Ford to spare auto plants
Ford Motor Co. agreed to keep three U.S. plants open and delay closing an additional two as part of a tentative four-year contract with the United Auto Workers unanimously endorsed by union officials Monday.
The endorsement sets the stage for a ratification vote by about 58,000 UAW-represented Ford workers expected to conclude by next Monday without the kind of deep-seated division that marked debate over the union’s earlier deal with Chrysler.
Under the tentative deal, Ford pulled back from a plan to close six U.S. facilities that it had not yet identified, sparing three assembly plants from closure.
In exchange, the Dearborn, Mich.-based company won the right to hire up to one-fifth of its U.S. workforce under a lower-tier pay structure starting at just over $14 per hour -- roughly half its current average factory wage.
Ford pledged to build new models at two assembly plants in Wayne, Mich., and a third plant in Louisville, Ky., sparing those plants from closure and preserving more than 7,000 UAW-represented jobs.
In addition, Ford will delay the planned closings of an assembly plant in St. Paul, Minn., by one year to 2009, and a casting plant in Cleveland, by a year until 2010.
UAW President Ron Gettelfinger said he did not expect Ford to follow Chrysler by announcing further job cuts after its workers had ratified the new contract.
Chrysler, which was recently taken private, shocked and angered many in the union by announcing cuts of as many as 10,000 additional factory jobs and scrapping four slow-selling models just days after clinching its own cost-cutting contract with the UAW after a close-fought ratification vote.
Gettelfinger said he had been “absolutely not” aware of Chrysler’s plans in advance.
“We do not anticipate any additional cuts,” Gettelfinger said of Ford after a union meeting on the terms of the proposed deal. “We are led to believe by Ford that nothing is in the offing for layoffs.”
UAW officials, who had been split on the Chrysler deal, quickly closed ranks to endorse the deal with Ford.
“We have job security for the next four years, and that’s more than anyone can ask for in this environment,” said UAW Local 600 President Reggie Osborne, whose unit represents workers at a range of Ford facilities around Dearborn, Mich.
As expected, the proposed contract would establish a trust fund to take over Ford’s estimated $22-billion obligation for retiree healthcare.
Under the new contract, Ford agreed to pay $13.2 billion to establish that trust, known as a Voluntary Employee Beneficiary Association. In addition, Ford will shoulder the $2.2-billion estimated cost of providing retiree healthcare until the trust takes effect in 2010.
