The General Motors strike is getting more expensive. It has likely cost the automaker more than $1 billion already.

GM UAW strike Michigan protestSteve Donagan with UAW Local 22 of Royal Oak, Michigan, carries his three-year-old daughter Regina on his shoulders as he walks the picket line with striking United Auto Workers (UAW) union members at the General Motors Detroit-Hamtramck Assembly Plant on September 25, 2019 in Detroit, Michigan. The UAW called a strike against GM at midnight on September 15th, the unions first national strike since 2007. This is the unions longest national strike since 1970.Bill Pugliano/Getty Images

  • General Motors workers have been striking since September 15 as their union negotiates a new contract.
  • That work stoppage is costing GM as the third quarter ends, and is only getting more expensive by the day.
  • JPMorgan estimates the automaker has already taken a $1 billion hit.
  • Visit Business Insider's homepage for more stories.

As the stalemate between General Motors and its employees represented by the United Auto Workers union drags through its third straight week, it's eating into even more of the automakers' balance sheet.

According to estimates from Ryan Brinkman, an analyst at JPMorgan, the strike had already cost GM more than $1 billion as of Monday morning, and is only getting more expensive.

"GM continues to lose on a daily basis as the strike wears on," he said in a note to clients. "We estimate the to-date and 3Q impact at ~$1,137 mn (~$480 mn Week 1 cost + ~$575 mn Week 2 cost + ~$82 mn cost for the first day, on September 30, of the strike's third week)."

Read more: The massive GM strike is energizing a new push among auto workers in the South that could shake up the industry

Here's the breakdown on that math, as it relates to stalled vehicle output from factories:

"We estimate General Motors produced roughly ~2.0 million vehicles in its US factories last year (roughly 38,500 per week), and ~3.0 mn when additionally considering its factories in Canada and Mexico (roughly 57,500 per week in total)," Brinkman said.

"The cost of the strike in Week 2, with virtually all of its North American assembly off-line, we estimate at ~$575 mn (57,500 lost units of North American production * a generic historical average variable profit per vehicle of ~$10,000), equating to a daily cost of ~$82 mn (~$575 mn divided by 7 days). During Week 1 of the strike, we assume the cost was a lesser ~$480 mn, given only partial shutdown of Canadian and Mexican assembly (assumes 48,000 lost units of production - the same 38,500 in the US as in Week 2, plus 50% of the 19,000 units of typical weekly Canada / Mexico assembly)."

The end of the third quarter in the midst of the strike is a silver lining, Brinkman says.

"GM likely has some ability to recover a portion of these lost profits by shifting production from 3Q into 4Q," Brinkman said. "Although the automaker will also likely be limited in its ability to add production for vehicles already in high demand or in launch mode (such as its high profit full-size "heavy duty" pickup trucks)."

The Union's director said Tuesday that the UAW and GM were still in talks. A GM proposal "did not satisfy your contract demands or needs," the statement reads.

In response, GM said "we continue to negotiate and exchange proposals, and remain committed to reaching an agreement that builds a stronger future for our employees and our company."

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