UAW, Ford reach tentative deal; Biden praises hard-fought contract.
The UAW and Ford Motor Reach Tentative Agreement to End Strike
The United Auto Workers (UAW) union and Ford Motor have reached a tentative agreement that could end a nearly six-week strike at the Big Three automaker.
During a video published online on Oct. 25, UAW President Shawn Fain announced that a tentative deal had been made. The deal features a 25 percent general wage hike over the terms of the contract. In addition to the across-the-board pay increase, UAW secured a 150 percent raise for current Ford temps through the 2023 agreement, a 33 percent top wage increase, and a three-year wage progression.
Additionally, Ford agreed to reinstate cost-of-living adjustments (COLA), the right to strike over plant closures, and kill “divisive” wage tiers.
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“I want to be clear: we told Ford to pony up, and they did,” Mr. Fain said. ”We won things nobody thought was possible.”
According to the union, the value of gains in the tentative agreement is worth four times more than that in the 2019 agreement. Plus, the UAW purported that the 2023 arrangement offers more in raises than the past 22 years combined.
The new deal, the UAW chief says, paves a path to improve conditions for workers at Ford, the Detroit Three, and the entire auto industry.
“Together, we are turning the tide for the working class in this country,” he added. “We’ll move forward together. As a united UAW, back in the fight to save the American dream.”
Industry observers note that the UAW’s tentative agreement summary omits future wages and unionization at any of the Big Three’s electric vehicle battery factories they are constructing with Asian companies.
The tentative deal now requires approval by local UAW leaders and then ratified by a majority of Ford’s 57,000 union-represented employees. Mr. Fain confirmed the organization will host a Facebook Live briefing and informational meetings to discuss the agreement.
Ford will begin restarting production at the Chicago Assembly Plant, the Kentucky Truck Plant, and the Michigan Assembly Plant, where nearly 17,000 workers walked off the job and hit the picket lines. The roughly 3,000 temporarily laid-off employees are also expected to return to work.
In the meantime, UAW Vice President Chuck Browning, who led contract negotiations with Ford, noted during the online announcement that autoworkers currently on strike at Ford will return to work during the approval process.
Ford stock rose close to 2 percent in after-hours trading to $11.54. It had finished the trading session up 1.32 percent.
But while operations normalize at Ford, the union’s strike at General Motors and Stellantis will continue.
“We’re going back to work at Ford to keep the pressure on Stellantis and GM,” said Mr. Browning. “The last thing they want is Ford to get back to full capacity while they mess around and lag.”
Biden: ‘Hard Fought’ Negotiation
President Joe Biden applauded the news, saying in a statement that the agreement is the result of a “hard fought, good faith negotiation” between both sides.
“This tentative agreement provides a record raise to auto workers who have sacrificed so much to ensure our iconic Big Three companies can still lead the world in quality and innovation,” President Biden said. ”This tentative agreement is a testament to the power of employers and employees coming together to work out their differences at the bargaining table in a manner that helps businesses succeed while helping workers secure pay and benefits they can raise a family on and retire with dignity and respect.”
Last month, President Biden visited striking autoworkers in Michigan to show his support for the union.
Billions Lost
It is estimated that the UAW strike against the Big Three has so far resulted in more than $9 billion in economic losses for the automobile industry, according to estimates from the Anderson Economic Group (AEG).
In the breakdown, the strike has cost workers $488 million in lost wages, dealers and customers are collectively out $1.86 billion, and suppliers have endured a $2.78 billion hit.
“The cost of this strike is now double that of the 2019 UAW strike against General Motors, with significant layoffs among supplier firms. Lost wages of striking workers and those laid off because of the strike are nearing a half billion dollars,” said Patrick Anderson, the head of AEG, in an analysis note.
The loss projections do not include plant closures or layoffs that took effect on or after Oct. 20. They also do not consist of unemployment benefits, income taxes on wages, or reputational damage to the union or employers.
The implications for the broader economy are unclear, with economists noting that the UAW work stoppage has impacted a small percentage of the labor force and has been contained to the auto sector.
What are the key improvements in wages, benefits, and job security included in the agreement between the UAW and Ford?
Orkers and includes significant improvements in wages, benefits, and job security,” President Biden said. “It is a testament to the power of collective bargaining and the dedication of the UAW members who stood up for their rights.”
President Biden also acknowledged the importance of the auto industry to the American economy. ”The American auto industry is the backbone of our manufacturing sector, and the men and women who build our cars and trucks deserve fair wages, safe working conditions, and a voice on the job,” he stated.
The President expressed his hope that the agreement reached between the UAW and Ford would inspire similar agreements with other automakers. “I urge all parties involved to swiftly ratify this agreement and for other companies in the industry to follow Ford’s lead in rewarding their workers with fair wages and benefits,” he concluded.
Impact on the Auto Industry
The UAW’s nearly six-week strike at Ford has had a significant impact on the auto industry. Production at the affected plants was halted, causing delays in vehicle deliveries and disrupting the supply chain. The strike also put pressure on General Motors and Stellantis, as the UAW continued its strike at these companies.
With the tentative agreement in place, Ford will resume production at its plants, allowing for the production of vehicles to ramp up again. This is crucial for the company, as well as for dealers and customers waiting for their orders to be fulfilled.
The agreement also sets a precedent for future negotiations between the UAW and other automakers. It highlights the importance of fair wages, benefits, and job security for autoworkers and demonstrates the effectiveness of collective bargaining in achieving these goals.
Conclusion
The tentative agreement reached between the UAW and Ford Motor is a significant milestone in the resolution of the nearly six-week strike. It includes a 25 percent general wage hike, a 150 percent raise for current Ford temps, a 33 percent top wage increase, and a three-year wage progression. Ford has also agreed to reinstate cost-of-living adjustments and the right to strike over plant closures.
The agreement now awaits approval by local UAW leaders and ratification by Ford’s union-represented employees. President Biden has praised the agreement as a result of “hard fought, good faith negotiation” and hopes that it will inspire fair agreements with other automakers.
With production set to resume at Ford, the auto industry can recover from the disruptions caused by the strike. The agreement also sets a precedent for fair wages and benefits in the industry and demonstrates the importance of collective bargaining in protecting the rights of autoworkers.
Overall, the agreement represents a positive step forward for both the UAW and Ford Motor, as well as for the future of the auto industry as a whole.
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