UAW-Ford Collective Bargaining Agreement Part of the Foundation for an Even Stronger Business in Years Ahead
November 30 2015 - 8:00AM
Business Wire
- New agreement secures $9 billion of
investments in Ford’s U.S. plants and creates or secures 8,500 U.S.
hourly jobs at Ford’s U.S. manufacturing facilities; provides work
force with base pay increases, bonuses and other benefits
- In the U.S., labor cost structure
standardized with domestic competitors; Ford’s U.S. labor cost
increase limited to less than 1.5 percent a year, including
ratification and lump sum bonuses
- Agreement maintains flexibility to
optimize alternative work schedules and achieves additional daily
and weekend mandatory overtime. Beyond U.S. sourcing commitments,
Ford maintains flexibility to leverage its global manufacturing
footprint to improve cost competitiveness for products the company
may sell in North America
- Agreement is consistent with the
company’s full-year guidance for 2015
The new collective bargaining agreement ratified on Friday, Nov.
20 by United Auto Workers (UAW) represented employees in the United
States provides a good foundation for Ford (NYSE:F) to create an
even stronger business in the years ahead.
“This agreement enables us to further strengthen our business
and continue investing in manufacturing in the U.S.,” said Mark
Fields, Ford president and chief executive officer. “At the same
time, the agreement aligns our labor cost structure more closely
with our competition and improves our manufacturing productivity
and staffing flexibility.”
The terms of the new agreement provide Ford with several
opportunities to improve its overall productivity, including:
- An end to a cap on entry-level
employees;
- Improved ability to use temporary
workers;
- Use of alternative work schedules,
along with additional daily and weekly mandatory overtime;
- Flexibility to leverage Ford’s global
manufacturing footprint to improve cost competitiveness for
products the company may sell in North America; and
- Maintaining the current Supplemental
Unemployment Benefit agreement, which allows Ford to remain
competitive in a downturn.
The new agreement also puts Ford on common footing with its
domestic competitors regarding overall labor cost structure. During
the four-year contract period, the agreement effectively closes the
labor cost gap to General Motors and substantially narrows the gap
to Fiat Chrysler Automobiles.
Overall, including the ratification and lump sum bonuses, Ford’s
U.S. labor costs will increase by less than 1.5 percent a year,
which is less than the company’s present forecast of inflation over
the contract period.
Ford will incur a $600 million expense this year tied to the new
agreement, primarily associated with the ratification bonus. This
is consistent with the company’s full-year guidance for 2015.
The company also has committed to investing $9 billion in its
U.S. plants and expects to create or secure 8,500 hourly U.S. jobs
in communities across Michigan, Illinois, Kentucky, Missouri, New
York and Ohio. The jobs will support production of the all-new Ford
Super Duty, F-150 Raptor, Lincoln Continental and several new
powertrain technologies.
The agreement covers approximately 53,000 UAW-represented
employees in the U.S. It builds on the 2011 Ford-UAW labor
agreement, in which Ford pledged to create 12,000 new U.S. jobs.
The company exceeded that commitment by adding more than 15,000
hourly jobs between 2011 and 2015 and investing $10.2 billion in
the company’s U.S. plants.
About Ford Motor Company
Ford Motor Company, a global automotive industry leader based in
Dearborn, Michigan, manufactures or distributes automobiles across
six continents. With about 197,000 employees and 67 plants
worldwide, the company’s automotive brands include Ford and
Lincoln. The company provides financial services through Ford Motor
Credit Company. For more information regarding Ford and its
products worldwide, please visit www.corporate.ford.com.
For news releases, related materials and
high-resolution photos and video, visit www.media.ford.com.
Follow at www.facebook.com/ford,
www.twitter.com/ford or www.youtube.com/fordvideo1
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version on businesswire.com: http://www.businesswire.com/news/home/20151130005293/en/
Ford Motor CompanyKelli Felker, 313-322-1790Cell:
313-205-2722kfelker1@ford.com
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