Strikes at the plants of General Motors, Ford and Stellantis have not seen the signs of the end. However, consumers' purchasing behaviors have become different already. The adjustment is bringing changes to the markets of OEM, aftermarket (AM) and OES (original equipment supplier).
Taiwan-based powertrain manufacturer Tsang Yow Industrial said as strikes at the Big Three impact the OEM market, consumers are more likely to buy used cars. Therefore, AM and OES sales in the fourth quarter of this year will probably grow further, benefiting the supply chain.
Tsang Yow used its third-quarter revenues as an example. OEM customers accounted for 44% of the company's revenues, while AM and OES customers took up 47% and 9%, respectively. The proportion of revenues AM and OES customers contributed grew by 1% from 2022.
The company said it sees better gross profit rates in the AM and OES markets. It expected a better overall gross profit rate and profits in the third quarter as its updated pricing strategy has gradually yielded results and it disposed the loss-making plant in Wuxi, China.
For the fourth quarter this year, Tsang Yow said it hopes to increase part deliveries of automatic transmission and heavy-duty truck clutches to AM and OES customers before Christmas. The ramp-up can offset the impact of decreasing deliveries to OEM customers and will likely improve the company's profitability.
In September, Tsang Yow reached NT$110 million (US$3.42 million) in consolidated revenues, up 13.3% from the previous month. The company accumulated NT$1.09 billion in consolidated revenues for the first three quarters of 2023, decreasing by 22.4% year-over-year.
Strikes at the Big Three have expanded to over 20 states and more than 40 plants in the US. GM said on October 4 that the walkout caused at least a US$200 million loss for the first two weeks. Anderson Economic Group estimated that by the end of the third week of the strike, the US automotive industry had seen US$5.5 billion in loss, more than any walkout in this century caused.
Sodecia Automotive Detroit said on October 9 that 143 employees will be laid off temporarily. CIE Newcor also said it plans to follow suit.
