s relatively new president, Shawn Fain, has ambitious plans to expand unionization in the auto industry.

For further insights on how the UAW strike is affecting suppliers and comments from Seraph’s founder and CEO Ambrose Conroy, you can refer to The Washington Post piece following the link below. 

The looming UAW strike threatens to significantly disrupt the customary ease and satisfaction Americans experience when purchasing cars.

Anticipate a scenario marked by reduced choices, diminished dealer incentives, and escalating prices should the strike materialize. Despite the Big Three automakers currently boasting ample inventory, an extended strike could perturb the supply chain, resulting in price hikes, even for pre-owned vehicles.

Moreover, foreign automakers may be compelled to follow suit by raising their prices and reducing incentives due to heightened market demand. Furthermore, the availability of car parts might suffer delays.

To navigate this challenging landscape, industry experts recommend swift action, a willingness to consider more flexible vehicle models, and readiness for enduring price and supply repercussions even after the strike’s resolution. In essence, consumers must choose between prompt action or practicing patience when confronted with potential disruptions in the auto industry.

For further insights on what a UAW strike could mean for your ability to find a car to buy and comments from Seraph’s founder and CEO Ambrose Conroy, you can refer to the Scripps News Tonight piece following the link below. 

At the stroke of midnight last Friday (9/15), the United Auto Workers union initiated the strike against the prominent Detroit automakers. This labor action saw employees cease their work at three manufacturing facilities situated in the United States.

The UAW contract with the three major automakers Ford, General Motors, and Stellantis was set to expire on September 14, and demanded significant changes, including a substantial wage increase and a shorter workweek. Counteroffers from the automakers have been criticized by the UAW.

These plants, strategically situated in Michigan, Ohio, and Missouri, play a pivotal role in the production of some of the most popular vehicles under the banners of all three automotive giants.

For further insights on what a UAW strike could mean for the automakers and the automotive industry along with comments from Seraph’s founder and CEO Ambrose Conroy, you can refer to the Scripps News Tonight interview following the link below. 

The United Auto Workers (UAW) contract with major automakers (Ford, General Motors, Stellantis) is set to expire on September 14, and the UAW has demanded significant changes, including a substantial wage increase and a shorter workweek. Counteroffers from the automakers have been criticized by the UAW.

There is a growing likelihood of a strike, and experts are considering its potential impact. The UAW has an $825 million strike fund, which could last around 90 days. However, if the strike is tactical and focuses on key factories (e.g., engine and transmission plants), it could extend even longer.

This situation comes as manufacturers are trying to rebuild dealer inventories and production. Supply chain issues are easing, but used car prices are returning to normal, and new car incentives are increasing.

Automakers are cautious about the strike risk but haven’t provided specific information about their inventory preparations. Parts shortages due to a strike could have a more immediate impact, potentially affecting new-vehicle sales.

If a strike occurs, incentives are expected to disappear quickly, and consumers looking for deals are advised to buy now. Limited choices and higher used car prices may follow if the strike persists beyond 30 days, causing potential disruptions in the automotive market.

For further insights on what a UAW strike could mean for your ability to find a car to buy and comments from Seraph’s founder and CEO Ambrose Conroy, you can refer to the Car and Drivers’ piece following the link below. 

China’s economic challenges are impacting global supply chains, causing concerns for businesses that rely on it for manufacturing. Factors such as labor shortages, production delays, increased demand, and ongoing lockdowns in China have disrupted supply chains since 2020. This has led to rising prices and longer lead times for many products.

China faces economic challenges, including higher wages for factory workers, a trade war with the U.S., and record-high youth unemployment. President Biden has referred to China as a “ticking time bomb.”

Businesses are advised to:

1. Understand the issues at play, including rising labor costs, labor shortages, and the trade war’s impact on sourcing from China.
2. Consider diversifying their manufacturing and sourcing from countries like India, Vietnam, and Mexico, though diversification can introduce complexities and potential quality concerns.
3. Focus on customer satisfaction and delivering products despite supply chain challenges. Some businesses are adjusting their cash flow strategies and working closely with customers to plan for supply chain disruptions.
4. If necessary, raise prices but offer higher-quality products to maintain customer loyalty.
5. Start planning for supply chain diversification and building relationships with alternative suppliers to mitigate risks.

The evolving situation in China requires businesses to adapt and find creative solutions to maintain their supply chains and customer satisfaction.

For further insights on China’s economic woes are impacting small businesses and recommendations from Seraph’s founder and CEO Ambrose Conroy, you can refer to the Inc. piece following the link below. 

For further insights on what happens in the event of a strike and comments from Seraph’s founder and CEO Ambrose Conroy, you can refer to the Washington Post piece following the link below. 

The United Auto Workers (UAW) union is currently in negotiations with the Big Three automakers (General Motors, Ford, and Stellantis) to improve the contracts for its members. The UAW’s newly elected president, Shawn Fain, has promised a more assertive approach in negotiations, with a focus on addressing the challenges arising from the transition to electric vehicles (EVs) and ensuring fair treatment for the workers in this changing industry.

The automakers are cautious in their responses during negotiations, seeking to avoid becoming the UAW’s primary target. Each company is striving to negotiate fair contracts while keeping in mind the financial implications of the EV transition.

Analysts predict that a strike by the UAW is likely, with Stellantis being a potential target. The UAW aims to safeguard the interests of its members during the EV transition and maintain its relevance in the evolving automotive industry.

For further insights on the UAW negotiations and comments from Seraph’s NA President Thomas Kowal, you can refer to the Automotive Dive piece following the link below.