Published: Tuesday, 13 Oct 2009 | 1:44 PM ET

Text Size

The United Auto Workers and Ford Motor have reached a tentative agreement that includes a no-strike provision and wage freeze for new hires that would bring the contract in line with U.S. rivals.

The UAW will present the tentative pact to its National Ford Council delegates Tuesday afternoon in Detroit and then put it to a member vote should the group agree, it said.

Gene J. Puskar / AP

The union and Ford

F loading...

Quote  |  Chart  |  News  |  Profile

[F  Loading...      ()   ] declined to release details of the changes pending the UAW membership vote. Ford said the changes would "help Ford improve its current and long-term competitiveness in the United States."

In addition to the wage wage freeze for new hires and no-strike provision when the contract expires, the tentative pact includes a one-time bonus and some production commitments, according to a source with direct knowledge of the details who spoke on condition of anonymity because the contract has not been approved.

Ford, the only large U.S. automaker not to undergo a government-supported bankruptcy in 2009, has moved to bring its contract in line with those of General Motors and Chrysler, which received deeper union concessions earlier in 2009.

Some UAW local officials predicted that the proposed concessions would face tough scrutiny from rank-and-file workers who have accepted a series of givebacks since 2005.

The call for concessions comes as optimism is building that the U.S. recession has ended and automotive analysts and executives see industry sales as beginning to turn a corner toward a gradual recovery after a four-year decline.

Ford opened talks with the UAW on the latest concession requests Aug. 25 for changes to a historic four-year contract from 2007 that covers about 41,000 workers.

The UAW reached four-year contracts with all three Detroit automakers in 2007, but agreed to make unprecedented mid- contract concessions to the companies amid the severe recession and deep downturn in auto industry sales.

UAW workers at Ford agreed to mid-contract concessions in February, ahead of GM and Chrysler, that saved Ford about $500 million per year and allowed it flexibility in how it funds a union retiree health-care trust.

Executives from Ford have said its agreement with the UAW would put Ford at a disadvantage over the long term compared with GM and Chrysler. Traditionally, the UAW has applied a single pattern to all of its agreements with Detroit's automakers.

The agreements with GM and Chrysler, which both went through government-supported bankruptcies, include a no-strike clause for the next contract, fewer skilled-trades classifications and wage freezes for new hires.

Ford, which has said it expects to return to at least break-even in 2011, held a series of meetings at U.S. plants led by manufacturing chief Joe Hinrichs to present its case for further union concessions.

With Ford already in better shape than its U.S. rivals, some local leaders expressed opposition to more concessions during a meeting with the top UAW leaders in August.

Ford also wants concessions from the Canadian Auto Workers union. The CAW said Thursday it would resume full-scale discussions with Ford on Oct. 26.

The CAW wants guarantees on future plant investments in Canada by Ford, while the automaker wants to address a labor cost gap. Labor costs run about $16 per hour higher for Ford in Canada than in the United States.

Ford shares were up on the New York Stock Exchange on Tuesday afternoon.

• Are You Driving One of America's Most-Ticketed Cars?

Print

Email

Text Size