Detroit auto companies have long expected a quid pro quo from Wall Street when it came to their dealings with the United Automobile Workers union. Once the companies won labor contracts that improved their competitiveness, investors would bid up their share prices, or so they thought. Instead, shares of General Motors and the Ford Motor Company have been sliding since this summer when talks began on new four-year contracts. While the shares rose Friday, along with the market, the outlook for auto sales in 2008 is increasingly pessimistic as the broader economy struggles and the housing crisis deepens.
See "Labor Pacts in Detroit Didn?t Ease Stocks? Slide", Nick Bunkley and Micheline Maynard, The New York Times, December 2, 2007