Mercedes SL 55 AMG

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Talks broke off Monday when the strike began, but resumed in the afternoon and continued into the evening when weary bargainers broke for a rest. Analysts were encouraged that the talks have continued throughout the strike.

The union said it went on strike largely because GM failed to make promises for future products and investment in U.S. plants. GM said it was disappointed and would work with the UAW to address its competitive challenges.

``I'm hoping we get a fair contract. I understand that General Motors has their back against a wall. But I don't want to give them everything,'' said autoworker Ernie Bruton, who was picketing Tuesday outside a GM engine plant in the Detroit suburb of Romulus.

Wall Street was taking a wait-and-see approach. GM shares slipped 32 cents, or less than one per cent, to close at $34.42 Tuesday.

In 1970, a UAW strike against GM rippled through the economy. Production declined, unemployment rose and retail auto sales dried up, according to an analysis by Merrill Lynch. A 54-day strike against two GM plants in 1998 wreaked similar havoc and cost GM $2.2 billion.