Navistar International Corporation is the latest truck manufacturer to announce it was affected by striking members of the United Auto Workers (UAW) union.
Navistar announced yesterday the six-week strike at General Motors Corporation (GM) impacted the company’s ability to deliver approximately 5,000 vehicles to customers during the company’s fiscal fourth quarter of 2019. Navistar says because of lost product, the company’s 2019 revenue and adjusted EBITDA is expected to be impacted by approximately $140 million and $15 million, respectively.
“We are pleased that we have resumed production at our Springfield, Ohio, truck assembly plant last week,” says Walter Borst, Navistar executive vice president and chief financial officer. “However, the shutdown of our Springfield plant affected our workforce and the delivery of certain units to customers. As a result, our 2019 full year revenue and adjusted EBITDA is now expected to be at the low end of our guidance range.”
The UAW’s six-week strike at GM impacted the delivery of certain components to Navistar’s Springfield assembly plant because of production shutdowns at GM facilities and affiliated suppliers. As a result, Navistar halted production at its Springfield plant Sept. 23, suspending production of Navistar’s own commercial trucks and GM-branded vehicles. On Nov. 4, Navistar resumed production at its Springfield plant.
Navistar’s decision to halt production at the Springfield plant affected the cutaway model of GM’s G Vans, Class 4-5 trucks and other commercial vehicles, the company says.
In late 2018, Navistar and GM signed a long-term agreement to develop and assemble medium-duty, conventional cab Class 4-5 commercial vehicles. The two companies also have an agreement under which Navistar manufactures the cutaway model of GM’s G Van.
In mid-October, approximately 3,500 Mack Trucks workers in Allentown and Middletown, Pa.; Hagerstown and Baltimore, Md.; and Jacksonville, Fla., went on strike seeking fair pay, benefits, job security and resolution to other matters, according to a statement by the UAW. Less than two weeks later, Mack Trucks announced on Thursday the company and the UAW union reached a tentative agreement on the terms of a new four-year deal.
