General Motors had spent $21 billion over stock buybacks during the previous 12 years. It should have given away a lot more money to the workers of the assembly line instead.
That is the logic that the United Auto Workers have and are planning an intense strike against General Motors, Jeep parent Stellantis, and Ford. So far, about 13,000 members of the UAW have walked out of their jobs. The union has also threatened several other walkouts every week to pump up the trouble of all the three Detroit automakers.
An unavoidable PR battle is on the verge of breaking out as each side pushes in. At the Detroit Free Press on 20th September, the President of General Motors, Mark Reuss, mentioned that General Motors had already made a “record offer” to the workers that are a part of the strike while arguing that General Motors has reinvested a substantial portion of its profits in the newer facilities within the last ten years.
On the forthcoming day, the Vice President of the UAW, Mike Booth, denied those claims, adding that GM has been
“lavishing Wall Street with the results of our labor,”
which includes stock buybacks.
While Bloomberg added that
“it’s true the Detroit Three have enjoyed a nice run of profitability since emerging from the chaos of the Great Recession, when GM and Stellantis forerunner Chrysler declared bankruptcy and Ford nearly did. During the last five years, the Detroit Three combined have earned $99 billion in net income, according to data from S&P Capital IQ.”
But any profit that a company makes stands useless as long as it is not compared to the ones of its competitors. As compared to the other big auto-making competitors they have, they do not appear as rich as the others.