Stellantis
looks set to emerge from the six-week United Auto Workers strike with less damage than Ford and General Motors.
Chrysler parent
Stellantis
(ticker: STLA) beat revenue expectations in the third quarter but flagged a €3 billion ($3.2 billion) hit to sales from the six-week UAW strike.
The impact of the strike on profits at
Stellantis
is expected to be less than €750 million ($797 million), Chief Financial Officer Natalie Knight said on a media call, Dow Jones Newswires reported.
In comparison,
Ford
(F) reported a $1.3 billion hit to profit, and
GM
(
GM
) a $800 million impact. “For us, we are a big global company, so [North America] is part of the scheme but it’s very different than what it is for our competitors, Knight said.
The stock rose 2.8% in premarket trading.
Stellantis,
which has now reached tentative agreements with both the United Auto Workers and Canada’s Unifor, said work stoppages have negatively impacted revenue by €3 billion ($3.2 billion), compared to planned production, through October.
Revenue rose 7% to €45.1 billion, beating analysts’ estimates of €43.2 billion, according to a FactSet survey. The jump reflected greater volumes and consistent pricing power, Stellantis said.
Despite the tentative deal to end the UAW strike, the fourth quarter will still be impacted given that the industrial action has lasted for the whole of October. However, Stellantis was still able to beat revenue estimates in the third quarter despite two weeks of strikes.
Unifor’s strike action at Stellantis plants lasted just a matter of hours early Monday as both parties quickly returned to the negotiating table and reached a deal.
A combination of the strikes coming to an end, a revenue beat, and a smaller impact on profit than its rivals looks set to boost the stock.
Write to Callum Keown at [email protected]
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