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UAW workers ratify historic 4-year contract with Ford

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TOM KRISHER
November 14, 2007
— United Auto Workers members have ratified a historic four-year contract with Ford Motor Co. that sets lower pay for some newly hired workers and puts the company’s huge retiree health care debt into a UAW-run trust.

The UAW, which represents about 54,000 workers at Ford, said Wednesday that 79 percent of those voting favored the pact.


Workers at General Motors Corp. and Chrysler LLC already have ratified similar deals, with the contract winning at Chrysler by only a small margin. Unlike the other two automakers, there was no strike at Ford.


The landmark deals have been praised by the companies and union for protecting jobs while at the same time cutting labor costs to make the struggling automakers more competitive with their Japanese rivals.


UAW President Ron Gettelfinger said the union negotiated a contract with Ford that protects wages, benefits and seniority rights and provides income and secure health care for retirees.


"We stood our ground in the face of some rather big asks by the company and came away with a creative agreement that addresses the concerns of our members and also gives the company the opportunity to move forward,“ he said in a statement. "Now it’s up to Ford to successfully bring to market the top-quality vehicles our members are building in UAW Ford factories.“


The UAW said production workers voted 81 percent in favor of the deal, while skilled trades workers were 71 percent in favor.


"This agreement is proof that by working together with our UAW partners, it is possible to find solutions that collectively benefit our employees, retirees and the company,“ Ford President and Chief Executive Alan Mulally said in a statement. "This contract will provide significant opportunities for the company’s long-term competitiveness, and that is good for all of us.“


In addition to the active workers, the deal covers more than 94,000 Ford retirees and 28,000 surviving spouses. It will run until Sept. 14, 2011.


The Ford deal was reached in the early morning hours of Nov. 3 after a nearly two-day bargaining session at the company’s Dearborn headquarters.


In exchange for the wage cuts and other concessions, Ford promised not to close any U.S. plants beyond some it already has identified. It also promised future products to six U.S. assembly plants and agreed to make hundreds of millions of dollars’ worth of improvements to factories.


Industry analysts say the pact should help the ailing automaker by lowering wages for thousands of new workers and moving its roughly $22 billion in hourly retiree health care obligations to a union-run trust.


Despite ratification, Ford stock dropped 3 cents per share to $7.97 in midday trading Wednesday.


Jim Stoufer, president of Local 249, which represents 4,300 workers at Ford’s Kansas City Assembly Plant in suburban Claycomo, Mo., said the contract should be a turning point for Ford.


The company lost $12.6 billion last year, but earned $88 million in the first nine months of this year. Still, Ford is losing money on its home turf of North America.


"I think the UAW and Ford got together and decided that we’re in this together and we’re going to turn this around,“ said Stoufer, whose plant makes the F-150 pickup truck and the Escape and Mercury Mariner small sport utility vehicles.


Workers, he said, had expected wage and benefit cuts, but realized they did pretty well to preserve wages and get job security pledges.


"I think this gives Ford what it needs to turn around, and at the same time, it protects the membership,“ Stoufer said. "I don’t think you can ask for anything more.“



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