GM adds labor costs with new UAW deal, but it's a much healthier company today

Reuters
GM adds labor costs with new UAW deal, but it's a much healthier company today

A decade ago, high labor costs helped drag a bloated and debt-ridden General Motors into a government-funded bankruptcy. Now, a contract deal reached this week with the United Auto Workers union will raise the company's costs once again, at a time when the auto industry is facing the uncertainty of tariffs and trade wars, slowing global sales and rising capital expenses to develop autonomous and electric vehicles. Analysts say the four-year deal, if approved next week by 49,000 striking workers, will hit GM's bottom line, but not badly enough to send it back into financial trouble like 2009, when it ran out of cash and was cleansed of $54 billion in debt during a 40-day trip through bankruptcy protection.