Steel Markets

Ford, UAW Sign Labor Pact, FCA Negotiations Next

Written by Sandy Williams

United Auto Workers have ratified a new four-year contract with Ford with the approval by 56.3 percent of union members. The new contract includes a $9,000 signing bonus for full-time workers, performance bonuses, two 3 percent annual raises and two 4 percent lump sum payments. Health care costs remain unchanged.

“Every Ford employee and temporary employee will be at the top-rate for full-time status at the end of this four-year agreement,” said Acting UAW President and Director of the UAW Ford department Rory Gamble. “This is a life-changing contract for many and provides a template for all future Ford UAW members to a full-time, top-rate status. There will be no more permanent temporary situations and no more permanent tiers.”

On Ford’s side, the deal creates cost savings by closing the Romeo engine plant in Michigan using more temporary workers, and not increasing worker pensions.

Ford will also invest $6 billion in its U.S. plants, which includes increasing its footprint in electric vehicle production and retaining and creating more than 8,500 jobs.

FCA Negotiations

With the Ford agreement completed, the UAW turned to FCA negotiations yesterday. Last month, FCA announced it will pursue a merger with French automaker Peugeot (PSA Group). UAW negotiations are expected to seek commitments from FCA to ensure manufacturing remains in the U.S.

UAW wins at Ford and GM regarding temporary workers and pay for new hires may be costly for FCA if included in a new agreement.

“If you’ve got an advantage, you don’t want to give it up,” said Center for Automotive Research economist Kristin Dziczek. “It’s going to be very, very hard for them to take that on.”

“Fiat Chrysler is going last, so they’re playing catchup,“ she told The Wall Street Journal. “Each time the union sets a pattern, at the next company they’re going try to plus it up a little bit.”

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