(CBS) Jonathan Grant’s Central Avenue dealership in Yonkers, New York sells vehicles from Chrysler, Jeep and Dodge. Right now, the lot is full of new cars but Grant worries that could change if the United Auto Workers strike continues.
“I’m afraid if the strike lasts long, it could impact our availability,” Grant says.
The plant that builds the popular Jeep Wrangler is currently shut down. Ford and GM dealerships could face the same problem if assembly lines sit idle for a prolonged period.
“If it goes beyond 60 or 90 days or grows to other plants, I think the impact could be much more severe,” Grant says.
During the pandemic consumers saw a lack of supply lead to skyrocketing prices. It’s feared that could happen again if dealerships aren’t able to get new cars.
“We could see prices start to rise. It won’t happen immediately, there’s still inventory on these lots. But if this were to persist and it spreads out to more and more workers and more and more plants are involved, we could see a real supply issue, which would push up the price of these cars,” says CBS News Business Analyst Jill Schlesinger.
The more immediate impact could be on replacement parts for vehicles. Those supplies could dry up in the coming weeks if the strike continues.
“We could have the brakes in stock, but if we don’t have a spring that’s needed in the brake pads we can’t finish the job, and we can’t get your car on a road,” says Tom Maoli, Owner of Celebrity Ford in Toms River, New Jersey.
Maoli says if he can’t fix cars and doesn’t have vehicles to sell, he may need to lay off employees.
“You can only keep the payroll going for so long when the money is not coming in,” Maoli says.
Automakers are also laying off workers which impacts the local businesses where they spend money.
“Well if you have less money to spend, you’re going to really hold on to what you have, that reduction in spending could curb economic growth in those local communities,” Schlesinger says.
Schlesinger says the strike is not expected to have a major impact on the entire US economy, unless it continues into next year.